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USPTO Recap – 7 Patent Issuance Facts of 2016 [INFOGRAPHIC]

Patents have gained importance as intangible assets in an increasingly competitive technology landscape. Consequently, patent filings have shown a more remarkable increase in numbers in the past decade than ever before. In many cases the worthiness and market position of a business is valued by the IP portfolio it holds. However, patents are expensive to maintain and a company’s IP assets need to be actively managed.

This infographic features the top patent awardees of 2016 in different segments based on USPTO data. This segmentation can serve as a reference point for performing deeper analysis to support patent prosecution strategies, product marketing strategies, as well as global acquisition and licensing strategies.

uspto-recap-7-patent-issuance-facts-of-2016

MaxVal provides custom range of landscape research and analysis services customized to fit your specific use case. We work with your in-house staff or through external legal counsel. Reach us at bd@maxval.com for your landscape and competitive analysis requirements.


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USPTO Patent Issuance Report – First Half-Year of 2016

uspto-patent-issuance-report-first-half-year-of-2016

Technology growth is becoming increasingly complex and the long tail of inventions is growing day by day. Any business that comes with an innovative creation has to protect it through some legally enforceable rights, and this is where patents come into action by protecting your ideas through an extensive system that has been developed around them.

We have already crossed the halfway point of the financial year and the number of patents issued shows a steady growth.

So, do you know what’s happening in the world of patents? MaxVal has recapped all the latest US patent trends from the first half of 2016.

The total number of patents issued by the USPTO between Jan’16 to June ‘16 is 168,077

  • US is ranked highest with a massive number of 109,353 patents received so far followed by Japan 24,200, Slovakia 10,047, Germany 5,279, China 4,830, Taiwan 2,707, and France 2,202.
  • Filing for a patent with the US Government is indeed a crucial step. But, it involves a wide swath of legal formalities. The top law firms that have represented the most number of patent grants are Oblon, McClelland, Maier & Neustadt, L.L.P, Sughrue Mion, PLLC, Birch Stewart Kolasch & Birch, Fish & Richardson, and Cantor Colburn LLP.
  • Computer technology is no further behind this year than any other industry. Computer Technology, Digital communication and Telecommunications held on to the top three spots in the R&D areas with 35,464, 18,285 and 17,865 patents issued respectively. Top patent awardees in this arena were Qualcomm (542), Ericsson (828), Samsung Electronics (803), and LG Electronics (755).
  • When it comes to the tech industry, patents are their lifeblood. The number of patents filed by companies such as Samsung, IBM, Canon, and Google, proves how much these tech companies rely on patents. Some of the world’s well-known discoveries have been found through university research. Although the list is lengthy, here are few of the top research institutes like the University of California, Industrial Technologies Russia, Massachusetts Institute of Technology, and Stanford University who obtained the highest number of patents during the first half of 2016.

In today’s technologically driven world, it is imperative that every business steeped in new ideas or innovations should be more IP-aware.  The only way to keep the competitors at bay is creating a shield of strategic IP-protection to provide complete certainty that your place in the market is safe.

Download the complete report here

MaxVal provides custom range of landscape research and analysis services for in-house staff or through external legal counsel. Reach us at bd@maxval.com for your landscape and competitive analysis requirements.


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Do Semantic “Similarity” Searches Produce Better and Faster Results?

The Prior Art Search Challenge

It is difficult to identify novelty of an invention without a thorough understanding of previous work in the field. Prior art search is essential to define the boundaries between a potential invention as claimable in a patent and the published prior art. It is common practice to perform keyword-based and/or classification-based searches of the disclosed concept. Getting a comprehensive result including hidden or unexpected prior art using classic methods is challenging, particularly when working under time constraints. The quality of the search greatly depends on how much time is spent on the search, and on the technical background and skill of the searcher.

Semantic search, similarity search or citation analysis approaches could be combined to overcome the above challenges in many cases. This article emphasizes the benefits of similarity search for finding potential prior art.

Similarity Search

A number of patent databases (both public and paid) provide similarity search options. Similarity search engines may operate in one or more of the following ways:

  1. Perform text mining and machine learning to extract contextual similarities between the target patent and the assets stored in the patent databases;
  2. Search for patents that have common citations or share citations within the same family;
  3. Retrieve a list of similar records leaving out stop words and common words such as “method”, “process” or “device”;
  4. Display potentially relevant prior art documents ranked based on the relevancy.

MaxVal validated the effectiveness of a similarity search engine¹.  MaxVal conducted similarity search for a set of three patents filed under different IPCs viz. US8315756B2, US8838292B2 and US9149609B2. In each case, the similarity search retrieved a large number of patents ranked in downward order of relevancy score, starting with the most similar with 100% rating. The top results with rating above 90% relevancy were filtered using either keyword or classification-based restriction to retrieve a handy number such as 200-300 that were easy to review. In each of the three cases, the examiner-cited references were retrieved with rating above 90% relevancy through the similarity search as shown in the table below.

Target Patent

Technology Examiner Cited References

Examiner Cited References Retrieved through Similarity Search

US8315756B2 G01C 22/00

(Decentralised systems, e.g. inter-vehicle communication)

US20100121518A1
US20140039716A1
US20130325210A1
US9092987B2
US9070022B2
US8838292B2 G05D 1/00

(Control of position or course in two dimensions specially adapted to land vehicles…)

US20030225477A1
US20040024527A1
US20040254729A1
US20080269992A1
US20060106538A1
US20070043502A1
US8315756B2
US9149609B2 A61M 25/06

(Guide tubes)

US4611594A
US5074871A
US5968057A
US5688234A
US20020026203A1
US5908435A
US20020068954A1
US7169154B1
US6517551B1
US20060135987A1
US20050119668A1
US20060253145A1
US20070191878A1
US20070208351A1

In summary, similarity search augments keyword/classification-based searches and dramatically increases the quality of the results set that needs to be examined. Thus, similarity search function could enhance the efficiency of prior art search by minimizing the probability of missing relevant prior art in given time.

¹MaxVal used Questel Orbit to test the functionality of Similarity search


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Deploy Patent Prosecution Analytics to Accelerate the Product Development Cycle: A Comparative Case Study

Patent prosecution analytics can provide valuable insight into the performance of an organization’s IP operations just as other forms of analytics help in reducing cost, in making better decisions and in creating new products and services. Technology companies who are actively filing patents can achieve cost savings and faster times to grant through prosecution analytics. I will illustrate what I mean by looking at two leading technology companies with different prosecution performance – Cisco and Juniper Network.

The patent prosecution analytics can illustrate areas for improvement, how a company compares with direct and indirect competitors, patent prosecution trends, and areas the company is performing well.

There are multiple ways to measure how well an organization’s patent prosecution processes perform. MaxVal and its clients have had good success with these methods:

  • Prosecution Success Score – The number of issued cases divided by the number of abandoned cases in a given year.
  • Application Abandonment before an Office Action
  • Rate of Issued Cases with 2 or more RCEs
  • Average Pendency

To illustrate these methods and the insight they can provide, MaxVal took a look at Cisco Systems and Juniper Networks, two competitors within the Computer Communications Equipment Industry. MaxVal used publicly available data for its analysis.

Patent Prosecution Score

A Prosecution Success Score is simply the number of issued cases divided by the number of abandoned cases in a given year. The higher the score, the better it is for the company. Higher prosecution success scores can be attributed to more efficient prosecution methods, a better invention disclosure screening process, and possibly fighting harder to get patent issuance.

Prosecution Success Score
Year Cisco Juniper
2013 12.3 15.6
2014 5.9 16.1
2015 5.9 47.8

While we see Cisco and Juniper had comparable Success Scores in 2013, Juniper has continued to improve their Success Score while Cisco’s Success Score has dramatically declined. Cisco is still getting patents issued at a high rate but many more applications are being abandoned. It would be useful for Cisco to further investigate and see what the reasons for these patent application abandonment are.

Rate of Abandonment Prior to an Office Action

Another telling metric would be the rate of abandoned cases prior to receiving an Office Action. If a case is abandoned prior to receiving even a single Office Action, then it is likely that the case should not have been filed in the first place or the company did not fight hard enough for the case. An option to reduce the number of abandonment prior to an OA would be to invest in pre-filing searches to become aware of the prior art.

Rate of Abandonment Prior to an Office Action
Year Cisco Juniper
2013 1.6% 9.1%
2014 4.2% 50%
2015 5.8% 40%

Cisco seems to have a very low rate of abandonment prior to an OA while Juniper’s rate in 2014 and 2015 seems rather high. However, Juniper only abandoned 14 and 5 cases, respectively, in 2014 and 2015 so the sample size is too small to make a proper assessment of their rate.

Rate of Issuance with 2+ RCEs

The next metric to look at is the number of issued cases prior to filing a Request for Continued Examination (RCE). A high rate in this metric is a strong indicator of inefficient prosecution methods (broader claims among other things). Since the application was ultimately issued, it can be inferred that it was inefficient prosecution by the practitioner that led to a number of RCEs prior to issuance.

Rate of Issuance with 2+ RCEs
Year Cisco Juniper
2013 3.3% 12.2%
2014 6.0% 6.6%
2015 4.0% 5.4%

Both Cisco and Juniper seem to have pretty good rates in this metric suggesting that their patent practitioners use efficient prosecution methods. While Juniper’s rate in 2013 was on the higher end of the spectrum, there has been a noticeable decrease in their rate.

The final metric to look at today is the average pendency between a first OA and issuance. While looking at the pendency from filing to issuance is a normal metric to look at, it doesn’t give the best insight to prosecution methods. Much of the time from filing to first OA is a result of the patent office delays in working on the application. So, a better indicator of an applicant’s prosecution methods is to look at the time from the first OA to issuance. A higher pendency can be attributed to receiving more OAs, taking longer to respond to OAs, and filing RCEs.

Average Pendency from OA to Issuance

Average Pendency from OA to Issuance
Cisco Juniper
Overall 13 months 18 months

As evidenced by the table above, Cisco seems to be getting their applications issued, on average, 5 months quicker than Juniper. Juniper should look closer at factors that can be attributed to this increase in pendency.

Overall Cisco and Juniper seem to employ reasonably efficient patent prosecution practitioners and methods. They both have high issuance rates and low abandonment rates. Cisco’s low abandonment prior to OA rate indicates a good invention disclosure screening process. And the low rate of issuance with 2+ RCEs indicates efficient patent prosecution methods.

These metrics, and others, illuminate a company’s patent prosecution process strengths and weaknesses. It allows companies to see how their competition is faring and what areas they need to improve.

By Bharath Venkat, MaxVal

patent renewal rates


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Patent Renewal Rates under Different Renewal Period Schemes

by Bharath Venkat

In order to keep a US patent in force, the US Patent & Trademark Office requires that patent owners make maintenance fees at years 3.5, 7.5 and 11.5 after grant. This is in addition to filing, search, examination and post-filing fees.

Other patent issuing authorities use different rules. For the European Patent Office (EPO), maintenance payments must be made annually and cannot be pre-paid. For Japan (JPO) and the Korean Intellectual Property Office (KIPO), fees are due annually and can be prepaid.

If the patent owner decides not to pay the maintenance fee, then the patent owner loses the patent rights and the patent reverts to the public domain. If a patent is abandoned, the term of the patent is shortened and patent protection ends well before the maximum life of the patent. At MaxVal, we have compared abandonment rates for US, European, Japanese and Korean patents. Our goal is to see if abandonment rates differ between single year or multi-year renewal countries.

patent renewal ratesAnalysis of Lapse Rates

A good indicator of this could lie in the rates that patents lapse due to nonpayment of renewal fees. As seen in the graph below, different patent annuity systems yield different lapse rates.

Looking at the US – in 2014, 50.7% of active patents were renewed for the Third Stage (11.5 years). Since payment of the Third Stage gives those patents protection from years 12-20, it can be said that 50% of patents filed in the US are active for the full 20 years of the patent term.

This lapse rate is much different than in patent offices that require annual patent fees that cannot be paid in an advance lump sum like the EPO. In 2010, only 50% of active patents were renewed for the 8th year of the patent term. Only 42% of the patents are renewed beyond the 12th year of the patent term. Furthermore, only 33% of patents were renewed beyond the 15th year. Only about 17% of patents are active for the entire 20-year patent term. These statistics indicate that patent owners were very wary of paying higher annuity fees and were able to judge if the patent was economically viable on a yearly basis. This arguably led to a higher percentage of patents lapsing and entering the patent domain much earlier than in the US.

Additionally, patent offices that accept advanced lump sums of annual fees, like JPO and KIPO, have different renewal rates as well. At the JPO, the number of renewed patents only dropped to 50% after 17 years of the patent term. Also, 33% of patents were renewed throughout the 20-year patent term. At the KIPO, the number of renewed patents only dropped to 50% after 13 years of the patent term. However, the patent renewals drop to 33% after the 16th year of the patent term. These statistics indicate that, if allowed to, patent owners are more likely to pay their maintenance fees in advance, which would prevent the lapse of patents that are economically not viable.

Conclusion

For patent owners, annual renewal schemes seem to offer greater flexibility for making renewal decisions. When fees are payable annually, patent owner have more control over what to keep than they do in the US system.

From the perspective of a patent office, it would appear that forcing patent owners to make multi-year commitments increases renewal income. So, a multi-year scheme is beneficial for the patent office.

Owners of US patents should take care at the Third Stage. The data suggests that some patents that are routinely renewed at 11.5 years should be considered for abandonment. Those patents would be soon abandoned under an annual renewal scheme – but that option is not available in the US.

*Sources:

  1. 2014 USPTO Performance and Accountability Report
  2. Four Office Statistics Report 2010

MaxVal offers the Annuity Payer service to help companies plan and execute fee payments.

IP5 Global Dossier


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The New Game Changer – IP5 and Global Prosecution Data

It has been over fifteen years since the release of Private PAIR. It was one of the most significant technical achievements by the USPTO and one of the major milestones in the patent data revolution by allowing electronic patent filing and data access.

Although a real game changer fifteen years ago, as anyone who tried to get through the latest Java updates to access Private PAIR (especially on a browser other than FireFox) can attest, Private PAIR is far from cutting edge in 2016.

Make no mistake; PAIR is still the bread and butter for US patent practice operations and a valuable source for patent prosecution data. However, today’s savvy IP Managers are looking for additional tools and data to elevate their IP management.

One of the major reasons why PAIR is no longer the game changer that it once was is the internationalization of patent portfolios. US patent data is simply no longer enough to provide the complete view of patent portfolios. For many companies, a significant portion of their portfolios are now non-US patent assets.

One indicator of the importance of non-US patent filings is the PCT national phase filings. Based on the latest WIPO data, although US is the single most popular national phase filing destination in 2014, the total number of national phase filings in four popular non-US patent offices (China, EP, Japan and Korea) is now more than twice the number of US filings (128,946 US filings vs. 267,688 non-US filings).

PCT national phase filings in China, Europe, Japan, Korea and US in 2014PCT 2014

Country

Number of national phase entries in 2014

China 79,612
Europe 92,627
Japan 58,337
Korea 37,112
United States 128,946

Table and Graph 1: PCT national phase filings in China, Europe, Japan, Korea and US in 2014 from WIPO IP Statistics Data Center http://ipstats.wipo.int/ipstatv2/index.htm?tab=patent.

The top five Patent Offices (IP5) have recognized this internationalization phenomenon and many directives have been introduced to facilitate cooperations between the patent offices. Perhaps the most significant since the PCT itself is the IP5 Co-operation.
IP5 CountriesIn their own words, IP5 is the name given to a forum of the five largest intellectual property offices in the world that was set-up to improve the efficiency of the examination process for patents worldwide (www.fiveoffices.org).

The members of IP5 are:

To IP Managers, the most immediate impact of IP5 is the efforts to facilitate greater integration of the global patent system through sharing of patent data. For example, the IP5’s Common Citation Document (CCD) application now allows access of up-to-date citation data of all five patent offices.

Perhaps even more impactful is the IP5 Global Dossier Service, which integrates prosecution data of EPO, JPO, KIPO, SIPO, and USPTO. For the first time, IP managers can now have a global view of prosecution history and status of five most popular patent offices that accounts for a vast majority of patent filings.

This global view that is now available to IP managers is the true game changer of intellectual asset management in 2016. Successful harnessing of this technology, especially in combination with private PAIR, will provide IP Managers the correct, current and complete view of their patent portfolios, and thereby allowing them to take informed actions and perform meaningful analytics.

Steven Gong, JD, MSCE
Director, MaxVal, SymphonyIAM Product Manager
SymphonyIAM_Sign

 

 


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Open Innovation Insights from Experts Paul Germeraad and Wim Vanhaverbeke

Open Innovation is a rapidly evolving methodology for accelerating new product development. Rather than developing innovations and new technologies secretly in a corporate laboratory, firms embracing Open Innovation actively seek new ideas from outside the firm and actively solicit ideas for their toughest challenges.

According to Wikipedia:

The central idea behind open innovation is that, in a world of widely distributed knowledge, companies cannot afford to rely entirely on their own research, but should instead buy or license processes or inventions (i.e. patents) from other companies.

Companies who have successfully implemented Open Innovation programs include AkzoNobel, P&G and GE.

Paul Germeraad is a member of MaxVal’s Intellectual Assets, Inc. (IAI) consulting unit. Paul is a recognized leader in the R&D and Licensing community.  He has helped many companies improve their R&D programs and IP Management practices.  He has seen through personal experience and the efforts of others what works and what does not. According to Paul,

When done right, Open Innovation can create huge new business opportunities! Since finding the needle in the haystack is the critical issue, our IAI practice can help any research intensive business make Open Innovation work alongside internal exploration options

Together with Wim Vanhaverbeke, business professor at Hasselt University, Paul has written a significant white paper on “How to find, assess and value open innovation opportunities by leveraging IP databases?

Paul and Wim observe that while Open Innovation initiatives are widespread, they do not always produce the desired results.  The paper places Open Innovation in the larger context of the firm’s overall strategy and patent management process.  It then provides specific suggestions for answering these three questions:

(1) How to find the right technology and partners in the available mountain of information?

(2) How to use new patent databases and patent analysis software tools to improve the speed and quality of finding exactly the right technology and partners?

(3) How to negotiate access in an equitable and timely manner after finding desirable technology and partners?

The paper includes a detailed example based on finding membrane technologies relevant to environmental protection and clean-up.

If you are interested in accelerating product development, we invite you to review Paul’s paper.

MaxVal’s Intellectual Assets consulting group offers services specifically tailored to help companies establish successful Technology Scouting and Open Innovation initiatives.  For more information, see Technology Scouting and Open Innovation.


Patent Litigation Analytics – Report on Judges in 2014 cases


Why do We Pay Maintenance Fees?

Patent maintenance fees continue to increase. However, once the patent has issued, the USPTO does not provide any ongoing services to the patent holders. Therefore patent holders are correct in wondering why they must pay patent maintenance fees and why the fees are increasing. The requirement of maintenance fees has both economic and public policy reasons. First, maintenance fee revenue is used to fund the operations and expenses of the USPTO such as the examination of new patents. Second, maintenance fees allow for the promotion of progress of science and useful arts.

Funding the USPTO

The net cost of the USPTO program in 2014 was $2.73 billion. This was a 7.6% increase from the 2013 program costs. Additionally, the costs for the Patent business of the USPTO have increased 38.5% since 2010.  To combat this growing expense sheet, the USPTO must raise funding.

Maintenance fees are a big part of the USPTO revenue. Maintenance fees accounted for 41.4% of the USPTO’s $3.02 billion revenue in 2014.  The revenue generated from maintenance fees has increased by 49% from 2013 to 2014. This increase was preceded by a 20% increase in maintenance fee revenue from 2012 to 2013.Thanks in large part to the maintenance fees, the USPTO was able to have a net income of $290 million.

It is clear that without the maintenance fees the USPTO would be operating at a loss. The cost of collecting maintenance fees is low, whereas the USPTO is incurring most of their costs in the patent application examination process.

Foster Progress of Science and Useful Arts

This is unequivocally the goal of patent law as stated in the Constitution and maintenance fees have a strong impact in achieving this goal. The underlying public policy of collecting maintenance fees is to make technology available to the public as soon as possible.

Escalating maintenance fees force patent owners to decide if the patent warrants higher future maintenance fees. If a patent holder decides that a patent does not warrant the next maintenance fee, then the patent will be abandoned which frees the patent to the public.  Not only does this allow the public to gain free access to the patented invention but it also prevents patent holders from squatting on a patent to a certain extent. The statistics show that maintenance fees have continued to be a deterrent to squatting on unused patents.

In 2014, 91.8% of patents were renewed at their First Stage. The number of renewed patents dropped to 78.8% for the Second Stage. Furthermore, only 50.7% of patents were renewed at the Third Stage.  The First, Second, and Third Stage refer to the maintenance fee deadlines in the 3.5, 7.5, and 11.5 years of the patent term. These patent renewal rates have remained comparable and without much fluctuation since 2010.

It is evident  that many patent owners cannot justify paying the 3rd maintenance fee for a patent. Increasing the maintenance costs would only (which are discounted by 50% for small entities) further this goal of promoting progress of science since it forces patent holders to make a rational decision in regards to their patent.

Written by: Bharath Venkat, J.D.


Patent Litigation Analysis for Golden Bridge Technology, Inc.