PANEL II HOW TO PROTECT INTELLECTUAL PROPERTY 11:35 A.M. – 12:45 P.M.
Panel Moderator: Denise G. Darmanian - Gallo & Darmanian, Esq., New York, New York
Panel Members:
Lana Akopyan - Mauriel Kapouytian Woods LLP, New York, New York Tiran Parsamyan - Moscow, Russia Mark G. Kachigian - Head, Johnson, Kachigian & Wilkinson, PC, Tulsa, Oklahoma Raffi Zerounian - Hanson Bridgett LLP, Los Angeles, California
11:35 – 11:40 Denise G. Darmanian
o Panel Introductions
11:40 – 11:55 Mark G. Kachigian
o What is Intellectual Property o Copyrights Copyrightable Subject Matter Copyright Laws . United States . Armenia Copyright Registration . Scope of Protection . Fair Use . Existence of Rights . Period of Copyright Protection Copyright Ownership . Exceptions Copyright Notice Copyright Infringement International Protection . Berne Convention 11:55 – 12:10 Raffi Zerounian
o Trademarks Trademark Overview . Common Law . Federal Trademark Registration . Examples of Trademarks Trademark Infringement . Likelihood of Confusion using the Sleekcraft Factors Trademark Clearance and Prosecution
12:10 – 12:25 Lana Akopyan
o Patents What is Patentable . Exceptions What is in a Patent? . Drawings . Description . Claims Patent Dilemma: Words versus Inventions U.S. and Global Patent Protection . International Patent System . Filing in U.S. first instead of Europe . Relevant International Deadlines When to File? Patent Protection: What you get? Patent Prosecution Overview Is Software Technology Patentable? Reasons to get Patents Reasons not to get Patents Why should Armenian Companies get U.S. Patents Technology Licensing Cross Border Revenue: Global Trend U.S. Patent Revenue Market . Defensive Strength for Entering U.S. Market . Company has no U.S. Patents . Company has U.S. Patents Portfolio Approach to Patents Patent Program Pre-Filing Patent Application Process
12:25 – 12:40 Tiran Parsamyan
o Intellectual Property Protection in International Investment Agreements and Russian and Domestic Legislation
12:40 – 12:45 o Audience Questions
DENISE G. DARMANIAN, ESQ.
CURRICULUM VITAE
Experience 1989 - Present Gallo & Darmanian, Esqs., Partner New York, New Jersey, Switzerland
Partner in charge of client development in the U.S. and Europe, servicing corporate, commercial, regulatory and intellectual property needs of clients on a domestic and international level.
1983 – 1989 Federated Corporate Services, Inc. Vice President and General Counsel New York, New Jersey, Switzerland
Providing legal and executive management services to U.S. affiliates of foreign entities and providing in-house legal services to diversified holding company FCS Laboratories, Inc. Group (publicly traded), with operating subsidiaries in the fields of health care and electronics, as General Counsel and Corporate Secretary of public parent; Vice President and General Counsel of operating subsidiaries in U.S., Counsel and Responsible Manager for operating subsidiaries in St. Lubin des Joncherets, France.
Education Queens College, New York BA cum laude, Biology
St. John's University School of Law, New York Juris Doctor
Honors: Law School Moot Court Honor Society School wide competition in brief writing and appellate advocacy. One of four students selected to represent Law School in international advocacy competition.
Student Law Clerk, U.S. Magistrate Judge David F. Jordan, United States District Court Eastern District of New York
Admissions New York State, Second Judicial Department United States Supreme Court
Languages English, French and Armenian
Other Co-chair, Armenian Bar Association NY/NJ/CT Chapter; Member, Armenian Bar Association, past member Board of Governors, co-chair of Nominations Committee. Lana Akopyan Attorney
212-529-3356 [email protected]
PRACTICE AREAS
Patent Prosecution Patent Reexamination and Inter-Partes Review (IPR) Patent Due Diligence Patent Analysis and Opinions
LANA AKOPYAN is a patent attorney registered to practice before the United States Patent and Trademark Office. Having spent over 4 years as an engineer in the software industry, Lana brings a wide variety of technical knowledge and experience to her patent work. Lana’s experience in preparing and prosecuting patent applications spans a wide variety of technologies including computer hardware and software, telecommunications, electronics, medical devices and wireless communications.
Prior to joining Mauriel Kapouytian Woods, Lana was an associate at a law firm in Melville, New York where she drafted and prosecuted patent applications and managed a docket of more than 200 pending patent applications in wireless telecommunications including LTE, 3G and 4G systems, mobile devices and applications, medical devices, digital media broadcasting, security, software and GUI technologies. Additionally, Lana counseled and advised clients and foreign associates on claim drafting, interpretation, appeal procedures and licensing.
While at Brooklyn Law School, Lana was a student associate at the Brooklyn Law Incubator and Policy Clinic where she managed a patent legal team of four interns in providing legal services to emerging technology companies. Lana was also a legal intern for Elizabeth Arden, the United Nations, and the U.S. Attorney’s Office. Lana was also the founder and president of the Eastern European Law Students Association.
Prior to law school Lana was a lead software engineer at Selerant Corporation. She planned, managed and developed software used by Consumer Packaged Goods companies for formulation management and regulatory compliance. The software utilized C#, .NET, HTML, XML and SQL. Prior to that, Lana was a software developer for a New York City government agency. Lana is fluent in Russian and proficient in Armenian.
Education
Brooklyn Law School J.D., 2010 Intellectual Property, Media, and Information Law Certificate Hunter College B.A., cum laude, Computer Science, 2004
Bar Memberships
Admitted in New York and New Jersey United States Patent and Trademark Office registered
Parsamyan Tiran
Cell: 89165837282; 89651280611. E-mail: [email protected] Skype: t.parsamyan.lawyer Adress: 129085, Russian Federation, Moscow, Zvezdnij blvd, 5, ap. 46
Education: University Period Qualification Russian-Armenian (Slavic) State University, Lawyer 2001-2006 Yerevan, Armenia Moscow State Academy on Patent Rights 2016 Specialist on patent law Moscow State University on Foreign 2017 – till Magister on international law and translating Relationships (MGIMO University) now from English to Russian.
Thesis: Intergovernmental regulation of foreign investment in Republic of Armenia (comparative analysis). (The defense is scheduled for end of 2019). Experience: Employer Time Position LLC «SPEHRE» LAW FIRM» 01.2016 – till now Head of Legal Department
LLC «Strojindustrija» 12.2012 – 08.2013 Lawyer LLC «Virtus-stroj» 03.2012 – 03.2013 Lawyer LLC «Vneshgenaudit» 12.2009 – 12.2011 Head of Legal Department CC «Bank VTB (Armenia) » 09.2007 – 08.2008 Senior Specialist at Legal Department CC «BTA InvestBank» 06.2007 – 09.2007 Specialist at Crediting of SME Department Armenian Apostolic Church 12.2006 – 06.2007 Head of Legal Department LLC «Germek» 07.2006 – 12.2006 Head of Legal Department
Additional information: - Author of 18 scientific articles; - Participated as consultant during the development of internal standard acts on personnel problems - Report on Problems of current industrial law was awarded at the international conference “Lomonosov 2008” (1st rank, Moscow State University); - Leader of the Student Community at the Russian-Armenian (Slavic) State University for the period from 2003 to 2004. - Awarded with special state grant of Russian Federation Government; Order #167 of Federal Agency of Education dated 14 October 2004.
Mark Kachigian
Mark Kachigian is a shareholder at Head, Johnson, Kachigian & Wilkinson, PC in Tulsa, Oklahoma, USA. He has extensive intellectual property law experience in patents, trademarks, copyrights and other intellectual property both in the U.S. and worldwide.
He is a former adjunct intellectual property law professor at the University of Tulsa College of Law. He designed a law school intellectual property law course curriculum at Yerevan State University in Armenia (the first post-Soviet era IP curriculum) through the ABA Rule of Law Initiative.
He is a member of the International Trademark Association and its Leadership Development Committee and chairs one of the subcommittees. He has been a table topic leader at the INTA annual meeting. He has also spoken at the American Intellectual Property Law Association (AIPLA) annual meeting.
Raffi V. Zerounian Partner
Raffi specializes in intellectual property and commercial litigation, with an Los Angeles emphasis on trademark and copyright litigation. Hanson Bridgett LLP Trademark Litigation and Prosecution 555 S. Flower St, Suite 650 Los Angeles, CA 90071 Raffi has a 360-degree trademark practice, handling all facets of 213-395-7621 Direct Phone counseling, clearance, prosecution, enforcement, and litigation. Raffi has 213-395-7615 Fax pursued hundreds of trademark-enforcement disputes and has been lead counsel in many federal-court trademark-infringement actions. Raffi has [email protected] also extensively litigated opposition and cancellation proceedings before the United States Patent and Trademark Office's Trademark Trial and Appeal Board, as well as domain name disputes through the Uniform Practices/Industries Domain Name Resolution Policy (UDRP). Intellectual Property Litigation & Dispute Resolution As part of his practice, Raffi also manages domestic and international trademark portfolios, and has overseen opposition and cancellation proceedings in countries and jurisdictions outside the United States with his network of trusted local attorneys.
Raffi also has experience in stopping the sale of counterfeit goods. This ranges from investigating and stopping the counterfeiting at its source (often internationally) through litigating counterfeiting disputes in federal court.
Raffi is active in the International Trademark Association. He has been a Senior Editor for The Trademark Reporter since 2012, is currently chair of the Editor Training Subcommittee, and has served on the journal’s Editorial Board since 2008.
Raffi is a recommended expert in the World Trademark Review, and is ranked in the silver category for “Individuals: enforcement and litigation” and the bronze category for “Individuals: prosecution and strategy.” “Concise and hands-on”, Zerounian possesses “superior knowledge of trademark law, including the procedures for both trademark prosecution and litigation.” Enforcing and protecting a brand’s value is his specialty: “He is dogged about going after infringers and always gets results.” “He is the type of fierce advocate that a client wants on its side – yet he is always practical and affable, keeping the client’s business and interests at the heart of his efforts.” Raffi has been named to SuperLawyers and previously SuperLawyers Rising Stars for Intellectual Property Litigation.
Copyright Litigation and Prosecution Raffi V. Zerounian Partner
Raffi has significant experience with copyright litigation, including handling matters ranging from cutting-edge copyright infringement litigation involving technology to stopping the sale of knock-off art. He also has significant expertise in using copyright law to stop infringement on the Internet. Raffi has experience with fair use claims, literal and non-literal copying claims, secondary liability, and contributory infringement. Raffi also has experience with copyright prosecution and counseling.
Commercial Litigation
Raffi has significant experience in a variety of domestic and international commercial litigation disputes, including in state and federal courts as well as in arbitration. His experience includes disputes involving breach of contract, fraud, business torts, partnership disputes, trade secret misappropriation, and adversary proceedings in bankruptcy court.
Raffi began his legal career as a law clerk to The Honorable Ernest M. Robles, U.S. Bankruptcy Judge for the Central District of California. Prior to joining Hanson Bridgett, Raffi practiced at Townsend and Townsend and Crew LLP (now Kilpatrick Townsend & Stockton LLP) and founded a boutique intellectual property law firm in Beverly Hills.
Publications
"Attorney Spotlight On Julio Avalos, Chief Business Officer and General Counsel of GitHub," CMCP Diversity Matters Newsletter (Summer 2016)
"Revised California Rules Intended to Streamline Demurrer Process With New Meet-And-Confer Requirements," co- author, CMCP Diversity Matters Newsletter (Spring 2016)
"Northern District of California Grants Motion to Dismiss TCPA Case against WhisperText with Prejudice," Cyberspace Law Committee E-Bulletin (September 2015)
"The FTC’s Revised .com Disclosures Guidelines and Celebrity Endorsements in Space-Constrained Ads Using Social Media," Cyberspace Law Committee E-Bulletin (2013)
"Ethical Implications of Attorneys’ Use of the Cloud," Cyberspace Law Committee E-Bulletin (2012)
"Practice Tips for Dealing with Brand Misuse in Social Media," co-author, American Bar Association, Section of Litigation, Corporate Counsel (2011)
"Foreword of the Annual Review of Law and Technology," 18 Berkeley Tech. L.J. 1 (2003), Berkeley Technology Law Journal (2003)
"Note, Bonneville International v. Peters," 17 Berkeley Tech. L.J. 47, Berkeley Technology Law Journal (2002)
Presentations
“Basic Legal Skills to Advise Clients Doing Business Online,” State Bar of California's Sections Conventions (August 2017)
“Ethics of Lawyering in a Digital Age,” State Bar of California Webinar (February 2017) Raffi V. Zerounian Partner
"Cyberspace Law 101: Representing Clients on the Internet," California State Bar Annual Meeting (September 2016)
"Basic Legal Skills Necessary for Advising Clients Doing Business Online," State Bar 88th Annual Meeting (October 2015)
"Hot Topics: Digital Evidence at Trial," State Bar of California Cyberspace Law Committee Webinar (June 2015)
"Cyberspace Law: Recent Developments in Intellectual Property, eCommerce and Privacy," panelist, California State Bar Annual Meeting (September 2014)
"Review of Recent and Pending Trademark Cases and Predicting Their Effect," panelist, Intellectual Property Institute of the Pennsylvania Bar (March 2014)
"Review of Recent and Pending Trademark Cases and Predicting Their Effect," panelist, American Bar Association Annual Meeting (August 2013)
"Cyberspace Law Boot Camp," panelist, California State Bar Annual Meeting (2013)
“Ethical and Practical Implications of Cloud Computing,” First District Appellate Project’s Annual Seminar (2013)
“Legal Ethics in the Cloud and Practical Tips for Intellectual Property Enforcement in Social Media,” California State Bar Hot Topics Series (2012)
“Top 10 Ethical and Practical Implications of Moving to the Cloud,” LegalTech Conference (2012)
“Intellectual Property and Social Media: What You Need to Know,” panelist, Armenian Bar Association (2011)
Honors & Awards
World Trademark Review, Silver category - "Individuals: enforcement and litigation" (2017)
World Trademark Review, Bronze category - "“Individuals: prosecution and strategy” (2017)
Southern California Super Lawyers, Intellectual Property Litigation (2014-2017) Raffi V. Zerounian
Southern California Super Lawyers, Rising Star, Intellectual Property Litigation (2013)
Professional Affiliations
Cyberspace Law Committee, Business Law Section of the State Bar of California (2011-2015), Co-Chair (2014-2015), Co-Vice Chair (2013-2014)
The Trademark Reporter® – International Trademark Association, Senior Editor (2012-present)
The Trademark Reporter® – International Trademark Association, Editorial Board (2008-present)
Los Angeles Intellectual Property Law Association, Member Raffi V. Zerounian Partner
Armenian Bar Association, Member
Association of Business Trial Lawyers, Member
Judicial Clerkships
Law Clerk for the Honorable Ernest M. Robles of the U.S. Bankruptcy Court for the Central District of California
Extern to The Honorable Andrew J. Wistrich, Magistrate Judge for the United States District Court for the Central District of California
Academic Distinctions
Berkeley Technology Law Journal, Annual Review Editor and Articles Editor
Boalt Hall Student Association, 3L Class Co-President
McBaine Honors Moot Court Competition, Co-Director; Moot Court, Board Advisor; Law & Technology Writing Seminar, Advisor
Education
J.D., University of California, Berkeley Boalt Hall School of Law (2003)
B.A., high honors, University of California, Santa Barbara (1999)
Admissions and Courts
California
Armenian Bar Association 2018 Mid-Year Meeting
US and International Trademark Law
Raffi V. Zerounian, Partner, Hanson Bridgett LLP Los Angeles/San Francisco Trademark Law Overview
Trademarks identify the source of a product or service.
Common law rights:
geographic area; some states have protection but provides little more than common law.
Federal trademark registrations in the US and abroad. Examples of Trademarks Trademark Overview
Continuum of trademark strength
• The strongest marks: fanciful, arbitrary, or suggestive like EXXON, KODAK, or COPPERTONE.
• The weakest marks: merely descriptive, geographic, or personal names. Trademark Overview
The Test for Trademark Infringement: Likelihood of Confusion using the Sleekcraft Factors
Strength of the mark Generic, descriptive, suggestive, arbitrary or fanciful. Similarity of the Marks Similarity of the marks as encountered in the marketplace Proximity of the goods Complementary, sold to same class of purchasers, similar in use and function. Evidence of actual confusion Marketing channels used Sophistication of consumers Intent in selecting the mark Likelihood of expansion of product lines Trademark Clearance and Prosecution
• Trademark law is territorial.
• The laws of each jurisdiction are different.
• Clear and register in key jurisdictions, including where the trademark will be used, where products are manufactured, and where bad faith filings are common. Trademark Clearance
• Is the trademark available for use and registration? – Run searches online (e.g.,http://www.wipo.int/branddb/en/index.jsp) or online vendor searches (e.g., Clarivate, or Corsearch)
• Is the mark inherently registrable?
• Have local lawyers run formal trademark searches in each jurisdiction. Trademark Prosecution
• Decide what jurisdictions to cover and budget.
• First-to-file versus first-to-use jurisdictions.
• Direct filings versus Madrid Protocol: – The Madrid Protocol may be a cost effective way to secure broad coverage in signatory countries – Risk of “central attack”
• Timeline for filing through registration. Trade Secret Overview
“Three people may keep a secret if two are dead” Benjamin Franklin Trade Secrets—What is a Trade Secret?
Under California Civil Code sections 3426.1-3426.11 and the Defend Trade Secret Act of 2016, trade secrets include common, every-day pieces of data if a company takes reasonable measures to protect its information and that information derives economic value from not being generally known. This may include customer lists, business plans, spreadsheets, corporate minutes and agendas, and bid specifications can be afforded protection as trade secrets. Any information that may be used in the operation of a business and that is sufficiently valuable to afford an actual or potential economic advantage. Examples: Formula for Coca-Cola; compilations of information that provide a competitive advantage, such as customer databases, advertising strategies; customer lists, business plans, spreadsheets, corporate minutes and agendas, and bid specifications. Armenian Bar Association 2018 Mid-Year Meeting The StartUp Revolution: What Are Your Rights and How to Protect Them
U.S. and International Patent Law
Introduction to Protecting Innovation in the U.S. and Around the World and Issues Faced by Companies Doing Business in the U.S.
October 13, 2018 Lana Akopyan, Esq. Mauriel Kapouytian Woods LLP +1.212.529.3356 [email protected] www.mkwllp.com What is Patentable o Process, machine, manufacture, or composition of matter that is: . New (35 U.S.C. § 102) . Useful (35 U.S.C. § 101) . Non-Obvious (35 U.S.C. § 103) o EXCEPTIONS . Laws of Nature . Natural Phenomenon (e.g., naturally occurring chemicals and life forms) . Abstract Ideas (often applied to block certain types of software patents)
2 Mauriel Kapouytian Woods LLP What’s in a Patent?
Three sections:
1. Description
2. Drawings
3. Claims
3 Mauriel Kapouytian Woods LLP Drawings and Description
Must describe specific “embodiments” / implementations of the invention in sufficient detail “to enable one of ordinary skill in the art to make and use the invention”
4 Mauriel Kapouytian Woods LLP Description
This is often referred to as simply “the specification”; but, in fact, “specification” formally includes both the description and claims
5 Mauriel Kapouytian Woods LLP Claims
“the invention is limited only by the appended claims What is claimed: 1. An output driver comprising: a pull-up transistor . . a first voltage response circuit . . .”
6 Mauriel Kapouytian Woods LLP The Patent Dilemma: Words versus Inventions U.S. Supreme Court:
“Unfortunately, the nature of language makes it impossible to capture the essence of a thing in a patent application. . . . Things are not made for the sake of words, but words for things.”
Festo Corp. v. Shoketsu Co. 535 U.S. 722 (2002) (quoting Court of Claims)
7 Mauriel Kapouytian Woods LLP Patent Scope
• Claims define the patent’s scope • Claims are a series of legalistic statements precisely defining the scope of the invention • Claims must define something that is new and non-obvious relative to the “prior art” • To be infringed, all elements of a claim must be in the “accused device” (e.g., competitor’s device) • Claims typically layered from broad to narrow to provide “fall back” positions in case patent office • Claims are interpreted in view of the specification and prosecution history, so it is important for the attorney to draft the drawings and description in a way that supports a broad interpretation of the claims
8 Mauriel Kapouytian Woods LLP Patent Scope (Cont.) o Challenge is to get claims issued that are narrow enough to distinguish the prior art, but broad enough to cover competitive products . Claim: A widget comprising A, B, and C . Competitor makes a widget having A, B, C, and D . Prior art reference 1 teaches a widget with A and B . Prior art reference 2 teaches a widget with C RESULT: • Claim is infringed • Claimed invention is NEW • Claimed invention MAY or MAY NOT be invalid as OBVIOUS -- depends on whether one of ordinary skill before the patent was filed would have been motivated to combine reference 1 and reference 2 to make the claimed widget
9 Mauriel Kapouytian Woods LLP Patent Scope (cont.) o Claims typically layered from broad to narrow to provide “fall back” positions in case patent office (or a court) rejects broader positions • Claim 1: “A widget comprising sticks, stones, and straw” • Claim 2: “The widget of claim 1 further comprising dirt” • Claim 3: “The widget of claim 1 wherein each stone has at least one jagged edge” • If claim 1 is invalid, claims 2 and 3 might still be valid and infringed
10 Mauriel Kapouytian Woods LLP Patent Scope (cont.) o Claims are interpreted in view of the specification and prosecution history, so it is important for the attorney to draft the drawings and description in a way that supports a broad interpretation of the claims. “In one embodiment of the invention, the sticks are wood. In another embodiment of the invention, the sticks are plastic.”
11 Mauriel Kapouytian Woods LLP U.S. and Global Patent Protection
International Patent System . Almost all potentially relevant jurisdictions in the world covered by international treaties that create a global patent system, most significant treaty is the Patent Cooperation Treaty (“PCT”) (28 UST 7645; TIAS 8733) . entered into force January 24, 1978; amended on October 2, 1979, and modified on February 3, 1984, and October 3, 2001 . Patent filing in any one of the PCT countries can be the basis for pursuing protection in all other PCT countries . Example: Company from anywhere in the world can initiate global patent protection in the U.S. and then later pursue protection under the PCT in other countries, including countries in Europe, Asia, Australia, many parts of Africa, and almost all of North, Central, and South America
12 Mauriel Kapouytian Woods LLP U.S. and Global Patent Protection
• International Patent System (cont.) • Allows for cost and decision deferral: • File in one country first • Then file one PCT application within a year • Then file national stage applications in other countries up to 30 or more months after initial filing (depending on jurisdiction) • Notable exception: In Taiwan, must file within one year of U.S. filing • Pursuing global protection very expensive, so important to prioritize and pursue most important jurisdictions first • International PCT system allows you to have extended time period before having to decide on all the individual jurisdictions for pursuing protection
13 Mauriel Kapouytian Woods LLP U.S. and Global Patent Protection
• Filing in U.S. first versus Europe • Under international system, a Armenian company can initiate filing in either jurisdiction and then later pursue protection in the other (and elsewhere) • Initial filing costs similar, though somewhat higher in Europe • However, European Office charges annual fees while the application is pending • U.S. does NOT charge annual fees while pending • U.S. provides reduced fees for “small entities” (for most industries, entities under 500 employees can potentially qualify)
14 Mauriel Kapouytian Woods LLP U.S. and Global Patent Protection
• Filing in U.S. first versus Europe (cont.) • Because costs during pendency generally are greater in Europe than in the U.S., filing in the U.S. first rather than Europe can offer greater cost deferral • A patent attorney in the jurisdiction of first filing will inevitably tailor the application more specifically with the laws of that jurisdiction in mind • therefore, if the U.S. to likely be the largest market for your product, preference for having the application initially tailored to U.S. law and doing the initial filing in the U.S.; the opposite applies if Europe will likely be the largest market
15 Mauriel Kapouytian Woods LLP U.S. Patent Prosecution Overview (with relevant international deadlines)
1 year 2 years 3 years
Initial st 1 office 2nd office Allowance filing in U.S. action action and issue File PCT Applicant Restriction Applicant application response response requirement from due in (preserves due in USPTO (if multiple 3‐6 months international 3‐6 months inventions) ; rights) respond by Begin filing selecting primary national stage invention applications in non‐U.S. jurisdictions
16 Mauriel Kapouytian Woods LLP U.S. Patent Prosecution Overview (cont.)
• If allowance not obtained after two office actions, various procedural options including appeal or a request for continued examination • In general, patent prosecution is a negotiation with the patent office: Begin with broad scope (defined in the patent “claims”), then narrow the scope in response to push back from the patent office • Patent Examiners use Manual of Patent Examining Procedure(MPEP) published by the USPTO • 500+ pages describing laws and regulations, organized by topic, that must be followed when examining U.S. patent applications • Timeline for patent office actions on previous slide is only a rough estimate • Patent applications for non-software inventions (e.g., electronics, mechanical, biomedical, chemical) generally proceed through USPTO examination within 3 years • Patent application for software inventions often take longer, 3-5 years, sometimes even longer if significant push back from USPTO
17 Mauriel Kapouytian Woods LLP When to file?
• IF ONLY FILING IN THE U.S. : within one year of public disclosure or offer for sale • If plan to file anywhere else in the world, then must file first application (in U.S. or other jurisdiction) BEFORE ANY PUBLIC DISCLOSURE • U.S. is a “first to file” system since the Leahy-Smith America Invents Act • patent reform, amends title 35 of the United States Code (35 U.S.C.) • Since 2012 change in law, U.S. is a “first to file” rather than “first to invent” system for determining priority, so better to file sooner rather than later • You do not need to have implemented an actual working prototype of the invention prior to filing; HOWEVER, you need to have figured out enough detail so that one “skilled in the art” could make and use the invention based on your patent application disclosure
18 Mauriel Kapouytian Woods LLP Costs: U.S. Filing and Prosecution
• Varies significantly based on invention • Initial patent filings for startup companies often more expensive than patents for mature technology companies • Startups generally need extra help from patent attorney defining inventions before the patent application can be written • Often what the inventors think is a single invention is in fact multiple inventions requiring multiple patent applications to cover sufficiently
19 Mauriel Kapouytian Woods LLP Costs: U.S. Filing and Prosecution (cont.)
• U.S. Initial patent preparation and filing costs (including attorney fees and government fees) • for startup companies: $12,000 – $30,000+ per application depending on complexity • for mature technology companies (incremental inventions): $8,000- $12,000 per application; more for particularly complex inventions • U.S. Patent prosecution costs (spread out 2-3 years after filing): $6,000-$10,000 + depending on degree of complexity and degree of push back from the patent office
20 Mauriel Kapouytian Woods LLP Costs: Preserving and Pursuing Global Rights
• PCT Application, 12 months after U.S. filing: $3,500 - $4,000 (attorney fees plus government fees) • National / Regional stages applications (30-32 months after initial U.S. filing), cost varies significantly depending on jurisdiction: • Europe and Japan most expensive • Korea. China, Australia, and Canada somewhat less expensive • At least several thousand dollars per jurisdiction to file and then more to prosecute; therefore, need to be selective on pursuing protection globally
21 Mauriel Kapouytian Woods LLP Patent Protection: What you get o Term: Patent enforceable from date of issuance until 20 years from the earliest filing date o Nature of protection: Right to exclude others from making, using, selling, or importing into the U.S. the invention claimed. Does NOT provide a positive right to make use or sell what is in the patent, EXAMPLE: . You have a patent on a device containing elements A, B, and C . Competitor has a patent on device containing elements A and B . RESULT: You might need to license competitor’s patent to make your device (A and B are part of device containing A, B, and C); competitor can make a device containing only A and B, but would need a license from you to make a device containing A, B, and C; potential cross-license
22 Mauriel Kapouytian Woods LLP Patent Protection: What you get (cont.)
• Nature of protection: Right to exclude others from making, using, selling, or importing into the U.S. the invention covered in the patent
• Does NOT provide a positive right to make use or sell what is in the patent, EXAMPLE: • You have a patent on a device containing elements A, B, and C • Competitor has a patent on device containing elements A and B
RESULT: You might need to license competitor’s patent to make your device (because A and B are part of device containing A, B, and C); competitor can make a device containing only A and B, but would need a license from you to make a device containing A, B, and C; therefore potential cross-license
23 Mauriel Kapouytian Woods LLP Is Software Technology Patentable?
• Short answer: YES, new patents on software inventions are issued every day • Long answer: Patenting software is challenging, the more “technical” and specific the software invention, the better • A computer system that merely automates an pre-existing business process is difficult to patent • Bilski v. Kappos 561 U.S. 593 (2010) • Mayo Collaborative Servs. v. Prometheus Labs, 566 U.S. 66 (2012) • Alice Corp. v. CLS Bank, 134 S. Ct. 2347, 573 U.S. _ (2014) • Example 1: An Accenture patent for an insurance transaction system was recently held to be invalid (Accenture versus Guidewire, Federal Circuit, Sept. 5, 2013); court found the claims to be related merely to “concepts for organizing data” rather than “a specific device or system”
24 Mauriel Kapouytian Woods LLP Is Software Technology Patentable? (cont.)
• A computer system/method that solves a specific technical problem, more likely patentable • Example 2: A patent asserted against Microsoft relating to a “half-toning” technique for digital image processing was held to be patentable subject matter (RCT v. Microsoft, Fed. Cir. 2010) • Between example 1 and example 2: Large “gray area” in which a particular software-related invention may not be patentable; U.S. law struggling to draw the line • In the meantime, technology companies continue to pursue and obtain patents on software inventions, many of which have significant value
25 Mauriel Kapouytian Woods LLP The Pre-Filing Patent Application Process
0 year 1 year Pre-filing 2 years 3 years
o Inventor creates Initial st disclosure document 1 office 2nd office Allowance filing in action action and issue o Initial meeting with U.S. File PCT Applicant Applicant attorney application response response due in o Follow-up on (preserves due in disclosure questions international 3-6 3-6 rights) months months o Attorney prepares 1-3 Begin filing draft months national stage o Inventor reviews / applications in answers open non-U.S. questions jurisdictions
o Attorney finalizes draft for filing 26 Mauriel Kapouytian Woods LLP The Pre-Filing Patent Application Process
• Inventor creates disclosure document • Initial meeting with attorney • Follow-up on disclosure questions • Attorney prepares draft • Inventor reviews / answers open questions • Attorney finalizes draft for filing
27 Mauriel Kapouytian Woods LLP The Pre-Filing Patent Application Process
• Disclosure Document: Detailed description of the invention. May include attachments with further description, is ideally is provided to the patent attorney for review prior to the attorney’s initial disclosure meeting with the lead inventor • Inventor/patent attorney meeting: Between a patent attorney and the lead inventor to discuss a particular invention for patenting and discuss the patenting process and pre-filing logistics • At the meeting: The patent attorney asks questions of the inventors to obtain additional information as needed for the patent application
28 Mauriel Kapouytian Woods LLP The Pre-Filing Patent Application Process
• Draft patent application prepared: Typically within about two months, the patent attorney drafts the patent application, including text and drawings, and emails it to the lead inventor for review and feedback/comments • Finalize and file: Any inventor comments are incorporated, and a finalized version of the patent application is emailed to the inventors, along with formal documents for signature and return. The patent application is then filed with the U.S. patent Office.
29 Mauriel Kapouytian Woods LLP Reasons to get Patents
• Potentially strongest form of IP protection • Protects again competitor independently developing the same technology (as defined in the claims) • — Note: copyright and trade secret do NOT provide this protection • Generally not limited to a particular implementation • Provides defensive arsenal against competitor patents • Leverage for technology partnerships (“don’t do this yourselves, we have the patents on it, so pay us to do it for you”) • The process itself builds and systematizes a company culture of innovation • Motivates inventors to disclose their inventions internally • Motivates inventors to improve upon existing technology • Creates a clear record of employee inventions owned by the company
30 Mauriel Kapouytian Woods LLP Reasons not to get patents • Requires public disclosure, e.g., algorithms that might not otherwise be visible to product users would have to be disclosed at some level of detail in the patent application • Can mitigate this risk for U.S.-only application by filing Non- Publication Request, then only publishes if the patent issues • Takes time and money to manage the process internally and to hire and work with outside patent counsel • Even if you get a patent, its enforceability is not guaranteed • Can mitigate this risk with portfolio approach
31 Mauriel Kapouytian Woods LLP Why Should Armenian Companies Get U.S. Patents? Top Three Reasons: (1) Revenue opportunity (2) Defensive strength allowing safer entry into new product markets (3) Safer disclosures and leverage in partnership, financing, and business development interactions
32 Mauriel Kapouytian Woods LLP Technology Licensing Cross-Border Revenue: Global Trend
$Billions per year (Source: World Intellectual Property Organization)
200+? 200 180
150
100
50 27
0 2.8 1970 1990 2009 2013
33 Mauriel Kapouytian Woods LLP U.S. Patent Revenue Market
• U.S. market for patent licensing estimated in 2006 at $150 billion (source: AIPLA Annual Meeting Papers, 2006)
• Patent Sale Market • Top ten patent portfolio sales of 2012 alone generated over $20 billion (source: www.ideabuyer.com) • Patent Assertion Entities have created new market for small portfolios • Intellectual Ventures alone has purchased 70,000 patents since 2000 (source: Reuters, Oct. 3, 2013)
34 Mauriel Kapouytian Woods LLP Defensive Strength for Entering U.S. Market Scenario 1: Company has no U.S. patents
Armenian tech company enters U.S. product market
Competitor (U.S. or non-U.S.) threatens Armenian company w/ U.S. patents
• Armenian company shut out of market • Potential damages or settlement Armenian company spends payment: $5-50 million + $1-5 million on legal fees • Armenian company spends $2-10 million on legal fees 35 Mauriel Kapouytian Woods LLP Defensive Strength for Entering U.S. Market Scenario 2: Company has U.S. patents
Armenian technology company enters U.S. product market
Competitor threatens Armenian company w/ U.S. patents
Armenian company counter threatens competitor with U.S. patents
Companies analyze respective threats, negotiate cross‐license Legal fees < $500K
36 Mauriel Kapouytian Woods LLP Strength / Leverage in Dealings with Potential Partners, Funders, Acquirers • Many large companies and venture capital firms in U.S. will not sign non-disclosure agreements with small companies • Even if non-disclosure agreement signed, relatively weak protection • Time-limited • Difficult to prove necessary facts for enforcement • General expectation of sophisticated entities that you will rely on your intellectual property rights rather than a non- disclosure agreement for protection
37 Mauriel Kapouytian Woods LLP Strength / Leverage in Dealings with Potential Partners, Funders, Acquirers (cont.) • With patent rights in place, can be more confident in discussing technical details with other entities • For large company potential acquirer, if target has patents, more incentive to buy rather than copy protectable investment
38 Mauriel Kapouytian Woods LLP Intellectual Property Protection in International Investment Agreements and Russian National Law
By Tiran Parsamyan
The inclusion of IP rights in the definition of ‘investment’ in investment treaties reflects the importance of protecting such intangible assets in many investment operations. IP may be significant strategic asset, and is all the more important in the light of the rapid development of advanced industries, such as biotechnology and pharmaceuticals, which rely on patent and know-how protection.
Every international investment, whether in the form of equity, debt or IP, is based on the bargain, a ‘deal’ between the foreign investor and the host government of the country in which the investment is made. For the foreign investor, the terms of that bargain are to be found in three basic sources:
1. The national legal framework of host country laws and regulations;
2. Contracts that the investor has specifically entered into with the host government and other relevant parties; and
3. International obligations of the host country, usually found in treaties that it has made.
Of the three sources, the significant extent it influences that bargain’s other elements. For one thing, investor property and contractual rights, the basic legal building blocks of their investments, are creatures of national law. National law not only creates the rights, but it may also modify or cancel them. For another, all the basic rules governing the operations of the investment, from taxation to environmental protection, from labor relations to the important raw materials, and of course protection of IP, are matters subject almost exclusively to national regulation.
Should future events lead a government to believe that an increase in the tax rate, a strengthening of environmental standards, to modification of the intellectual property regime is necessary to improve the lives of its citizens, it will normally proceed to make such changes despite the fact that investors – whether foreign or domestic – have relied on the previous national laws in making their investments.
Russian IP legislation consists for the most part of the Civil Code of the Russian Federation, specifically Part IV put into force by Federal Law No. 230-FZ, dated 18 December 2006. Part IV of the Civil Code along with Federal Law No. 231-FZ “On Enacting Part IV of the Civil Code of the Russian Federation,” dated 18 December 2006, have replaced or amended all preceding individual IP laws as of 1 January 2008. Part IV of the Civil Code is a codification of pre-existing IP laws, which have been compiled as chapters in Part IV of the Civil Code with some significant amendments. Parts I–III of the Russian Civil Code also set out certain general provisions pertaining to legal protection of IP rights. Federal Law No. 35-FZ, dated 12 March 2014, introduced a vast set of amendments to Part IV of the Civil Code, part of which entered into force on 1 October 2014 and the second part — on 1 January 2015. Any foreign legal entity or individual may seek protection for its/his/her intellectual property rights in Russia, provided that the requirements of the law are satisfied. Russia is a signatory to major international treaties on intellectual property rights, including the Universal Copyright Convention, the Berne Convention for the Protection of Literary and Artistic Works, the Paris Convention for the Protection of Industrial Property, the Patent Cooperation Treaty, the Madrid Agreement on the International Registration of Trademarks, the Protocol to the Madrid Agreement, the Singapore Treaty on the Law of Trademarks, the Trademark Law Treaty, the Patent Law Treaty, the Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations, the Brussels Convention for the Protection of Producers of Phonograms Against Unauthorized Duplication of Their Phonograms, the Nairobi Treaty on the Protection of the Olympic Symbol, the Budapest Treaty on the International Recognition of the Deposit of Micro-organisms for the Purposes of Patent Procedure, the Strasbourg Agreement Concerning International Patent Classification, the Locarno Agreement Establishing an International Classification for Industrial Designs, the Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks, the WIPO Performances and Phonograms Treaty, the WIPO Copyright Treaty and the WIPO Beijing Treaty on Audiovisual Performances.
Besides, the development of Russia’s legislation on foreign investments began in 1991, when the first law on foreign investments was enacted. This was replaced in 1999 by the currently effective Federal Law ‘On foreign investments in the Russian Federation’ (Foreign Investments Law).
The Foreign Investments Law generally defines the status of a foreign investor, the legal regimes for foreign investments, and guarantees and benefits provided to foreign investors active in Russia, and contain provisions regulating the establishment and operation of companies with foreign investments and branch offices of foreign companies. The Federal Law ‘On investment activity in the Russian Federation in the form of capital investments’ (Capital Investments Law) regulating the investment activities of both national and foreign companies was also adopted in 1999. Provisions concerning foreign investments are also contained in banking, insurance, currency control, foreign trade and other legislation. With the increased flow of foreign investments into Russia, it became clear that the process of investment in strategically important sectors of the economy required more precise control by the state authorities. For this purpose, the Federal Law ‘On procedures for foreign investments in companies having strategic importance for the national security and defense’ (Strategic Investments Law) was enacted, and a special governmental commission with control over foreign investments (Governmental Commission), chaired by the Prime Minister, was formed. Normative acts adopted by the government also constitute a substantial part of the country’s foreign investment legislation, and usually contain guidelines on the implementation of the foreign investment control rules.
Within the framework of international cooperation, the Russian Federation has concluded more than 60 bilateral investment treaties (BITs) with the governments of various countries. Some of these were concluded during the time of the Soviet Union, such as the BITs with Germany and the Netherlands, which were both signed in 1989. Other BITs have been concluded quite recently, such as the BIT with Indonesia, signed in 2007, and the BIT with the United Arab Emirates, signed in 2010.
According to the Foreign Investments Law, the legal regime for foreign investments is generally equal to that for the investment activities of national (local) investors to the extent particularly indicated in the federal laws. Restrictive exceptions to the foreign investments regime may be introduced only for protection of the constitutional fundamentals of morality, health and other rights of persons, or to ensure state security and defense. A foreign investor or commercial organization with foreign investments set up on Russian territory, where the foreign investor owns at least 10 per cent of interest in the authorized capital of an organization, shall enjoy in full the legal protection, guarantees and privileges established by the Foreign Investments Law while performing the reinvestment. A Russian commercial organization acquires the status of a commercial organization with foreign investment from the date when a foreign investor becomes the shareholder thereof. From that moment, the commercial organization with foreign investments and the foreign investor shall enjoy the legal protection, guarantees and privileges established by the Foreign Investment Law. Foreign investors are fully protected against nationalization or expropriation, unless such action is mandated by the federal laws. In such case, foreign investors are entitled to receive compensation for any investment and other losses. However, any affiliated and dependent companies of a commercial organization with foreign investments shall not enjoy the legal protection, guarantees and privileges established by the Foreign Investments Law. The Foreign Investments Law provides a number of guarantees for foreign investors. Inter alia, it guarantees the right of foreign investors to:
a. make investments in any forms permitted by the law;
b. acquire private and government securities;
c. take part in privatizations; and
d. acquire land plots, subsoil resources, buildings and other immoveable property.
In defining the nature of covered investments, most treaties provide a general definition of investments covered by the treaty and the proceed to impose on that definition certain limitations such as the area of the investment’s economic activity, the time when the investment is made, and prescribed legal requirements. The general definition of investment usually includes property rights.
And a fundamental, practical question, of course, is whether countries actually respect their treaty commitments and, if not, whether an injured investor has effective legal redress against a host country’s treaty violations. For foreign investors and their governments, one of the great deficiencies of customary international law has been its lack of effective and binding mechanisms to resolve investment disputes. One aim of the investment treaty movement has been to remedy this situation.
Most investment treaties, provide for two distinct dispute settlement mechanisms: one for disputes between the two contracting states, and another for disputes between a host country and another for disputes between host country and an aggrieved foreign investor. With respect to the former, contemporary investment treaties usually stipulate that in the event of a dispute over the interpretation or application of the treaty, the states concerned will first seek to resolve their differences through negotiation and then, if it fails, through international arbitration.
For the latter, the trend among more recent investment treaties is to provide a separate international arbitration procedure, often under the auspices of the International Center for Settlement of Investment Disputes, for disputes between an aggrieved foreign investor and an offending host country government. Granting a private party the right to bring an action against a sovereign state in an International tribunal is a revolutionary innovation that now seems to be largely taken for granted.
But the situation is different in Russian Federation. In December 2015 in Russia was adopted a law allowing the Constitutional Court of Russia to decide whether or not to comply with judgments made by international courts. The law permits the court to review rulings of international bodies and pronounce them “non-executable” if the court deems they contradict Russian constitution.
This law was drafted in response to a decision by the Constitutional Court in July 2015 stating judgments of the ECHR would not be implemented if they contradicted Russia’s constitution. The decision also stated the Russian constitution would take priority over international law.
This means, that any type of investors which are interested in making business in Russia, must take in to account, that they might be able to protect their investments, including IP in Russian domestic courts, and in case of IP The Court for Intellectual Property Rights (“IP Court”), which is the first IP-dedicated civil judicial body in Russia. It became operational on 3 July 2013. It has exclusive jurisdiction to consider disputes involving intellectual property rights and acts both as the court of first instance and the court of cassation.
As the court of first instance, the IP Court resolves disputes involving challenges of acts of federal state authorities in the IP area as well as various disputes related to granting or terminating the legal protection of IP, including decisions of the federal antimonopoly authority on recognizing actions related to the acquisition of exclusive rights to the means of individualization of legal entities, goods, works, services and businesses as unfair competition;
Within its capacity as the court of cassation, the IP Court considers cases it had previously resolved as a court of first instance as well as cases related to the protection of IP resolved by other arbitrazh courts across the country;
The court is authorized to resolve all disputes mentioned in federal legislation regardless of the parties involved in the case;
Judicial decisions passed by the IP Court as the court of first instance cannot be appealed other than by way of cassation appeal and come into force immediately after adoption. The IP Court resolves IP disputes collegially in the first instance and in cassation, while the Presidium of the IP Court reviews cassation appeals in cases considered by the IP Court in the first instance.