[BLT] Management of Patent - How to reinforce your company's IP capacity

Business, Law & Technology
BLT
BLTBusiness, Law & Technology Jeonghan Eom
Management Of
Patent (MOP)
September 24, 2013
Korea INtellectual Property Association
Presentation for Division of Small & Medium Business Seminar
Jeonghan Eom, patent attorney
shawn@blte.kr / +82-70-4100-0102

BLTBusiness, Law & Technology
BLT
Jeonghan Eom
• Graduated from Seoul National University, School of Chemical and Biological Engineering
• Microsoft Certified Professional
• Certificate of Industrial Engineer Information Communication (2001)
• Worked at Picosoft Co., Ltd.
• Patent Attorney, Republic of Korea (2006)
• Instructor for ETRI Patent Coordinator (2013)
• [Public Procurement Service]
Panel for excellent goods designation
• [Korean Intellectual Property Office]
Panel for excellent inventions recommendation
• [Korean Intellectual Property Office]
Panel for College Creative Invention Competition
• [Korea Patent Attorney Association] trainee member
• Instructed at Seoul National Univ., Konkuk Univ., Inha Univ. (invention and patents, etc.)
Introduction
2
Eom, Jeonghan
(patent attorney)
Yoo, Cheolhyun
(patent attorney)

BLT
Jeonghan Eom
Many entrepreneurs take concerns on the MOP
for improving competitiveness for the
future, seeing patent disputes between Samsung
and Apple. With abundant knowledge and real
experience from the author, this book will provide a
good guidance on the MOP.
Wonil Cho,
President of Onestop Solution
A patent is not just a cost, but rather an
investment for future earnings of an enterprise.
This book contains methods of transforming into
MOP companies making licensing profits, based
on good inventions and strong patents creation.
Jeonghwan Lee,
Chief of Patent Center at LG electronics
Management of Patent (MOP)
3

BLT
Jeonghan Eom
Patent & Trademark management system
(www.ipems.com)
Features of the IPEMS
• Patent and trademark management system
• Very Easy to Use
• Due date management
• Auto e-mail sending
• Agent (patent office) management
• Competitors analysis
• An agent can access and enter information
• Local installation / Cloud service both available
Delivery Record
• Hyundai Mobis
Further information /
demonstration request
• Jeonghan Eom shawn@blte.kr
4

BLT
BLTBusiness, Law & Technology www.BLTe.kr 5
Why the dispute, Apple vs. Samsung?

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Why did the Apple vs. Samsung lawsuits occur?
6

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7

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8

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CREATIVE’s movement  light, thin, short, and small
9

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The passing over of Steve Jobs
1. A method of selecting at least one track from a plurality of tracks stored in a computer-
readable medium of a portable media player configured to present sequentially a first,
second, and third display screen on the display of the media player, the plurality of tracks
accessed according to a hierarchy, the hierarchy having a plurality of categories,
subcategories, and items respectively in a first, second, and third level of the hierarchy, the
method comprising:selecting a category in the first display screen of the portable media
player;
displaying the subcategories belonging to the selected category in a listing presented in the
second display screen;
selecting a subcategory in the second display screen;
displaying the items belonging to the selected
subcategory in a listing presented in the third display screen; and
accessing at least one track based on a selection made in one of the display screens.
10

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The passing over of Steve Jobs
Infringement!?
11

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Apple’s lawsuits were absolutely timely
Time
Value
Market demand
for Smartphone
Patents were
registered with
struggle
Feb 2006
$100 mil settlement
with Creative
Concept patents
(UI part)
were applied
in quantity
Competitors
made copies of
its UI
in quantity
Apr 2011
Apr 2006 -
June 2007
iPhone 2G
was released
Oct 2008
Apple’s
Concept patents
(UI part)
applications
were released
Oct 2008 -
12
(* 너 고소 = Sue you)

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13
Infringement!?

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14
Workarounds!?

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When patents make fun...
In which case do patents show
most dramatic effect?
① New items
② Business do grow really fast
- Competitors say ‘that’s cool!’
③ You (already) have patents endurable through
litigation
④ Copycats appear in short period
15

BLT
By BLT patent & law office

BLT
Jeonghan Eom
① Companies do not grow further since their patent competitiveness is weaker
compared with the size.
② Your competitors finished designing patent portfolio and are continually struggling
to obtain essential patents even now.
③ Patent competitiveness is the key to the survival of technology companies.
 Your company will be relegated to an OEM unless patent competitiveness
improves; you will soon be substituted with competitors.
The Book’s Conclusion
• Few or no patents
• High productivity
• Subordinate to big
companies
• High probability of
replacement
• Earnings from
production are 100%
 most small and
medium enterprises
OEM company
In-house
production
company
• Small number of
patents
• High productivity
• Emerging from
dependence
• Competitors may enter
the market
 most listed companies
Patent holding
company
MOP company
• Number of patents
rapidly increase
• Patent competitiveness
quickly grow
• Have experienced
getting sued
• Own technology pool is
built up
• Patent portfolio is being
developed
 Companies that run
patent teams
• Strong patent
competitiveness
• Licensing cases are
increasing
• Starts to file a lawsuit
• Standard pool is formed
• Innovative earnings is
rapidly increasing
licensing teams
features
17

BLT
Jeonghan Eom
• Full-time patent manager should introduce MOP (Management of Patent) to the company.
MOP (Management of Patent)
M
O
P
What is patent application good for?
When will it be effective?
Why should patent personnel be
recruited?
Isn’t International application expensive?
Sure, patent makes money!
① A manager himself/herself must be in
confidence.
② The confidence should be delivered.
③ Think how to make money with patents.
④ Practice the method of increasing patent
competitiveness.
18

BLT
Jeonghan Eom
• Patent competitiveness is an index that shows how the outcome of R&D from
companies (universities, research labs) is well processed into powerful intellectual
property (IP) and is held by companies.
• Patent Competitiveness = (Patent Deterrent)+ (Patent Offense Power)
Patent Competitiveness (Not contained in this book)
Patent
Competitiveness
(patent value)
(company’s size)
(ability of patent manager)
α
• The equation is not complete (at all)  Please take part in getting it done
• additional factors : revenue, number of licensing, licensed patents, number of disputes,
number of international application, (quality of patent??)
19
=

BLT
Jeonghan Eom
• Patent competitiveness of Korean companies in terms of patent number?
Patent Competitiveness
* Not exact numerical figures
20

BLT
Jeonghan Eom
Worries that makes patent manager troubled
Samsung and LG will support us
Sales line is more important than patents
Patents cannot defense our market
Are our company’s patents really useful?
Excel will do for patent management
Researchers are busy
Just focus on production!
Full-time patent
manager
MOP theory
is needed!
21

BLT
Jeonghan Eom
• Japan’s Trinity strategy is a theory too abstractive, academic and difficult to apply
for the practical use.
Another MOP theory <1>
http://blog.naver.com/PostView.nhn?blogId=wipsmaster&logNo=50156791045
22
Patent
Strategy
Business
Strategy
R&D
strategy
Business strategy is linked to R&D
strategy, thus constructing patent strategy
• Deciding either to file an application or to keep
as a trade secret
• Qualitative growth of patent acquisition by
selection and concentration
• Prior art search at the point of R&D, patent
application, request for examination
• Creating a patent map to investigate
competitors’ move
• Using the patents
Connection with Business
Strategy
• Using patent information as the
basis of business decision such
as entering a new market or
forming an alliance with other
companies
• Securing rights as offense,
defense, and prevention
Connection with R&D strategy
• Using patent information for analyzing own
technology or setting forth R&D themes
• Using patent information as the basis of
selecting partners for cooperative R&DTrinity
Strategy

BLT
Jeonghan Eom
• Patent creation/protection/utilization model contributed to systemization of contents needed
for IP strategy.
Another MOP theory <2>
http://www.bioin.or.kr/board.do?cmd=view&bid=patent&num=188422
23

BLT
Jeonghan Eom
• Patent competitiveness can be enhanced through 4-step MOP strategy.
• Unlike the existing theories, time-series approach is emphasized.
4 Steps of MOP
Introductory
stage
Quantitative
Expansion
Qualitative
Expansion
Management
of Patent
(MOP)
24

BLT
Jeonghan Eom
• Licensing team
 dealing expert
• infringers are
constantly analyzed
(compensation is paid
for the discovery of
infringement)
• researchers are paid
with compensations for
the licensing or
disposal of patents
• patent task force team
+ CIPO
• patent analysis
• international
application
• competitors are
constantly analyzed
• patent map
competition(!!!)
• full-time
personnel, patent team
• a written notice for
invention is mandatory
• compensation for
employee invention
• advanced patent
education for
researchers and
• additional patent post
is assigned to the
existing manpower
• Invention technique
education
• basic patent training
• prior art search
training for
researchers, etc.
• In 4 steps of MOP, tasks to be focused on differ in each step.
4 Steps of MOP – mission for each step
MOP
Qualitative
Expansion
Quantitative
Expansion
Introductory
Stage
Invention creating
Patent creating
Patent analyzing
Market dominating
25

BLT
Jeonghan Eom
• A 4-step strategy to become an MOP company is as follows. (for details, refer to the book)
Growth strategy in MOP
• Dominating ability is
reinforced
• Licensing strategy
• A notice of warning
is sent to latecomers
• regular monitoring
• active litigation
• Consilience of
patent/planning/
strategy
• Analyzing ability is
reinforced
• Analysis of
competitors
• Analysis of own
patents
• Improving own
patents
• International
application
• Actions against
core patents
• Application ability
is reinforced
• Patent application
is promoted
• Even class C
patents!
• Merit system is
introduced
• Employee
invention
compensation
• Inventing ability is
reinforced
• Creativity led
culture
• Thinking of trend
• Concealment
• Invention
Workshop
Management of
Patent (MOP)
Qualitative
Expansion
Quantitative
Expansion
Introductory
Stage
26

BLT
Jeonghan Eom
• A 4-step strategy to become an MOP company is as follows.
Growth strategy in MOP
• Dominating ability is
reinforced
• Consilience of
patent/planning
• Analyzing ability is
reinforced
• Actions against core
patents
• Patent application
ability is reinforced
• Employee invention
• Invention ability is
reinforced
• Invention workshop
Management of
Patent (MOP)
Qualitative
Expansion
Quantitative
Expansion
Introductory
Stage
OEM company
In-house
production
company
Patent holding
company
MOP company
• Few or no patents
• Subordinate to big
companies
• High probability of
replacement
 most small and
medium enterprises
• Small number of
patents
• Competitors may enter
the market
 most listed
companies
• Number of patents
rapidly increase
• Own technology pool is
built up
• Have experienced
getting sued
patent teams
• Strong patent
competitiveness
• Licensing cases are
increasing
• Innovative earnings is
rapidly increasing
licensing teams
27

BLT
Jeonghan Eom
• Multinational companies achieved lawful market dominance throughout the
4-step Management of patent (MOP) process.
• MOP companies can retain sustainable growth.
• Through the MOP, companies can know which (formidable) latecomers they should acquire
by means of M&A.
 Pin Point Patent Analysis Like Microsoft, Apple
Effect of MOP
28

BLT
Jeonghan Eom
• NPEs already transcended the 4 steps of MOP and possessed lawful weapons.
• NPEs can sustainably grow since they are specialized in MOP.
• Through the MOP, companies can know which (formidable) latecomers they
should acquire by means of M&A.
 Pin Point Patent Analysis Like Intellectual Ventures, Rockstar Bidco
Revolution of MOP = NPE
29

BLT
Jeonghan Eom
• NPEs could jump over the 4 steps of MOP since they escaped from <production>
and only focused on the <patent value>.
• ① NPEs that practiced the ‘Patent Value Strategy’ reached IPOs or high profit;
② NPEs that did not do are suffered from the pressure from VCs
 They attack poor Korean companies
Revolution of MOP = NPE
introductory
stage
quantitative
expansion
qualitative
expansion
Management
of Patent
(MOP)
30

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BLT
Jeonghan Eom
Patent Manager
32
Samsung and LG will support us
Sales line is more important than patents
Patents cannot defense our market
Are our company’s patents really useful?
Excel will do for patent management
Researchers are busy
Just focus on production!
Patent manager should show
a <strategy that a patent
makes money> to CEO
Or, at least,
PM is to suggest
a <strategy that
competitors’ patents should
not disrupt our business>

BLT
Jeonghan Eom
Or, at least,
PM is to suggest
a <strategy that
competitors’ patents should
not disrupt our business>
33

BLT
Jeonghan Eom
Way of patent strategist
삼성, LG가 우리를 먹여살릴 것이다.
특허로 시장을 방어할 수 없다
(money making by patents)
Patent Manager
Park, Patent Attorney
(LG electronics → Intellectual Discovery)
Patent manager should show
a <strategy that a patent
makes money> to CEO
MOP
qualitative
expansion
quantitative
expansion
introductory
stage
Earnings from
Licensing
$3 mil
 $30 mil for 10
years
International
applications increase
Participates
standard conference
OA Value Up
H.264 patent
(100 times
increased)
+ patent team
expanded
H.264 patent
(2 discovered)
+ discovering
Researches
34

BLT
Jeonghan Eom
• Company’s earnings are divided into ①production earnings and ②innovative earnings.
• Most companies do not make innovative earnings and are undervalued.
• Innovative earnings have no raw material (cost) or circulation cost, thus it can be
multiplied through contracts/marketing.
• For companies to create innovative earnings, licensing team should be set up.
Way of patent strategist
Production Earnings
• Earnings from the value chain of
production of goods
• It fluctuates depending on market
situation
• It suffers when just a part of the value
chain has any problem on it.
• Researchers, production employee,
factory, distribution line, sales line, etc.
• Subcontractor, multinational company
Innovative Earnings
• Earnings from patents or design
IPs
• Its value is determined by
contract or marketing
• Regardless of the value chain, it
can be maintained
• Only researcher and licensings
needed
• Multinational company, patent
specialized firm (NPE)
Company’s
Earnings
35

BLT
Jeonghan Eom
• Elias Howe Jr (1819 - 1867)
• In a dream, the natives tried to poke
him down with spears with holes in
the points... He got an idea, and
completed the sewing machine.
• The machine being released, it did
not attract the market first
time, driving him to go to Britain.
• With several lawsuits, Howe’s rights
were confirmed in 1854.
• Until the patent right was expired in
1867, he enjoyed great sum of
royalty from every sewing machine
produced in the United States.
World’s first patent strategist
36

BLT
Jeonghan Eom
1. Quality of production and novelty of
an idea are totally different (I. M. Singer
= high quality)
2. You can earn money with only ideas.
Focus on research if you cannot
produce goods of quality. ($4,400 royalty
for each day)
3. Innovative earnings do not break out
immediately. Just sit down and wait
for the inflection of the market.
(Howe’s exile to Britain then glorious return♬)
World’s first patent strategist - lessons
+ Patent troll(NPE) existed even 200 years ago!
37

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By Oh Byung Seok (Base) + BLT (Adapt)

BLT
Jeonghan Eom
Time
Market needs
against technology
Value per patent
Value
Strong
patent
Convenience,
Diverse technology
Strong
patent
Productivity
increasing
technologies
• In Oh Byung Seok’s book <Patent Value Strategy>, strategies for patent value are
presented in detail.
Patent Value Strategy
* Oh Byung Seok,
Patent Attorney
39

BLT
Jeonghan Eom
Time
Market needs
against technology
Value per patent
Value
Strong
patent
Strong
patent
Productivity
increasing
technologies
• Finding the inflection of <market demand> is the core of Patent strategy.
Core of Patent Value Strategy
* Oh Byung Seok,
Patent Attorney
Original
technology
① Standardization
② fashion
① Chicken
Game
40

BLT
Jeonghan Eom
Time
Value
Productivity
increasing
technologies
• Pay attention to patents from technological areas where 3D semiconductors are
produced/ examined/ researched/ packaged/ used!
Promising patent dispute area <1> =
3D Semiconductor Equipment
41
* Personal imagination

BLT
Jeonghan Eom
Time
Value
• Pay attention to patents from Architect / Interface / Applied technologies of next
generation operating systems!
next generation OS technology
Original
technology
42
* Personal imagination

BLT
Jeonghan Eom
• Pay attention to patents from Architect / Interface / Applied technologies of
next generation operating systems!
• Next generation OS is highly likely to be an <unseen operation system>
• PC-based OS  Mobile OS  Glass OS (relating hardware, Codec, App, etc.)
next generation OS technology
43

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Patent buying strategy
Time
Value
Strong
Patent
Convenience,
Diverse technology
Strong
Patent
44
Patents to buy

BLT
Patent buying strategy
Time
Value
Strong
Patent
45
Patents to buy
① Patents that university/
government-funded institute hold
- comparatively low cost
- co-research is available in future
- they invite gov-led R&D projects
②Patentsthatcorporationshold
- merge and acquire small companies
- acquire patents of bankrupt firms
- buy overseas patent at bargain
- fortunately, acquire essential patents

BLT
Jeonghan Eom
• What does an NPE do?
• MOP(management of patent) companies and NPEs(patent specialized firms)
have the same structure for innovative earnings.
MOP company vs patent specialized firm
① Analyzing competitors’ patents
② Creating/Investigating patents for standard technological areas
③ Acquiring valuable patents (or companies) (by M&A, etc.)
④ Licensing the patent portfolio
⑤ Filing a lawsuit against the adversary that rejects licensing
• MOP company = Innovative earnings + production earnings
• Patent specialized firm = Innovative earnings
46

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A case of MOP companies – Gillette
47

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A case of MOP companies – Gillette
• Released in 1990
• No.1 for 10 years
• 70% of world market
• +10 year R&D
• $200 mil investment30 Comprehensive
patents
(for every line-ups)
48

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A case of MOP companies – Gillette (patent portfolio constructed)
49
Set limits (in detail) to subject’s range!

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50
US 5,010,646
US 5,027,511
US 5,430,939
US 4,813,131
US 4,785,534 US D377,237
US 5,113,585

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51

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Another case: HAAN steam cleaners
52
• Dominated the market for 8 years
• $100 mil annual revenue
• 10 mil steam cleaners sold
• Has grown to a mid-sized strong
company
How many patents for steamers?

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53

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54
Steam cleaner
original patent

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55
813,538 813,537 813,539
401,327
793,413
881,943 776,841 734,569

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56
Time
Value
Strong
Patent
Convenience,
Diverse technology
Strong
Patent

BLT

BLT
Jeonghan Eom
• A simple technique to apply without effort to memorize sophisticated methods
• A new invention method by Five Ws and one H is devised (starts at ‘which part of what’)
• Using the 6HA, its user can grasp products to make and the hidden needs of the market.
6HA Invention method
58
What
(which
part of
what)
Who
When Where How
Why
Finding
items
*Start
*Finish
*R&D
* Materialization of invention
*Market needs

BLT
Jeonghan Eom
• 6HA invention workshop for companies is now available
(4 doctors of engineering, 5 patent attorneys)
• ① for researchers ② discovering new needs ③ competitors’ patents
Invention Workshop using 6HA Invention method
59
How to discover potential demand of market
by 6HA invention method (example)
6HA Invention workshop
registration / questions:
• Jeonghan Eom
shawn@blte.kr

BLT
Jeonghan Eom
• Educating researchers how to invent is more effective than compensation for employee
invention.
• Major product is split into components; problems are identified then.
Invention Workshop using 6HA Invention method
60
What product should we invent?

BLT

BLT
BLTBusiness, Law & Technology Jeonghan Eom62
4 steps of MOP
MOP
Qualitative
Expansion
Quantitative
Expansion
Introductory
Stage
Missions for <Introductory stage>
• Patent management position
should be assigned to the existing
manpower
• Patent education /
Invention education
• Invention competition (It’s Fun~!!)
• Prior Art research education
Effects
•Creative culture
•Motivation
•Motive for
technology
development
Not urgent?
First, do things not expensive...

BLT
4 steps of MOP
MOP
Qualitative
Expansion
Quantitative
Expansion
Introductory
Stage
Missions for <Quantitative Expansion>
• Full-time patent manager positioned
• a written notice for
invention is mandatory
• Compensation for
employee invention is introduced
• Researcher’s patent creation ability
is beefed up
Effects
• Number of
application increases
• Researcher’s
confidence increases
• Number of cases
applying tech
increases
Patent application fees
are burdensome?
Find a suitable
patent law firm

BLT
4 steps of MOP
MOP
Qualitative
Expansion
Quantitative
Expansion
Introductory
Stage
Strategic Application
-Number of application decreases
-Cost per application increases (VU, international application)
Patent Application Expansion
- Number of application increases
- Cost per application minimized (KR application, PCT only)

BLT
4 steps of MOP
MOP
Qualitative
Expansion
Quantitative
Expansion
Introductory
Stage
• All IPs that attacked Samsung
were applications filed at the step
of <Quantitative Expansion>.
• After that, Apple did M&A and
bought NORTEL at the step of
<Qualitative Expansion>
• Apple initiates its strategy
through Rockstar Bidco LP, etc.
at the step of <MOP>
MOP
Qualitative
Expansion
Quantitative
Expalsion

BLT
IPs Apple brought forward disputes with Samsung
7 Patents
7,812,828
7,669,134
6,493,002
7,469,381
7,844,915
7,853,891
7,863,533
IPs of
Quantitative
Expansion
66

BLT
4 steps of MOP
MOP
Qualitative
Expansion
Quantitative
Expansion
Introductory
Stage
Effects
• Secure
patent deterrence
• High quality patents
are created
• Patent disputes are
prevented
in advance
No earnings right now
Appealing that money is saved
Missions for <Qualitative Expansion>
• Patent task force is established
• Producing strategic patents
for the value up
• Competitors are constantly analyzed
• Researcher’s patent analyzing ability

BLT
Qualitative Expansion - GDI
Valuation,
Brokerage,
Consulting
Invention,
R&D, Standardiz
ation
Prosecution,
Value-Up,
Litigation
Full coverage of IP-R&D Service
GOOD DAY to
INVENT
BLT
Patent search &
analysis
Yearly patent
management
IP business consulting
IP Consulting
Education
VC invest, M&A

BLT
Qualitative Expansion – GDI - Proud Numbers
Idea Prosecute Value-up Monetize
1950+
$7,710,000IP Transaction completed
(in last 2 years)
110+
Patents of inventorship
Portfolio Value-up &
Claim chart
Qualitative
Expansion

BLT
Qualitative Expansion – GDI – Value Up
Reclaim
a Patent
($0)
Star Patent
($100M)
Reclaiming,
Claim charting,
Reverse engineering
for sophisticated standard IPs
Idea Prosecute Value-up Monetize
Client GDI

BLT
Qualitative Expansion – GDI – TEG(Tech Experts Group)
For about GDI, ask:
• Henney Oh, PhD
o@gdiholdings.com

BLT
4 steps of MOP
MOP
Qualitative
Expansion
Quantitative
Expansion
Introductory
Stage
Effects
• Market dominance
• Patent
competitiveness
• Earnings from
Licensing or
Litigation
Constant investment is challenging
Appealing ‘newcomers’ formidable emerge’
Missions for MOP
• Licensing team is set up
• Analyzing who infringes
constantly
• Scouting or raising
patent specialists
• Researcher’s patent using ability

BLT

BLT
www.BLTe.kr 74
GDI IP alliance
The only FIRM who cares for your SUCCESS
BLT
Jeonghan Eom
+82-70-4100-0102
shawn@BLTe.kr
www.facebook.com/byunlisa

[BLT] Management of Patent - How to reinforce your company's IP capacity

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[BLT] Management of Patent - How to reinforce your company's IP capacity