To manage your IP assets, first value them

Mike Moberly, president and founder of Knowledge Protection Strategies (KPS) and a contributor to BVR’s newly launched IP Management & Valuation reporter, has this to say about how to approach the valuation of intangibles in today’s world:

“If it can’t be measured, it can’t be managed,” an axiom attributed to Peter Drucker and several others, is as fresh today as when it was initially offered back in the 1990s. Increasing percentages (65%+) of a company’s value, sources of revenue, and foundations for growth evolve directly from intangible assets—including intellectual properties, proprietary knowhow, brand, goodwill, and more.

In fact, there is no other time in history when measuring and managing the value of knowledge-based assets (intangibles) is more necessary to a company’s growth and profitability.
Only by assessing the value of a company’s intangibles can management teams be positioned to recognize, in a timely manner:

• erosion or undermining of asset value and competitive advantages through misappropriation, infringement, and counterfeiting;
• material changes in assets relative to Sarbanes-Oxley and FASB; and
• asset obsolescence.

Asset valuation must constitute much more than periodic snapshots-in-time, however. It behooves management teams today to have an ongoing asset valuation process because value and materiality can fluctuate relative to the asset’s vulnerability. When an adverse event occurs, an asset’s value and competitive advantages can be significantly impaired; hence, a company’s—or project’s—anticipated profitability and sustainability can be rapidly undermined or stifled altogether.

Current, accurate IP asset valuation allows management teams to be more responsive to:

• handling inevitable challenges, disputes, and routine external targeting;
• meeting their ever-expanding fiduciary responsibilities insofar as protecting, preserving, strengthening, and managing their intangibles; and
• allocating and directing resources commensurate with an asset’s value.

IP management, valuation and strategy the focus of a new reporter from BVR

Intangible assets are now the primary business drivers in the global economy—and measurement and valuation issues are central to corporate success. That’s why the IP Value Publishing division of BVR is launching a comprehensive, new monthly reporter, IP Management & Valuation (IPMV). IPMV focuses on valuation not only for appraisers, but for chief IP officers, lawyers and other stakeholders who must identify, value, protect, and grow IP assets.

The premiere issue includes articles by top experts on:

• Indirect profits from copyright infringement...
• Fundamental principles of patent value...
• The 14 “warning signs” when valuing your IP portfolio...
• Exclusive analysis of the most significant recent IP litigation, including the Oracle/SAP decision...
• A new professional certification in intangible asset valuation... and,
• How the America Invents Act impacts valuation, complete with implementation dates

IP Value Wire subscribers can get the current issue of the IPMV for free. For more information and to download the current issue, click here.

Don’t Miss Out on BVR’s Upcoming Webinar, Trade Secret Assets: Management and Valuation

This important BVR webinar for all intellectual property professionals, presented by R. Mark Halligan, an attorney for Nixon Peabody, will be held on Wednesday, January 18, 2012  from 10 am-11:15am PT / 1pm-2:15pm ET.

As intangible assets continue to grow as a portion of company value, revenue, and future wealth creation, so too does the reliance on trade secrets. In this 75-minute program, expert attorney R. Mark Halligan will bring much needed business and valuation clarity to a company's trade secrets and how the changing nature of our economy has increased their importance.

Mr. Halligan will cover what every IP counsel and business valuation analyst needs to know about trade secrets in the increasingly knowledge-based global economy. This webinar will address how "traditional" valuation techniques can be used to arrive at the stand-alone value of trade secrets and will draw attention to the necessity of improving methods and practices to effectively safeguard a company's most valuable asset: its trade secrets.

Earn 1.5 CPE credits and up to 1.5 CLE credits as well. Cost:  $179. Register for the Valuing Trade Secrets webinar online.

Does the age of a patent matter as it potentially represents prior art?

The IP Intelligence Group on LinkedIn has a discussion on the age of a patent and its effect on current patentability. The takeaway? It doesn’t make any difference how old a patent is or whether or not it has expired. Does the patent in question contain “enabling” detail that relates to current claims? If it does, as James Ryley states, “it is prior art that either anticipates, or renders obvious, your claims.”

8-point checklist for developing a patent strategy for a new invention
Prudent IP management requires coordinating IP strategies with overall business strategies. Here’s a fundamental sample checklist for developing a patent strategy for a new invention:

1. Why is gaining a patent necessary? How will it serve the interests of the organization?
2. Is patenting the invention worth the time and money? If we patent this invention, does it mean we will not patent another (is there an opportunity cost)? How is the value of the invention affected by a patent grant?
3. Is gaining a patent grant worth the disclosure of the technology to competitors? When do we file for the patent? Is it prudent to disclose the technology (pre-market, re-test, seek peer review, etc.) in the one-year window provided by U.S. patent law? Should we fund more research to broaden and refine possible applications before filing?
4. In what jurisdictions should we apply for a patent?
5. Who will draft the patent claims? What technical details are required and desired? What is the best use of the invention? How much do we disclose?
6. Has ownership of the invention and any related IP been legally established?
7. What are the commercial possibilities (in-licensing, out-licensing, etc.) for the invention?
8. What other IP related to the invention needs attention? What knowhow and trade secrets should not be revealed in a patent application and what steps need to be taken to protect same? If it is software, what are the copyright implications? Will the invention require registration of a trademark?

Trademarks without documentary evidence of intent-to-use for claimed goods and services are at risk

Christopher Kinkade, of Fox Rothschild LLP, writes that trademark applicants filing intent-to-use applications under Section 1(b) of the Lanham Act must have documentary evidence of their intention to use the applied-for mark in connection with the claimed goods and services. Otherwise, a registration may be canceled (or opposition to an application upheld). Wishful thinking that business operations may at some time be able to encompass the claimed goods and services is not enough. 

Kinkade suggests documentary evidence may include prototypes, draft promotional materials, business plans, presentations, minutes of board meetings where specific plans were presented, and so on.

USPTO moving to improve collection of patent assignment data

In a positive move for analysts and patent owners alike, the USPTO is considering developing a more complete record of assigned patents and applications.
A more complete patent assignment record would produce a number of benefits:

• The public would have a more comprehensive view of what U.S. patent rights are being held and maintained by various entities; 
• The financial markets would have more complete information about the IP assets being generated and held by companies; and
• Inventors and employers could better research the competitive environment in which they are operating, allowing them to better allocate their own research and development resources, more efficiently negotiate licenses, and more accurately value patent portfolios.

Here’s what the Patent Office is suggesting:

• Require that any assignee or assignees be disclosed at the time of application filing;
• Require that the application issue in the name of the assignee or assignees as of the date of payment of the issue fee;
• Require the identification of assignment changes after filing date for inclusion on the patent application publication (PGPub);
• Require timely identification of any new ownership rights that cause the application or issued patent to gain or lose entitlement to small entity status; and
• Provide for discounted maintenance fees in return for verification or update of assignee information either when a maintenance fee is paid or within a limited time period from the date of maintenance fee payment.

A key part of due diligence is establishing IP ownership. USPTO is soliciting comments by January 23, 2012. You can read the full Federal Register announcement here.