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www.iam-magazine.com24 Intellectual Asset Management November/December 2012
Peace makers
IP management in
aerospace and
defence
As states subsist in part by keeping their
weaknesses from being known, so is it the quiet
of families to have their chancery and their
parliament within doors, and to compose and
determine all emergent differences there –
John Donne
While the wireless telecommunication and
mobile computing (WT&MC) industries are
engaged in a global IP war for all to
examine, comment on, analyse and profit
from through publishing and consulting,
the aerospace and defence (A&D)
industries are engaged in a prolonged
family debate in the privacy afforded by
closed doors.
How does this difference come about?
Principally, through the difference in the
nature of the intellectual property at issue.
In WT&MC, the IP currency is patents,
while in A&D, the IP currency is proprietary
information - such as requirements
documents, specifications, designs and
design documentation, bills of materials,
certification artefacts, assembly
instructions, manufacturing processes,
certification processes, test processes,
trade secrets and knowledge/databases of
what does and does not work - and
software. Thus, while many infringements
in the WT&MC markets are public, most
infringements in the A&D markets are
private, observable only by those with
IP and other intellectual assets play
a key role in the aerospace and
defence industry, and are regularly
monetised, but the high-profile
litigation seen in other sectors has
yet to make a mark
By Bill Elkington
access to the proprietary information in
question.
And in the case of A&D, it is not so
much a matter of infringements as it is
agreeing on the rules. The disagreements
occur largely ahead of an endeavour that we
would like to launch upon together, before
we build the boat that we will take to a
common destination. As we sit down before
the computer screen, we need to answer a
number of forward-looking questions:
whose rudder is it? When we are done?
Who will design the keel? Whose model
will show us that two mast-mounted sails
and a jib may be better than a one mast-
mounted sail and two jibs? And who will
have what influence on the final hull design?
Regarding intellectual property, the A&D
industry is perhaps not one big happy
family. Euripides once said: “One loyal
friend is worth ten thousand relatives.” Or
something like that.
In the highly collaborative A&D
industry, there will always be differences in
perspective over IP ownership and licence
rights, because it is through intellectual
property that each of us achieves advantage,
and all are competing for profits - a
privileged position in the value chain. So we
are certainly competing with direct
competitors regularly - but even possibly,
from time to time, with our customers and
suppliers - for our fair share of the
industry’s profits.
This is not so different from the
WT&MC industry. It’s just that in A&D, the
discussions largely concern
private/proprietary/IP matters, while in the
WT&MC industry, we are dealing with
publications and with a dispute resolution
process that is highly public.
In this article, I question three
colleagues - all remarkable IP management
experts and friends, and all working in
IAM is the Official Strategic Media Partner
of LES (USA & Canada). As part of this
wide-ranging cooperation agreement, both
parties work together to provide thought
leadership relating to the strategic creation
of value from intellectual property. With this
in mind, every issue of IAM will feature an
exclusive article written by an LES member
or members that focuses on an IP value
creation issue. The content and authorship
of the article is always agreed in advance
with the IAM editorial team and is subject
to the same editing process as all other
articles published in the magazine. The
work and the opinions of the author(s) are
personal to the author(s) and do not
represent those of LES (USA & Canada).
Intellectual Asset Management November/December 2012 25www.iam-magazine.com
Peace makers
companies that are customers of my
company. I try to understand from them
how the IP management function is
conceived, what the objectives and methods
of IP management are and how IP
management is performed in the A&D
industry. All three are from large, global
companies, with IP responsibilities that are
broad and various.
Each of them characterises the industry
with respect to intellectual property and his
role as IP management leader somewhat
differently. And it is in those differences
that you may have the most interest. This is
who they are: William McInnis, licensing
manager within the IP and licensing
function of the Office of the General
Counsel at Raytheon Company global
headquarters; James Runstadler, president
of Textron Innovations Inc, Textron Inc’s IP
management company; and Wulf Hoeflich,
chief IP officer (CIPO) of EADS.
As you read on, please bear in mind that
what I and they have to say are our own
personal views and do not reflect the views
of our employers or our employers’
customers or clients. I find what they have
to say somewhat different from what I
would say in their places and that is, on the
whole, fascinating.
What does IP management look like in
your company and the A&D industry in
general? What is the focus? What are the
overriding objectives?
William McInnis (WM): In our company,
IP management starts at the business unit
level, with invention review committees
which are close to the technology and the
market. The engineering, contracts and
business development functions, as well as
legal, are all participants in this process.
The administrative functions of patent
prosecution and maintenance are
centralised at company headquarters, in the
office of the general counsel, IP and
licensing (IP&L) function.
The task of the licensing group is to
determine the best strategic use of the
intellectual property, whether that be
enforcement, licensing, sale or
abandonment. This group is responsible for
carrying out these activities, with any
resulting revenue credited to the
business unit which originated the
intellectual property.
This model seems to be fairly typical
throughout the A&D industry, based on my
conversations with colleagues. In some
cases the home location of the licensing
function may not be the legal function, but
rather a business office or engineering; but
the purpose and interactions with other
functions remain the same.
James Runstadler (JR): A&D companies
tend to be R&D-intensive businesses with
long development times and
correspondingly long product lifecycles. My
company spends hundreds of millions of
Those taking part in the roundtable are:
• William McInnis is the licensing manager
within the IP and licensing function of the
office of the general counsel at Raytheon
Company global headquarters. He has
responsibility to provide value from
Raytheon IP assets, including technology
licensing, investigating infringement,
asset sales and international offsets. He
is a former engineering and programme
manager within the A&D industry, with
over 28 years at Raytheon. He holds a BS
from the University of Rochester and an
MBA from University of Bridgeport.
• James Runstadler is president of Textron
Innovations Inc, which is Textron Inc’s IP
management company. His organisation
manages Textron’s technology, patent,
brand and copyright licensing
programmes, and oversees company IP
processes, strategies, policies and
procedures. In his 25-year career with
Textron, he has held positions in
engineering, marketing and product
development at a number of Textron
divisions and the corporate office. He has
an MBA from Boston University, an MS
from Rensselaer Polytechnic Institute and
a BE and AB from Dartmouth College.
• Wulf Hoeflich has been chief IP officer of
EADS since 2006. In addition, since
2004 he has been vice president of
intellectual property at Airbus in
Toulouse. Before joining Airbus, Mr
Hoeflich spent four years as head of the
patent department of General Motors
Europe and AdamOpel AG.
From 1997 to 2000 he was head of the
patent department of Knorr-Bremse AG,
Munich, and from 1990 to 1997
he was a patent professional in the
patent department of MTU Motoren- und
Turbinenunion GmbH, a former
Daimler-Chrysler company, Munich.
The participants
www.iam-magazine.com26 Intellectual Asset Management November/December 2012
Peace makers
dollars each year on R&D to bring industry-
leading innovative products to market.
Effective IP management is crucial to
ensuring that these product and technology
investments are protected, and Textron files
many patents worldwide to secure its
technology rights. In addition, much of the
IP value at A&D companies is in their
know-how, technology data and
specifications. Thus, you will find that trade
secret protection is also a key focus of most
A&D companies.
Textron Innovations, Textron Inc’s IP
management company, oversees IP
strategies, policies and procedures across
the Textron enterprise, and each division
has personnel in both the legal and
technical functions with IP responsibility
for that operation.
Wulf Hoeflich (WH): EADS has a
divisional structure that includes Airbus,
Eurocopter, Astrium, Cassidian and its
corporate research organisation, Innovation
Works. Each division has its own IP
management department. The company’s
chief intellectual property officer (CIPO) is
based in the EADS headquarters function
and chairs the IP council. This council is the
assembly of all divisional IP leaders, which
discusses and makes decisions on joint
activities such as the acquisition of a new IP
management system. The CIPO reports to
the chief technology officer (CTO) and the
general counsel (GC).
The general objective of the IP function
is patent filing targets, which are tracked on
a divisional level. In 2011 EADS filed more
than 1,000 new patents applications. With
regard to the EADS technology licensing
initiative, the objective has to do with
the value of the new licences signed within
a calendar year.
Is IP management tied into the strategic
planning and decision-making processes
of A&D companies? In other words, is
intellectual property considered a
strategic resource in most companies in
the industry?
WM: Intellectual property is one factor in
the decision making and strategic planning
of technology pursuits and growth areas. It
is explicitly reviewed as part of the
management review process for prioritising
new ventures
However, Authorisation and Consent
(A&C), 28 USC 1498, affects the value of
patents and copyrights, and so changes their
impact in the business model and hence
their relative importance in the strategic
planning process. 28 USC 1498 provides in
part: “(a) Whenever an invention described
in and covered by a patent of the United
States is used or manufactured by or for
the United States without license of the
owner thereof or lawful right to use or
manufacture the same, the owner’s
remedy shall be by action against the
United States in the United States Court of
Federal Claims for the recovery of his
reasonable and entire compensation for
such use and manufacture.”
JR: As in most other industries, the key to
success is providing innovative products
and services that meet the needs of the
customer, whether it is a commercial or
government customer. IP rights are crucial
to protect the key aspects of innovations so
that the company can maintain its product
or technology edge. With IP management, it
is essential that the IP protection strategy is
aligned with the technology roadmap,
product strategies and business strategies.
While intellectual property is important for
protecting these product and business
strategies, when formulated properly an IP
strategy can be used to further rather than
simply protect your business strategies. It is
in this scenario that IP management is most
effectively employed as a strategic resource.
WH: IP management is tied into strategic
planning as objectives of IP management
and deliverables, such as filing objectives,
extension policy and licensing contract
values, are defined at CTO level in
coordination with the GC.
Is IP management conceived of as a legal
function or a business function in our
industry, or a bit of both? Could you
comment on the thinking and history
behind the orientation?
WM: In my experience, it is more likely to
reside in the legal function, although there
is great diversity among the A&D
companies that I am familiar with, including
residing in the business or programme areas
or the engineering areas, or set up as a
wholly owned subsidiary. Each model has
benefits and drawbacks, and could be
worthy of its own IAM article, but it seems
that the legal orientation is mostly down to
the fact that the core skill of patent
attorneys are in the legal function. IP law is
complex, requiring expertise in IP
protection (patent prosecution, copyrights,
data rights), transactions (licences, sales
agreements, M&A activity) and enforcement
(litigation). Each of these IP areas often has
William McInnis
Licensing manager, Raytheon Company
“Intellectual property is one factor in the
decision making and strategic planning of
technology pursuits and growth areas.
It is explicitly reviewed as part of the
management review process for prioritising
new ventures”
Intellectual Asset Management November/December 2012 27www.iam-magazine.com
Peace makers
its own specialised practitioners, so it is not
an easy case of embedding a single patent
attorney in another function.
JR: Legal, technical and business resources
all have a part to play in IP management.
The technical or engineering function is
essential for determining the importance of
a given invention to the product and how it
fits in the company’s overall technology
roadmap. The business function is key to
putting an economic value on the
inventions and allocating protection
resources across product lines, and the legal
function is important for executing the
protection plan. My experience has shown
that if any one of the three functions is not
involved, the process will produce less than
optimal decisions.
WH: IP management is hosted in the CTO
function, with a functional reporting line to
the GC. The budget is held within the CTO
organisation. A strong link with the
engineering organisation is considered
critical to harvesting and protecting
inventions effectively. For the enforcement
of intellectual property and defence against
IP claims, the strong link to the GC comes
into play. Technology licensing is
considered as a business function within
the CTO organisation.
Is IP management distributed or
centralised in most companies in A&D?
Could you comment on the reason for it
being one or the other or some
combination of the two? However it is
organised, how is the organisation
working?
WM: Over the long history of Raytheon,
many models have been tried, and of course
each has its own strengths and weaknesses.
Our current model is that innovation is
captured and reviewed close to the point of
origin, as each business unit - and in some
cases each geographic location - has its own
IP champion and invention review
committees. This allows the capture to be
facilitated by local experts and likewise
reviewed by those most knowledgeable in
the field. Once the innovation is captured, it
is processed for protection through a central
location. This method has the benefit of
lowering cost by increasing volume through
a few selected law firm partners, rather than
having each business unit process them at
low volume through a multitude of firms. It
also drives a consistent look and feel to the
company’s portfolio, and bundles technology
from throughout the company for better
consistency and licensing potential, as well
as foreign filing consistency. This model also
helps to drive and maintain improved
quality (eg, claims coverage, enablement,
prior art considered) by having a dedicated
team of internal patent attorneys managing
the prosecution, instead of patent
prosecution being an ancillary job of a
business unit patent attorney. It does
sacrifice a local presence to gather some of
the nuances of the innovation, but this is
more than compensated by the broadening
effects of a larger portfolio prosecuted by a
focused law firm.
JR: Effective IP management in a large
organisation is a balance between
centralised efficiency and distributed
management responsiveness and awareness.
Textron has struck the balance by having
overall IP programme governance and
oversight at the corporate level and direct
management of business IP issues at the
division level. This arrangement has proven
effective in implementing company-wide
processes and tools and enabling
identification and sharing of IP
management best practices across the entire
company, while also providing IP
management responsibility in close
proximity to the needs of the business.
The A&D industry is global. How does
this fact play into IP management? How
does the need to support IP transactions
in many different jurisdictions impact
on IP management professionals in A&D
companies?
WM: Again, this question could almost
spawn its own IAM article, as foreign IP
rights are quite complex. For the A&D
industry, the first issue is the need for
foreign filing, and in what countries. In
some cases it is where your customers are or
where you hope they will be, or where your
competitors are or where future competitors
are. The rules for filing in foreign
jurisdictions require in some cases that your
US case be handled differently so as not to
damage your foreign case, which may have
different rules on publication or prior art.
Another factor is the role that
intellectual property plays in the foreign
country’s legal system, as in some
jurisdictions intellectual property is
currently of little business value and
not worth the expense. However, some
countries consider filing patents a sign of
confidence in their country and will even
award offset credit for IP filings.
Also, foreign filings must be more
James Runstadler
President of Textron Innovations Inc
“Effective IP management in a large
organisation is a balance between
centralised efficiency and distributed
management responsiveness and
awareness”
Wulf Hoeflich
Chief IP officer, EADS
“A CIPO needs a strong role in an A&D
company, with full control of budget,
strategy, operational objectives and staff
qualification, in order to leverage the
maximum benefit of this function”
www.iam-magazine.com28 Intellectual Asset Management November/December 2012
Peace makers
actively managed than US cases, as the
expense of foreign cases – in terms of
both prosecution and maintenance - are
higher than in the United States. As
business needs change, the portfolio should
be dynamically adjusted through
abandonment or sale to minimise expense.
JR: Close coordination with legal resources
is essential to managing intellectual
property outside your home country. It is
impossible for a single individual to
understand and maintain knowledge on IP
practices and laws in the numerous
countries in which most A&D
companies transact business. In addition,
issues such as export control regulations
and International Traffic in Arms
Regulations that apply to many A&D
companies add complexity to
international transactions and present
potential landmines for the
unwary IP manager.
WH: The global set-up of A&D business
requires an IP staff with dedicated IP
qualifications and experience in
international business transactions. It is
also valuable to have staff that can work in
various divisions and countries.
How important is IP management in A&D,
generally? Does intellectual property
come up as a topic or issue frequently or
infrequently? What is the trajectory of the
role of intellectual property in A&D
markets? Is it getting more important with
time or less important, or is its importance
pretty much the same over time?
William McInnes: I think that an increased
emphasis has been placed on IP
management in the A&D industry in general,
corresponding to the increased awareness
of intellectual property in the commercial
world. While Authorisation and Consent
(A&C) makes for a unique business model
for the A&D industry, there still is substantial
value to intellectual property – namely,
licensing others to the technology
developed for defence applications; sale of
intellectual property generated for defence
purposes which helps to defray the costs of
research and IP prosecution; foreign
recognition of IP rights, as A&C does not
apply outside the United States (although
some countries have their own version of
A&C); and defence or cross-licensing of
intellectual property as applicable to
commercial products made by the A&D firm.
James Runstadler: IP issues are present
across a wide variety of business
transactions, whether it is a co-development
project, sourcing a component or selling a
product or service. As A&D companies
become less vertically integrated and
increasingly rely on partnerships with other
technology companies to bring products to
market, the role of intellectual property in
protecting the company’s proprietary data
and know-how will become correspondingly
more important to the business.
Wulf Hoeflich: Technology licensing is
changing the face of IP management
significantly, as it adds the commercial
angle to a traditionally more legal and
technology-based perspective. Selling
patents and technologies requires a
completely different mind set. For example,
risk-averse behaviours are major
obstacles in leveraging IP value.
IP management in aerospace and defence
Communicating the importance of intellectual property to
a multitude of functional organisations doing co-development
projects, supply contracts, distribution agreements and so on
is a never-ending process
Intellectual Asset Management November/December 2012 29www.iam-magazine.com
Peace makers
When A&D companies do IP
transactions, who is the counterparty?
Is it typically a company within the A&D
industry or outside it? In a typical A&D
company, what percentage of IP
transactions happen with companies
within the industry?
WM: In my experience, the counterparty is
mostly outside the A&D industry. This does
not apply to items such as computer
software, however, and licensing transactions
for these items can be either inside or
outside the A&D industry. Also, teaming
agreements - which are common in the A&D
industry - have an aspect of IP licensing.
JR: Almost always, the counterparty is
another company within the industry – a
supplier, customer, programme partner or
business selling related products.
What typically is the subject of IP
transactions in A&D? Is it patents,
copyrights, trademarks, software,
documentation and/or proprietary
information of some kind? Please
characterise a typical IP transaction in
the A&D industry.
WM: The short answer is, all of the above.
Patents are valuable for sale and licensing. If
the licensing is of the technology transfer
type, some proprietary information usually
comes with it. Software is an active area for
sale or licensing, and that often involves
copyrighted source code and user manuals,
a trademarked name for the software and
sometimes patented algorithms used in the
software. In general, the more elements of
intellectual property transferred as part of
the transaction, the greater the value.
JR: Although we have IP transactions
covering all areas, most relate to proprietary
information and data. The technological
complexity and cutting-edge nature of most
A&D products necessitates working closely
with other companies to bring the products
to market. Sharing of product and
technology data, specifications and know-
how is an essential component of these
joint development projects. A typical
transaction might involve providing
proprietary data to a component
development partner or licensing data to a
third party to obtain certification on an
accessory to one of our products. One of the
challenges experienced by many A&D IP
professionals is educating their organisation
on IP issues. Many A&D companies are
large, geographically dispersed
organisations. Communicating the
importance of intellectual property to a
multitude of functional organisations doing
co-development projects, supply contracts,
distribution agreements and so on is a
never-ending process.
A good deal has been written about the
role of the chief intellectual property
officer (CIPO) both in IAM magazine and
elsewhere. What do you think of such a
role? Is it appropriate to a company in the
A&D industry? What should the typical
reporting structure and role be for an A&D
CIPO? What is your rationale?
William McInnes: Our vice president of
intellectual property and licensing, within the
office of the GC, effectively functions in this
role. He approves transactions and sets policy
for the capture and exploitation of intellectual
property. He also collaborates closely with the
vice presidents of engineering, business
development, contracts and corporate
development. This position is one level
removed from reporting to the CEO, and
seems about right given the role of intellectual
property in the operation of the business.
James Runstadler: IP management is most
effective when the various functions
(engineering, programme management, legal)
take ownership of their IP responsibilities.
Instilling this IP responsibility within their job
is essential whether the company has
someone in the CIPO position or not. The
CIPO role may be effective in ensuring that
appropriate resources are brought to bear on
IP issues, and that functional leaders
understand the intellectual property
responsibilities for their organisation; but at
the end of the day, the task still falls to the
functional organisation to do its job.
Wulf Hoeflich: A CIPO needs a strong role in
an A&D company, with full control of budget,
strategy, operational objectives and staff
qualification, in order to leverage the
maximum benefit of this function. If this
control is given, the reporting structure
comes into play next. The CIPO role should
be hosted where it has the best business
impact. CTO /engineering is very common
in Europe, but a good link with the GC could
work as well.
The chief IP officer in aerospace and defence
www.iam-magazine.com30 Intellectual Asset Management November/December 2012
Peace makers
WH: Technology licensing transactions
place a strong focus on the commercial
aspects of structuring a deal. Such
transactions increasingly include elements
of engineering and know-how. Traditional
deal elements such as patents and
trademarks are still essential, but
commercial aspects are predominant as
finally the business model is the focus.
Please characterise the role of IP
management in the development and
deployment of standards in A&D.
WM: Generally, we don’t participate in
standards-setting bodies.
JR: Some of the trickiest IP transactions
involve consortia that seek to establish
industry best practices or standards. In
some cases these groups include companies
that compete on a day-to-day basis.
Participants - frequently technical
personnel - must tread carefully in meeting
the objectives of the consortium without
forfeiting the company’s IP advantages.
WH: Still very weak. We have established
just a few standards, such as AFDX, with a
strong role from IP management. That said,
standards do not play the same role as in
consumer communication technologies.
We are all aware of the patent wars that
are being conducted in the high-
technology and telecommunications
industries. Will the A&D industry likely
see similar conflicts at some point in the
future? What is your rationale?
WM: A&C, 28 USC 1498, will limit conflict
within the A&D industry, but the A&D
firms may become more aggressive in
demanding licences for their technology
being used outside the A&D industry. As
margins get squeezed, companies will be
looking for new sources of revenue.
JR: Although we have had IP disputes with
other companies in the A&D industry I
doubt we will ever see battles anywhere near
the extent being fought in the
telecommunications field. Longer product
development timeframes allow organisations
to identify and work around patent obstacles
and still get a product to market. In addition,
as mentioned above, a lot of the IP value in
A&D companies resides in the proprietary
data and know-how of their employees. It is
unlikely that you would see a trade secret
dispute expand to the scope of the telecoms
battles recently being fought.
WH: In the past, similar disputes have been
handled more quietly.
What will IP management look like in
the A&D industry 10 years from now?
What will be the same and what will be
different? Does our industry offer a
promising future for IP management
professionals? What will be their role 10
years from now?
WM: Assuming that the underlying
legal framework doesn’t change, I suspect
that the landscape will look pretty much
the same, except that A&D firms may
become more aggressive in licensing
their technology outside the A&D
industry. As intellectual property is
recognised by senior management as a
source of revenue, more emphasis
and resources will be allocated to
intellectual property.
JR: As I mentioned previously, most A&D
companies increasingly partner with others
in the industry on programmes and
technology development in applying state-
of-the-art technologies to their
products. This co-development trend is
likely to continue going forward and thus
provide ample opportunities for the IP
management professional to continue to
find a challenging and rewarding career in
the A&D industry.
WH: Patent and trademark assets will be
seen more as a business asset than as
administrative subjects.
A different industry
Why is A&D so different from WT&MC?
Perhaps we are more collaborative. Perhaps
there are fewer standards and more
independent invention required. Perhaps we
retain more of the culture of a previous time
- a time in which colleagues were
essentially collegial.
But these are morally loaded terms, and
I don’t really mean them that way.
Besides, my experience is that some
in the A&D industry are not shy
about making an IP grab. Some seem
to be willing to take advantage, when they
have advantage.
What has changed in the one industry
and been preserved in the other may be the
result of outside pressure. Perhaps in the one
industry, dynamics have pressed business
leaders to the point that they have lashed out
to protect the value of their companies’
innovation. Perhaps in the other, dynamics
have not pressed business leaders as much.
Action plan
Corporate and IP management leaders in
the aerospace and defence industry should
consider the following when structuring IP
transactions with customers, co-
development partners (sometimes
competitors) and suppliers, and when
structuring the IP function, to ensure that
the industry remains collegial and
collaborative:
• Fair treatment of others in IP matters,
no matter one’s market power.
• In collaborative situations, definitions of
ownership that are clear and
unambiguous.
• Definitions of licence rights that are
reasonable and responsible.
• Configuration of an IP management
function that uses and advances best
practices knowledge and competency
to guide the company’s IP transactions.
• Definition of an IP management
function that is driven by strategic
business people.
• Development of IP transaction metrics
that encourage even-handed treatment
of business partners rather than
exploitation of business partners to
gain short-term financial benefit.
A
Intellectual Asset Management November/December 2012 31www.iam-magazine.com
Peace makers
But as I say, the jury’s out. The A&D
ship, a family enterprise, is well on its way.
None of us can say with certainty how well
the voyage will go from here, but a number
of us can say - because we study global IP
transactions, as they surface - that our IP
transaction practice should be best practice,
so that it will be regarded as reasonable and
acceptable by everyone.
Bill Elkington is senior director, intellectual
property management, Rockwell Collins, Inc,
and Licensing Executives Society (USA and
Canada) trustee for the IP100 Executive
Forum and Corporate Communications
77 King Street West
Suite 2010
Toronto-Dominion Centre
Toronto, Ontario M5K 1K2
Canada
tel: 1.416.703.1100
GILBERT’S LLP LAWYERS
Experience our innovative thinking
gilbertslaw.ca
GILBERT’S NEW YORK CORP.
12 West 21st Street
8th Floor
New York, NY
10010
U.S.A.
tel: 1.212.252.2119
WYERST’S LLP LAGILBER
tel: 1.416.703.1100
anadaC
, Ontario M5KontoorT
eonto-Dominion CorT
Suite 2010
esteet W77 King Str
S
1K2
entr
tel: 1
U.S.A
1001
wNe
8th F
12 W
GILBE
1.212.252.2119
A.
10
ork, NYY
Floor
eetest 21st StrW
ORP.ORK CT’S NEW YER
Established in 1965, the Licensing
Executives Society (USA and Canada), Inc
(LES) is a professional society comprised of
over 4,500 members engaged in the
transfer, use, development and marketing of
technology and intellectual property. The
LES membership includes a wide range of
professionals, including business
executives, lawyers, licensing consultants,
engineers, academicians, scientists and
government officials. Many large
corporations, professional firms and
universities comprise the LES membership.
LES is a member society of the Licensing
Executives Society International, Inc, with a
worldwide membership of more than
10,000 members in 32 national societies,
representing over 90 countries. For more
information on LES, see
www.lesusacanada.org.
Then also, in the United States, there is
A&C, the federal government policy to
which Bill McInnis alludes. This policy may
reduce the potential value of patents and
copyrights in the defence industry by
requiring the plaintiff to file the complaint
against the US government, rather than
against the possibly infringing company.
This can be quite intimidating for a variety
of reasons, not least of which is that the US
government is often a significant customer
of many in the defence industry.
But finally, it’s hard to say - even for
someone sitting on the inside, with
colleagues and friends in a variety of
industries to compare notes with.
Where will we go from here? I don’t know. I
would like to think that we will be sailing
along as we are now, all one contentious-
collaborative-cooperative-congenial-
difficult family, dealing with our differences
in a reasonable and gentle way, and generally
not looking to the courts for resolution. I
would like to think that those with
advantage would treat one another fairly,
according to IP management best practices.

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IP management in aerospace & defense IPM

  • 1. www.iam-magazine.com24 Intellectual Asset Management November/December 2012 Peace makers IP management in aerospace and defence As states subsist in part by keeping their weaknesses from being known, so is it the quiet of families to have their chancery and their parliament within doors, and to compose and determine all emergent differences there – John Donne While the wireless telecommunication and mobile computing (WT&MC) industries are engaged in a global IP war for all to examine, comment on, analyse and profit from through publishing and consulting, the aerospace and defence (A&D) industries are engaged in a prolonged family debate in the privacy afforded by closed doors. How does this difference come about? Principally, through the difference in the nature of the intellectual property at issue. In WT&MC, the IP currency is patents, while in A&D, the IP currency is proprietary information - such as requirements documents, specifications, designs and design documentation, bills of materials, certification artefacts, assembly instructions, manufacturing processes, certification processes, test processes, trade secrets and knowledge/databases of what does and does not work - and software. Thus, while many infringements in the WT&MC markets are public, most infringements in the A&D markets are private, observable only by those with IP and other intellectual assets play a key role in the aerospace and defence industry, and are regularly monetised, but the high-profile litigation seen in other sectors has yet to make a mark By Bill Elkington access to the proprietary information in question. And in the case of A&D, it is not so much a matter of infringements as it is agreeing on the rules. The disagreements occur largely ahead of an endeavour that we would like to launch upon together, before we build the boat that we will take to a common destination. As we sit down before the computer screen, we need to answer a number of forward-looking questions: whose rudder is it? When we are done? Who will design the keel? Whose model will show us that two mast-mounted sails and a jib may be better than a one mast- mounted sail and two jibs? And who will have what influence on the final hull design? Regarding intellectual property, the A&D industry is perhaps not one big happy family. Euripides once said: “One loyal friend is worth ten thousand relatives.” Or something like that. In the highly collaborative A&D industry, there will always be differences in perspective over IP ownership and licence rights, because it is through intellectual property that each of us achieves advantage, and all are competing for profits - a privileged position in the value chain. So we are certainly competing with direct competitors regularly - but even possibly, from time to time, with our customers and suppliers - for our fair share of the industry’s profits. This is not so different from the WT&MC industry. It’s just that in A&D, the discussions largely concern private/proprietary/IP matters, while in the WT&MC industry, we are dealing with publications and with a dispute resolution process that is highly public. In this article, I question three colleagues - all remarkable IP management experts and friends, and all working in IAM is the Official Strategic Media Partner of LES (USA & Canada). As part of this wide-ranging cooperation agreement, both parties work together to provide thought leadership relating to the strategic creation of value from intellectual property. With this in mind, every issue of IAM will feature an exclusive article written by an LES member or members that focuses on an IP value creation issue. The content and authorship of the article is always agreed in advance with the IAM editorial team and is subject to the same editing process as all other articles published in the magazine. The work and the opinions of the author(s) are personal to the author(s) and do not represent those of LES (USA & Canada).
  • 2. Intellectual Asset Management November/December 2012 25www.iam-magazine.com Peace makers companies that are customers of my company. I try to understand from them how the IP management function is conceived, what the objectives and methods of IP management are and how IP management is performed in the A&D industry. All three are from large, global companies, with IP responsibilities that are broad and various. Each of them characterises the industry with respect to intellectual property and his role as IP management leader somewhat differently. And it is in those differences that you may have the most interest. This is who they are: William McInnis, licensing manager within the IP and licensing function of the Office of the General Counsel at Raytheon Company global headquarters; James Runstadler, president of Textron Innovations Inc, Textron Inc’s IP management company; and Wulf Hoeflich, chief IP officer (CIPO) of EADS. As you read on, please bear in mind that what I and they have to say are our own personal views and do not reflect the views of our employers or our employers’ customers or clients. I find what they have to say somewhat different from what I would say in their places and that is, on the whole, fascinating. What does IP management look like in your company and the A&D industry in general? What is the focus? What are the overriding objectives? William McInnis (WM): In our company, IP management starts at the business unit level, with invention review committees which are close to the technology and the market. The engineering, contracts and business development functions, as well as legal, are all participants in this process. The administrative functions of patent prosecution and maintenance are centralised at company headquarters, in the office of the general counsel, IP and licensing (IP&L) function. The task of the licensing group is to determine the best strategic use of the intellectual property, whether that be enforcement, licensing, sale or abandonment. This group is responsible for carrying out these activities, with any resulting revenue credited to the business unit which originated the intellectual property. This model seems to be fairly typical throughout the A&D industry, based on my conversations with colleagues. In some cases the home location of the licensing function may not be the legal function, but rather a business office or engineering; but the purpose and interactions with other functions remain the same. James Runstadler (JR): A&D companies tend to be R&D-intensive businesses with long development times and correspondingly long product lifecycles. My company spends hundreds of millions of Those taking part in the roundtable are: • William McInnis is the licensing manager within the IP and licensing function of the office of the general counsel at Raytheon Company global headquarters. He has responsibility to provide value from Raytheon IP assets, including technology licensing, investigating infringement, asset sales and international offsets. He is a former engineering and programme manager within the A&D industry, with over 28 years at Raytheon. He holds a BS from the University of Rochester and an MBA from University of Bridgeport. • James Runstadler is president of Textron Innovations Inc, which is Textron Inc’s IP management company. His organisation manages Textron’s technology, patent, brand and copyright licensing programmes, and oversees company IP processes, strategies, policies and procedures. In his 25-year career with Textron, he has held positions in engineering, marketing and product development at a number of Textron divisions and the corporate office. He has an MBA from Boston University, an MS from Rensselaer Polytechnic Institute and a BE and AB from Dartmouth College. • Wulf Hoeflich has been chief IP officer of EADS since 2006. In addition, since 2004 he has been vice president of intellectual property at Airbus in Toulouse. Before joining Airbus, Mr Hoeflich spent four years as head of the patent department of General Motors Europe and AdamOpel AG. From 1997 to 2000 he was head of the patent department of Knorr-Bremse AG, Munich, and from 1990 to 1997 he was a patent professional in the patent department of MTU Motoren- und Turbinenunion GmbH, a former Daimler-Chrysler company, Munich. The participants
  • 3. www.iam-magazine.com26 Intellectual Asset Management November/December 2012 Peace makers dollars each year on R&D to bring industry- leading innovative products to market. Effective IP management is crucial to ensuring that these product and technology investments are protected, and Textron files many patents worldwide to secure its technology rights. In addition, much of the IP value at A&D companies is in their know-how, technology data and specifications. Thus, you will find that trade secret protection is also a key focus of most A&D companies. Textron Innovations, Textron Inc’s IP management company, oversees IP strategies, policies and procedures across the Textron enterprise, and each division has personnel in both the legal and technical functions with IP responsibility for that operation. Wulf Hoeflich (WH): EADS has a divisional structure that includes Airbus, Eurocopter, Astrium, Cassidian and its corporate research organisation, Innovation Works. Each division has its own IP management department. The company’s chief intellectual property officer (CIPO) is based in the EADS headquarters function and chairs the IP council. This council is the assembly of all divisional IP leaders, which discusses and makes decisions on joint activities such as the acquisition of a new IP management system. The CIPO reports to the chief technology officer (CTO) and the general counsel (GC). The general objective of the IP function is patent filing targets, which are tracked on a divisional level. In 2011 EADS filed more than 1,000 new patents applications. With regard to the EADS technology licensing initiative, the objective has to do with the value of the new licences signed within a calendar year. Is IP management tied into the strategic planning and decision-making processes of A&D companies? In other words, is intellectual property considered a strategic resource in most companies in the industry? WM: Intellectual property is one factor in the decision making and strategic planning of technology pursuits and growth areas. It is explicitly reviewed as part of the management review process for prioritising new ventures However, Authorisation and Consent (A&C), 28 USC 1498, affects the value of patents and copyrights, and so changes their impact in the business model and hence their relative importance in the strategic planning process. 28 USC 1498 provides in part: “(a) Whenever an invention described in and covered by a patent of the United States is used or manufactured by or for the United States without license of the owner thereof or lawful right to use or manufacture the same, the owner’s remedy shall be by action against the United States in the United States Court of Federal Claims for the recovery of his reasonable and entire compensation for such use and manufacture.” JR: As in most other industries, the key to success is providing innovative products and services that meet the needs of the customer, whether it is a commercial or government customer. IP rights are crucial to protect the key aspects of innovations so that the company can maintain its product or technology edge. With IP management, it is essential that the IP protection strategy is aligned with the technology roadmap, product strategies and business strategies. While intellectual property is important for protecting these product and business strategies, when formulated properly an IP strategy can be used to further rather than simply protect your business strategies. It is in this scenario that IP management is most effectively employed as a strategic resource. WH: IP management is tied into strategic planning as objectives of IP management and deliverables, such as filing objectives, extension policy and licensing contract values, are defined at CTO level in coordination with the GC. Is IP management conceived of as a legal function or a business function in our industry, or a bit of both? Could you comment on the thinking and history behind the orientation? WM: In my experience, it is more likely to reside in the legal function, although there is great diversity among the A&D companies that I am familiar with, including residing in the business or programme areas or the engineering areas, or set up as a wholly owned subsidiary. Each model has benefits and drawbacks, and could be worthy of its own IAM article, but it seems that the legal orientation is mostly down to the fact that the core skill of patent attorneys are in the legal function. IP law is complex, requiring expertise in IP protection (patent prosecution, copyrights, data rights), transactions (licences, sales agreements, M&A activity) and enforcement (litigation). Each of these IP areas often has William McInnis Licensing manager, Raytheon Company “Intellectual property is one factor in the decision making and strategic planning of technology pursuits and growth areas. It is explicitly reviewed as part of the management review process for prioritising new ventures”
  • 4. Intellectual Asset Management November/December 2012 27www.iam-magazine.com Peace makers its own specialised practitioners, so it is not an easy case of embedding a single patent attorney in another function. JR: Legal, technical and business resources all have a part to play in IP management. The technical or engineering function is essential for determining the importance of a given invention to the product and how it fits in the company’s overall technology roadmap. The business function is key to putting an economic value on the inventions and allocating protection resources across product lines, and the legal function is important for executing the protection plan. My experience has shown that if any one of the three functions is not involved, the process will produce less than optimal decisions. WH: IP management is hosted in the CTO function, with a functional reporting line to the GC. The budget is held within the CTO organisation. A strong link with the engineering organisation is considered critical to harvesting and protecting inventions effectively. For the enforcement of intellectual property and defence against IP claims, the strong link to the GC comes into play. Technology licensing is considered as a business function within the CTO organisation. Is IP management distributed or centralised in most companies in A&D? Could you comment on the reason for it being one or the other or some combination of the two? However it is organised, how is the organisation working? WM: Over the long history of Raytheon, many models have been tried, and of course each has its own strengths and weaknesses. Our current model is that innovation is captured and reviewed close to the point of origin, as each business unit - and in some cases each geographic location - has its own IP champion and invention review committees. This allows the capture to be facilitated by local experts and likewise reviewed by those most knowledgeable in the field. Once the innovation is captured, it is processed for protection through a central location. This method has the benefit of lowering cost by increasing volume through a few selected law firm partners, rather than having each business unit process them at low volume through a multitude of firms. It also drives a consistent look and feel to the company’s portfolio, and bundles technology from throughout the company for better consistency and licensing potential, as well as foreign filing consistency. This model also helps to drive and maintain improved quality (eg, claims coverage, enablement, prior art considered) by having a dedicated team of internal patent attorneys managing the prosecution, instead of patent prosecution being an ancillary job of a business unit patent attorney. It does sacrifice a local presence to gather some of the nuances of the innovation, but this is more than compensated by the broadening effects of a larger portfolio prosecuted by a focused law firm. JR: Effective IP management in a large organisation is a balance between centralised efficiency and distributed management responsiveness and awareness. Textron has struck the balance by having overall IP programme governance and oversight at the corporate level and direct management of business IP issues at the division level. This arrangement has proven effective in implementing company-wide processes and tools and enabling identification and sharing of IP management best practices across the entire company, while also providing IP management responsibility in close proximity to the needs of the business. The A&D industry is global. How does this fact play into IP management? How does the need to support IP transactions in many different jurisdictions impact on IP management professionals in A&D companies? WM: Again, this question could almost spawn its own IAM article, as foreign IP rights are quite complex. For the A&D industry, the first issue is the need for foreign filing, and in what countries. In some cases it is where your customers are or where you hope they will be, or where your competitors are or where future competitors are. The rules for filing in foreign jurisdictions require in some cases that your US case be handled differently so as not to damage your foreign case, which may have different rules on publication or prior art. Another factor is the role that intellectual property plays in the foreign country’s legal system, as in some jurisdictions intellectual property is currently of little business value and not worth the expense. However, some countries consider filing patents a sign of confidence in their country and will even award offset credit for IP filings. Also, foreign filings must be more James Runstadler President of Textron Innovations Inc “Effective IP management in a large organisation is a balance between centralised efficiency and distributed management responsiveness and awareness” Wulf Hoeflich Chief IP officer, EADS “A CIPO needs a strong role in an A&D company, with full control of budget, strategy, operational objectives and staff qualification, in order to leverage the maximum benefit of this function”
  • 5. www.iam-magazine.com28 Intellectual Asset Management November/December 2012 Peace makers actively managed than US cases, as the expense of foreign cases – in terms of both prosecution and maintenance - are higher than in the United States. As business needs change, the portfolio should be dynamically adjusted through abandonment or sale to minimise expense. JR: Close coordination with legal resources is essential to managing intellectual property outside your home country. It is impossible for a single individual to understand and maintain knowledge on IP practices and laws in the numerous countries in which most A&D companies transact business. In addition, issues such as export control regulations and International Traffic in Arms Regulations that apply to many A&D companies add complexity to international transactions and present potential landmines for the unwary IP manager. WH: The global set-up of A&D business requires an IP staff with dedicated IP qualifications and experience in international business transactions. It is also valuable to have staff that can work in various divisions and countries. How important is IP management in A&D, generally? Does intellectual property come up as a topic or issue frequently or infrequently? What is the trajectory of the role of intellectual property in A&D markets? Is it getting more important with time or less important, or is its importance pretty much the same over time? William McInnes: I think that an increased emphasis has been placed on IP management in the A&D industry in general, corresponding to the increased awareness of intellectual property in the commercial world. While Authorisation and Consent (A&C) makes for a unique business model for the A&D industry, there still is substantial value to intellectual property – namely, licensing others to the technology developed for defence applications; sale of intellectual property generated for defence purposes which helps to defray the costs of research and IP prosecution; foreign recognition of IP rights, as A&C does not apply outside the United States (although some countries have their own version of A&C); and defence or cross-licensing of intellectual property as applicable to commercial products made by the A&D firm. James Runstadler: IP issues are present across a wide variety of business transactions, whether it is a co-development project, sourcing a component or selling a product or service. As A&D companies become less vertically integrated and increasingly rely on partnerships with other technology companies to bring products to market, the role of intellectual property in protecting the company’s proprietary data and know-how will become correspondingly more important to the business. Wulf Hoeflich: Technology licensing is changing the face of IP management significantly, as it adds the commercial angle to a traditionally more legal and technology-based perspective. Selling patents and technologies requires a completely different mind set. For example, risk-averse behaviours are major obstacles in leveraging IP value. IP management in aerospace and defence Communicating the importance of intellectual property to a multitude of functional organisations doing co-development projects, supply contracts, distribution agreements and so on is a never-ending process
  • 6. Intellectual Asset Management November/December 2012 29www.iam-magazine.com Peace makers When A&D companies do IP transactions, who is the counterparty? Is it typically a company within the A&D industry or outside it? In a typical A&D company, what percentage of IP transactions happen with companies within the industry? WM: In my experience, the counterparty is mostly outside the A&D industry. This does not apply to items such as computer software, however, and licensing transactions for these items can be either inside or outside the A&D industry. Also, teaming agreements - which are common in the A&D industry - have an aspect of IP licensing. JR: Almost always, the counterparty is another company within the industry – a supplier, customer, programme partner or business selling related products. What typically is the subject of IP transactions in A&D? Is it patents, copyrights, trademarks, software, documentation and/or proprietary information of some kind? Please characterise a typical IP transaction in the A&D industry. WM: The short answer is, all of the above. Patents are valuable for sale and licensing. If the licensing is of the technology transfer type, some proprietary information usually comes with it. Software is an active area for sale or licensing, and that often involves copyrighted source code and user manuals, a trademarked name for the software and sometimes patented algorithms used in the software. In general, the more elements of intellectual property transferred as part of the transaction, the greater the value. JR: Although we have IP transactions covering all areas, most relate to proprietary information and data. The technological complexity and cutting-edge nature of most A&D products necessitates working closely with other companies to bring the products to market. Sharing of product and technology data, specifications and know- how is an essential component of these joint development projects. A typical transaction might involve providing proprietary data to a component development partner or licensing data to a third party to obtain certification on an accessory to one of our products. One of the challenges experienced by many A&D IP professionals is educating their organisation on IP issues. Many A&D companies are large, geographically dispersed organisations. Communicating the importance of intellectual property to a multitude of functional organisations doing co-development projects, supply contracts, distribution agreements and so on is a never-ending process. A good deal has been written about the role of the chief intellectual property officer (CIPO) both in IAM magazine and elsewhere. What do you think of such a role? Is it appropriate to a company in the A&D industry? What should the typical reporting structure and role be for an A&D CIPO? What is your rationale? William McInnes: Our vice president of intellectual property and licensing, within the office of the GC, effectively functions in this role. He approves transactions and sets policy for the capture and exploitation of intellectual property. He also collaborates closely with the vice presidents of engineering, business development, contracts and corporate development. This position is one level removed from reporting to the CEO, and seems about right given the role of intellectual property in the operation of the business. James Runstadler: IP management is most effective when the various functions (engineering, programme management, legal) take ownership of their IP responsibilities. Instilling this IP responsibility within their job is essential whether the company has someone in the CIPO position or not. The CIPO role may be effective in ensuring that appropriate resources are brought to bear on IP issues, and that functional leaders understand the intellectual property responsibilities for their organisation; but at the end of the day, the task still falls to the functional organisation to do its job. Wulf Hoeflich: A CIPO needs a strong role in an A&D company, with full control of budget, strategy, operational objectives and staff qualification, in order to leverage the maximum benefit of this function. If this control is given, the reporting structure comes into play next. The CIPO role should be hosted where it has the best business impact. CTO /engineering is very common in Europe, but a good link with the GC could work as well. The chief IP officer in aerospace and defence
  • 7. www.iam-magazine.com30 Intellectual Asset Management November/December 2012 Peace makers WH: Technology licensing transactions place a strong focus on the commercial aspects of structuring a deal. Such transactions increasingly include elements of engineering and know-how. Traditional deal elements such as patents and trademarks are still essential, but commercial aspects are predominant as finally the business model is the focus. Please characterise the role of IP management in the development and deployment of standards in A&D. WM: Generally, we don’t participate in standards-setting bodies. JR: Some of the trickiest IP transactions involve consortia that seek to establish industry best practices or standards. In some cases these groups include companies that compete on a day-to-day basis. Participants - frequently technical personnel - must tread carefully in meeting the objectives of the consortium without forfeiting the company’s IP advantages. WH: Still very weak. We have established just a few standards, such as AFDX, with a strong role from IP management. That said, standards do not play the same role as in consumer communication technologies. We are all aware of the patent wars that are being conducted in the high- technology and telecommunications industries. Will the A&D industry likely see similar conflicts at some point in the future? What is your rationale? WM: A&C, 28 USC 1498, will limit conflict within the A&D industry, but the A&D firms may become more aggressive in demanding licences for their technology being used outside the A&D industry. As margins get squeezed, companies will be looking for new sources of revenue. JR: Although we have had IP disputes with other companies in the A&D industry I doubt we will ever see battles anywhere near the extent being fought in the telecommunications field. Longer product development timeframes allow organisations to identify and work around patent obstacles and still get a product to market. In addition, as mentioned above, a lot of the IP value in A&D companies resides in the proprietary data and know-how of their employees. It is unlikely that you would see a trade secret dispute expand to the scope of the telecoms battles recently being fought. WH: In the past, similar disputes have been handled more quietly. What will IP management look like in the A&D industry 10 years from now? What will be the same and what will be different? Does our industry offer a promising future for IP management professionals? What will be their role 10 years from now? WM: Assuming that the underlying legal framework doesn’t change, I suspect that the landscape will look pretty much the same, except that A&D firms may become more aggressive in licensing their technology outside the A&D industry. As intellectual property is recognised by senior management as a source of revenue, more emphasis and resources will be allocated to intellectual property. JR: As I mentioned previously, most A&D companies increasingly partner with others in the industry on programmes and technology development in applying state- of-the-art technologies to their products. This co-development trend is likely to continue going forward and thus provide ample opportunities for the IP management professional to continue to find a challenging and rewarding career in the A&D industry. WH: Patent and trademark assets will be seen more as a business asset than as administrative subjects. A different industry Why is A&D so different from WT&MC? Perhaps we are more collaborative. Perhaps there are fewer standards and more independent invention required. Perhaps we retain more of the culture of a previous time - a time in which colleagues were essentially collegial. But these are morally loaded terms, and I don’t really mean them that way. Besides, my experience is that some in the A&D industry are not shy about making an IP grab. Some seem to be willing to take advantage, when they have advantage. What has changed in the one industry and been preserved in the other may be the result of outside pressure. Perhaps in the one industry, dynamics have pressed business leaders to the point that they have lashed out to protect the value of their companies’ innovation. Perhaps in the other, dynamics have not pressed business leaders as much. Action plan Corporate and IP management leaders in the aerospace and defence industry should consider the following when structuring IP transactions with customers, co- development partners (sometimes competitors) and suppliers, and when structuring the IP function, to ensure that the industry remains collegial and collaborative: • Fair treatment of others in IP matters, no matter one’s market power. • In collaborative situations, definitions of ownership that are clear and unambiguous. • Definitions of licence rights that are reasonable and responsible. • Configuration of an IP management function that uses and advances best practices knowledge and competency to guide the company’s IP transactions. • Definition of an IP management function that is driven by strategic business people. • Development of IP transaction metrics that encourage even-handed treatment of business partners rather than exploitation of business partners to gain short-term financial benefit. A
  • 8. Intellectual Asset Management November/December 2012 31www.iam-magazine.com Peace makers But as I say, the jury’s out. The A&D ship, a family enterprise, is well on its way. None of us can say with certainty how well the voyage will go from here, but a number of us can say - because we study global IP transactions, as they surface - that our IP transaction practice should be best practice, so that it will be regarded as reasonable and acceptable by everyone. Bill Elkington is senior director, intellectual property management, Rockwell Collins, Inc, and Licensing Executives Society (USA and Canada) trustee for the IP100 Executive Forum and Corporate Communications 77 King Street West Suite 2010 Toronto-Dominion Centre Toronto, Ontario M5K 1K2 Canada tel: 1.416.703.1100 GILBERT’S LLP LAWYERS Experience our innovative thinking gilbertslaw.ca GILBERT’S NEW YORK CORP. 12 West 21st Street 8th Floor New York, NY 10010 U.S.A. tel: 1.212.252.2119 WYERST’S LLP LAGILBER tel: 1.416.703.1100 anadaC , Ontario M5KontoorT eonto-Dominion CorT Suite 2010 esteet W77 King Str S 1K2 entr tel: 1 U.S.A 1001 wNe 8th F 12 W GILBE 1.212.252.2119 A. 10 ork, NYY Floor eetest 21st StrW ORP.ORK CT’S NEW YER Established in 1965, the Licensing Executives Society (USA and Canada), Inc (LES) is a professional society comprised of over 4,500 members engaged in the transfer, use, development and marketing of technology and intellectual property. The LES membership includes a wide range of professionals, including business executives, lawyers, licensing consultants, engineers, academicians, scientists and government officials. Many large corporations, professional firms and universities comprise the LES membership. LES is a member society of the Licensing Executives Society International, Inc, with a worldwide membership of more than 10,000 members in 32 national societies, representing over 90 countries. For more information on LES, see www.lesusacanada.org. Then also, in the United States, there is A&C, the federal government policy to which Bill McInnis alludes. This policy may reduce the potential value of patents and copyrights in the defence industry by requiring the plaintiff to file the complaint against the US government, rather than against the possibly infringing company. This can be quite intimidating for a variety of reasons, not least of which is that the US government is often a significant customer of many in the defence industry. But finally, it’s hard to say - even for someone sitting on the inside, with colleagues and friends in a variety of industries to compare notes with. Where will we go from here? I don’t know. I would like to think that we will be sailing along as we are now, all one contentious- collaborative-cooperative-congenial- difficult family, dealing with our differences in a reasonable and gentle way, and generally not looking to the courts for resolution. I would like to think that those with advantage would treat one another fairly, according to IP management best practices.