This document discusses common intellectual property pitfalls that investors should be aware of and provides tips for conducting due diligence on a company's IP. It notes that investors should research IP ownership, technology claims, and ensure the company can maintain its patent portfolio. The summary also highlights the need to understand how a company's IP compares to competitors and whether the IP covers core inventions or smaller improvements.

1. Common Investor Pitfalls
with Intellectual Property
and how to avoid them

2. Your hosts
Heidi Brun
Joint Head of Patent Department
Eitan, Mehulal & Sadot
Zack Miller
Partner, Investor Community
OurCrowd

3. Many types of
Intellectual Property (IP)

4. Many types of IP
• Patents
• Trademarks
• Designs
• Copyrights
• Trade Secrets
Different types of
companies have different
IP needs

5. Many types of IP
Trade Secret vs. Patent

6. Due Diligence

7. Due Diligence
• Ownership
• Technology
• Claims
• Where filed

8. Ownership Issues
• Company ownership vs. inventors
• Employees vs. contractors (particularly for software)
• Inventor’s willingness to sign assignments
• Patent laws in various countries vs. US law

9. Ownership Research
• Online at various patent
offices
• Search via company name,
inventor names
• http://assignments.uspto.gov/
assignments/q?db=pat

10. Ownership Research

11. Ownership Research

12. Technology

13. Technology
• Is it brand-new tech? Or, improvement of a
successful one?
• Does the company have a new take on an old
idea?
• How do the claims compare to the product? Are
they on only a small part of the product? If so, is
this still good?
• What claims/patents do competitors have?

14. Big vs. small inventions

15. Big vs. small inventions
• Startups concentrate on their BIG inventions
• Do they have other good (smaller) ideas hiding
in the patent applications?
• Don’t always claim what can be claimed —
applications may have valuable inventions
described in applications that haven’t been
claimed

16. Large number of
applications/patents
• Is this good? Does it mean that the company is
innovative?
• Yes — the company has many ideas
• No — the company is good at defining its one
invention in many ways (which may be good…)
• Remember: Some startups write patents knowing
investors don’t read them

17. Technology Research I
• Patentability search — Google Patents:
Advanced Search

18. Technology Research I

19. Technology Research II
• Proviso 1 — any patents found, have to be provided to
USPTO, ILPTO
• Proviso 2 — patents found in search may have broad
claims that company’s products may infringe. Need to
deal.
• Need to decide for yourself if:
• current claims will issue
• current claims are useful to the company
• current claims are useful to your plans for the company

20. Patent
Portfolios

21. Patent Portfolios I
• Multiple inventions
• Filings in multiple countries
• US only or around the world?
• US investors have a bias to US filings
• On the other hand — the company may file in
many countries
• without realising the huge maintenance cost

22. Patent Portfolios II
• When money runs tight, a startup won’t keep
up its patent portfolio
• Investors may have to jump in to keep rights
active

23. Patent Portfolios Research
• Search in Espacenet, Dialog, Thomson-
Reuters etc. for patent families
• Check status and any close dates — will the
company be able to keep applications alive

24. Patent Portfolios Research

25. Patent Portfolios Research

26. Patent Portfolios Research

27. Property
• Patents have value which outlives the
company
• Patents have a market

29. Heidi M Brun
Eitan, Mehulal & Sadot
+972-2-633-5021
+972-9-972-6000
heidib@ems-legal.com
www.ems-legal.com
Zack Miller
OurCrowd
+972-2-636-9000
+1-914-617-1026
zack@ourcrowd.com
www.ourcrowd.com
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