New U of Penn research sheds light on the shift from first-to-invent versus first-to-file

What’s the impact of the America Invents Act proposed shift in patent priority rules from first-to-file to first-to-invent?  University of Pennsylvania researchers studied Canada’s transition to a first-to-file system in 1989 with these key findings:

• a substantial drop in the fraction of patents granted to small inventors coincident with the implementation of first-to-file.
• reduced patenting behavior by individual inventors
• policy implications based on the relative value of inventions by small inventors.

Opponents to Canada’s shift to first-to-file say it actually harms the entities that create the most jobs.  First-to-invent advocates, obviously, believe inventors are rewarded rather than the winner of the race to the patent office. 

Will the first-to-file system prompt costly and lengthy interference proceedings to determine who conceived an invention first?  If that happens, the expense of such proceedings will prove prohibitive to most small inventors.

Knowing precisely how U.S. inventors will react to a first-to-file system can be surmised from the University of Pennsylvania study.  Hopefully U.S. Representatives and Senators, at minimum, read the study before casting their final vote.  Still, the sad fact is that wealthy litigants can defeat small patent filers, whether the legal investment is to file quickly, or create a record showing previous invention.

Will Google experience reputational risk for its Canadian drug ads?

Google agreed to pay a $500 million fine for its online ads from Canadian pharmacies to illegally sell prescription drugs like Allega, Zyprexa, Levitra, Cialis, and Lipitor, etc. to American consumers.  Google used the company’s AdWords service to aid marketers advertise the drugs to U.S. buyers.

Reputation risk expert Dr. Nir Kossovsky of Steel City Re says while:

Google’s activity has attributes of reputation risk, it lacks large scale adverse notoriety.  In other words, Google’s stakeholders hold the firm in high regard and don’t expect nor do they see evil in Google’s actions, especially since it promptly halted the practice.

Kossovsky says however, “any reputation risk today left unchecked and unmonitored can produce adverse effects that cascade throughout an enterprise, its value-supply chain, and stakeholders”.

IPVW’s upcoming webinar Reputation: Business Case For IP Professionals will delve into this issue and provide answers and solutions.  The webinar features Dr. Kossovsky.

Recent patent auctions and sales: it’s more than merely acquiring patents!

BVR’s IP Blog has written extensively about the Nortel patent auction and Google’s more recent purchase of Motorola Mobility and its patents.

“The patents are really just the tip of the iceberg,” says Mary Adams, president, I-Capital Advisors.  “There are many forms of knowledge and intangible assets embedded in each patent like human capital, research, partnerships, product knowledge, and production capacity. As Google unravels and evaluates the content of each patent that’s what they’re going to find,” Adams predicts.

Adams is troubled by the notion that “if patent buyers don’t know all of the intellectual capital embedded in the patents being purchased, how can they do a good job of managing the patents after the deal closes?”

To learn Adams’ answers and solutions to identifying, unraveling, and extracting value from intellectual capital embedded in patents consider BVR’s upcoming webinar Analysis of the Intangible Drivers of Company Value.  Her webinar will bring clarity and solutions to these issues that are now integral to every business transaction, partnership, and alliance.

We’re going to learn soon what intangible assets are worth—once the tangible assets are gone

Borders is set to sell its intangibles next week.  These include its the rights to its brand name, logo, website, trademarks, and customer information including email names and purchasing history.

Rick Rosenbloom, a principal with Fuel Break Capital Partners stated

I think the Border’s sale could be a litmus test as to whether the old economy brands disassociated with their original purpose are valuable in the new economy.

Ken Jarboe, president of Athena Alliance, a Washington intangible economy think tank says

while brand and domain names are only a partial measure of Border’s intangible assets, with the recent fights over mobile telephony patents reaching a fevered pitch, it is hard to say, but the Border’s sale may serve as an indicator of intangible value.

IPVW can’t agree more.  With 65+% of most company’s value today evolving directly from intangible assets, Border’s sale on September 14th will be an event the entire IP community will be watching.  IPVW will be here to offer its analysis of the outcome.

Upcoming Events

Valuing Sports Franchises
September 15, 2011 10:00am - 11:40am PT
Featuring: Drew Dorweiler

Analysis of the Intangible Drivers of Company Value
September 20, 2011 10:00am - 11:15am PT Featuring: Mary Adams

Patent Damages: The Entire Market Value Rule
September 22, 2011 10:00am - 11:40am PT Featuring: Craig Jacobson and Stephen Lieb

Reputation: Business
Case For IP Professionals
October 13, 2011
10:00am - 11:15am PT Featuring: Dr. Nir Kossovsky

Life and Death of Businesses: Firm Mortality and Business Valuation
October 26, 2011
10:00am - 11:15am PT Featuring: James Morris

Advanced Workshop on Valuation Issues Under ASC 805 and Business Combinations
November 3, 2011
10:00am - 2:00pm PT Featuring: Mark Zyla