How to Make Sure Your IP Strategy Plan is Not Doomed to Failure

Smart business leaders understand today that IP Strategy should form a fundamental pillar of their value creation-directed business strategy. By taking a "business eye view" toward IP, forward-thinking corporate managers seek to capture the true value of their company, which today is increasingly measured in the form of intangible assets such as patents, trademarks, copyrights and trade secrets.

If you have read this far in this post, you no doubt realize that your company must develop and execute on an IP Strategy in order to maximize intangible asset value. But, IP Strategy is only one part of the process of generating and maximizing this asset value. As an IP and Patent Business Strategist (more info here: The Hutter Group), I have found that even the most robust business-directed IP Strategy is likely doomed to failure if your company does not also establish an IP Culture within your organization. Put simply, as a manager responsible for the execution of your company's IP strategy, you must work to destroy the "IP Expert" silo that likely exists today in your company.

This silo consists of the designated "IP Experts" in your company who are typically R & D-oriented employees and your in-house IP lawyers. In developing IP rights in this typical corporate silo, an R & D employee will notify in-house IP lawyers that he has invented something, and the latter will validate the "inventiveness" of the idea. Together these designated "IP Experts" will decide whether the invention merits protection in a patent or whether it should remain a trade secret. The decision of whether to obtain a patent happens almost exclusively in this "IP Expert" silo. Moreover, if your business leaders are involved at all in this process, they are only involved with power to veto the previous "IP Expert" validation of the value of the invention. And, in my experience, once the "IP Experts" start on the road to obtaining a patent, few business people are willing to overrule the previous "expert" decision to proceed.

By destroying this "IP Expert" silo in your company and replacing it with a business-oriented IP Strategy, you will enable those outside of your corporate R & D and Legal functional operations to generate IP that will more likely directly enhance your corporate intangible asset value. However, it takes more than just destroying your existing "IP Expert" silo to be successful in maximizing your company's IP asset value.

Your company must also foster a community of involvement that will allow each and every employee to understand the value of IP to your company's P & L. In short, your company must work to create an IP Culture throughout your organization. I have come up with this simple formula to demonstrate the relationship between IP Strategy and IP Culture in the realm of IP Value Creation:

IP Value Creation = (IP Strategy) x (IP Culture)

Using this formula, no matter how good your company's IP Strategy may be (or how much money you spend on consultants to develop your IP Strategy), if your company does not establish and nurture an IP Culture (i.e., IP Culture = zero), IP Value Creation will end up being zero. Moreover, if a company short-changes the IP Culture aspect of the equation (i.e., IP Culture value is less than 1), IP Value Creation will be less-than-optimum. On the flip-side, if the organization has a high IP Culture rating, IP Value Creation can be achieved even when there is not a robust IP Strategy on which to execute.

How does your company create an IP Culture? The answer is quite simple: push responsibility for IP outside of the R & D and in-house Legal "IP Expert" silos to those who work at all areas of your company. This requires significant educational efforts because, in most companies, personnel outside of R & D and Legal are not generally able to recognize whether their efforts relate to protectable intellectual property or trade secrets. As a result, they typically do their jobs without awareness that their innovations, if captured and protected, could provide your company with valuable proprietary advantage over competitors.

Under the existing paradigm at your company, your employee's ignorance about the value of her innovations to the organization means that those responsible for capturing and maximizing corporate asset value never find out about her innovation. And, in my view, if an innovation is not identified as having value, this innovation, in fact, has no value and, as an unrecognized asset has no corporate value.

The key to building an IP Culture is to educate your employees who work outside of the "IP Expert" silos of R & D and Legal to recognize protectable innovations and to appropriately notify their managers of their innovations. In short, your employees need to be as much a part of the IP Strategy process as your designated corporate "IP experts".

One way to establish an IP Culture is to have your in-house IP staff serve as "IP Ambassadors" who go out into the company and engage in workshops. This approach has been very effective at IP Strategy and IP Value Creation thought-leaders such as BellSouth (now AT & T), Kimberly Clark and Proctor & Gamble. However, the success of an IP Ambassador program at your company depends on whether your IP experts can tackle a corporate-wide educational effort along with their existing responsibilities.

Another way to work to creating an IP Culture is to engage a consultant such as myself to come in and work with your organization. (Yes, this is a blatant plug for my business.) Use of a consultant to assist you in establishing an IP Culture allows your IP Experts to attend to their day-to-day tasks of protecting the IP that your company has already identified as being valuable. Additionally, use of a consultant to help you create an IP Culture within your organization has the additional benefit of allowing your company to bring best practices in IP Strategy and management that exist outside of your organization.

Regardless of whether your company seeks assistance from The Hutter Group to assist you in developing an IP Culture in your organization, the reality is that you must do something in this regard to successfully create and maximize your IP Value. So, before your organization embarks on an expensive IP Strategy plan, make sure that you are not doomed to failure before you begin because you did not include in your plans development of an IP Culture.

How to Prevent IP Ownership Issues When A Corporate Strategic Alliance, Joint Venture or Open Innovation Project Fails

Technology-focused collaborations form a foundation of today's corporate planning strategies. Such collaborations can be in the form of strategic alliances, joint ventures, open innovation or other legal structures. Regardless of how the participants characterize and legally structure such collaborations, the most common motivation for forming such alliances is to pool technology and R & D resources. When technology and R & D is involved, it must follow that IP ownership issues should loom large in the planning stage of the collaboration. However, my experience shows that the parties rarely give appropriate consideration to IP ownership in the agreements that are supposed to fully set out the rights and responsibilities of the parties.

I can say with authority that IP issues are not usually given proper consideration in collaborative agreements because my expertise in this area results primarily from helping clients after their collaborations have failed. My clients typically sought my help after their collaborations went sour and they sought to exit the relationship with at least some valuable IP rights intact. In each of these situations, it was apparent that if my client had come to me for advice while they were executing the general business and financial parameters of the collaboration agreement, they may not have needed me to fix things on the back-end. Put simply, if I had been brought in on the front-end to put a fine point on IP ownership issues thatA resulting from the collaboration, I would have been able to prevent questions regarding IP rights from even being a question.

My perspective about the preventable nature of IP ownership issues was confirmed when I recently attended a meeting of professionals who focus primarily on strategic alliances and other types of collaborative ventures. In this meeting of just over an hour, I counted at least 5 instances where someone commented something along the lines of "when the relationship goes sour, the IP issues cause problems." From the sighs that accompanied the mention of IP ownership issues, I obtained the clear sense from these seasoned professionals that IP was not only a big problem, but also a common occurrence in their collaborations.

Smart business professionals should realize that when a significant problem occurs on a frequent basis, there likely is a failure in an associated business process. This is the case for IP ownership issues: most of the problems I have addressed on the back-end of a failed collaboration were fully predictable and the resulting problems could have been reduced or eliminated by proper planning. But if common IP ownership issues are not difficult for an Intellectual Property and Patent Business Strategist such as myself (more info here: www.jackiehutter.com) to predict and prevent, why do such issues still occur with such frequency in the collaboration space?

The answer is fairly easy from my vantage point: patent experts are typically not considered as possessing essential business knowledge and, as such, people like me are not seen as necessary participants in a collaboration deal. This is true even when the primary reason for the parties getting together in the first place is to pool existing technology and to create R & D synergies that will result in acceleration of innovation to the benefit both participants.

Admittedly, we patent experts have facilitated our not being involved on the front-end of business matters by traditionally focusing our practices on obtaining patents and litigating them for clients. We have left business matters to business professionals and transactional lawyers because, as a highly specialized profession, we felt more comfortable in the area of our own expertise. Also, we have not generally reached out to educate others about our somewhat "arcane" area of legal expertise. Our knowledge has remained closely held within the confines of patent practice and, as a result, we have been problem fixers. as opposed to preventing problems before they occur.

Business and legal experts reside today in functional silos that effectively prevent communication and education. Unless these silos are broken down, it is inevitable that business professionals will continue to destroy corporate value by not sufficiently including IP ownership in their collaboration agreements. Patent experts can continue to create value for ourselves by expending efforts to preserve our client's IP rights when the collaboration fails.

The definition of insanity was said by Albert Einstein to be "doing the same thing again and expecting a different result". To this end, it is insane for business professionals who deal in the collaboration space to continue to struggle with IP ownership issues over and over again because there is no doubt that complications and disappointment will inevitably arise. While not all of these issues can prevented by up-front analysis, I can virtually guarantee that the cost and effort of resolving IP ownership after a collaboration failure will be considerably less when a business-focused patent professional such as myself is brought in at the collaboration planning and agreement preparation stage.

Confessions of a Non-Recovering Patent Troll Enabler

I came across this TechDirt article: Exposing The Patent Troll Playbook... And How To (Almost) Beat It (h/t Ron Carson, VP of Marketing at Innovation Asset Group). This is an insider's account of what it is like to be the victim of a so-called "patent troll". Perhaps better than the article itself are the comments which make it clear how passionate people are about the topic of patent trolls. This is recommended reading, if just for the entertainment value of the comments.

Reading the TechDirt article made me recall my time as a junior litigator at a well-known Atlanta law firm. As a very green (and tired) young attorney, I sent many "licensing offer letters" for the AudioFax Company. In this role, I was an enabler of a very successful patent troll. And, as set out in this post, I have continued to enable patent trolls throughout my more than 13 years as a patent attorney and intellectual property business strategist.

The story of AudioFax is summarized here, albeit in softball form. In short, AudioFax's owner, Mark Bloomberg, was an entrepreneur selling fax equipment in the 1980's. Another company, F-Mail, received a patent on the technology that Bloomberg was selling and came after him. Seeing an opportunity in fax patent licensing, Bloomberg acquired F-Mail's patent, as well as obtaining two more patents of his own. Bloomberg hired a patent licensing company to scout out potential licensees and my law firm to send out letters. Thus, his successful journey as a "patent entrepreneur" began.

I left AudioFax's law firm in 1998 to embark on a more focused career as a geeky patent attorney, and I am now an IP and patent business strategist (more info here: The Hutter Group). Over the years, I forgot all about about my work with AudioFax. Recently, however, I met a patent broker whose company handled the sale of the AudioFax patent portfolio to Catch Curve in 2005, and I became interested in seeing what had happened in the AudioFax patent saga. I then began to Google the history of AudioFax and saw that the company's "licensing program" continued in earnest for many years after and apparently still does to this day.

There is no doubt that AudioFax meets the definition of "patent troll". For example, AudioFax never made or sold a product covered by its patents. Its revenue stream resulted only from the licensing fees obtained from its patents. The AudioFax patents have been licensed to over 30 companies including Cisco, AT & T and 3Com. Reportedly, AudioFax made millions from its licensing program, which is likely more than its founder would have made from actually selling fax products.

As a patent litigator for AudioFax, I clearly enabled their patent troll activity. However, it may not be readily apparent that, as a patent lawyer, I also enabled patent troll-like activity for many clients that would not fit readily be perceived as patent trolls. That is, over the years, I have obtained many patents for entities that had no interest in ever making or selling a product associated with that patent. This was of no concern to me: if the client had a patentable idea and had the money to obtain a patent, I would do what I needed to get him the patent. So, if a patent troll is an entity that obtains a patent for the express purpose of licensing or enforcement against another, then I have enabled this activity. I not ashamed of this work, rather, I am proud of what I have done for these so-called "patent trolls" over the years.

As used in the press, the term "patent troll" is clearly pejorative: they are lurking to attack the unsuspecting good guys who are trying to get across the bridge to do their business. In this context, the activities of patent trolls must necessarily be bad for business. The argument here is that a company that is actually making a technology or product should win out against a patent holder that does not seek to sell that same product or technology to the public. In this scenario, companies like AudioFax should be punished for having the foresight to protect their good ideas and enforcing their patent rights against companies that came up with those ideas at a later date and seek to commercialize those ideas.

But taking this contention to its logical extension, any person or entity that does not immediately plan to introduce a product or technology into the market should not be able to fully enforce its patent rights against someone who does seek to bring that idea to market. This group (which accurately reflects my client base over the years) would include universities, entrepreneurs with good ideas but limited means and any company that seeks to protect its R & D investment from its competitors through patents. Obviously, this is an absurd result.

Those arguing against patent trolls may have been on the receiving end of a "licensing offer letter". As a senior corporate patent lawyer, I received several of these and receipt of such letters did complicate my practice. Handling of these letters took me away from developing patent rights for my employer that I would have been very happy to license to or enforce against others regardless of whether or not my company was making the product covered by that patent. In other words, I would have enthusiastically sent a licensing enforcement letter if there was a legitimate business purpose for doing so, but it was not pleasant to be on the receiving end of these letters.

An objective view of the activities of that define the business pain caused by patent trolls should reveal a less sinister picture. That is, a patent troll is nothing other than an entity that had the business acumen and foresight to understand the power of the U.S. Patent system to create value for those who execute on this opportunity. As a society, we have decided that those who choose to tell the world what cool ideas they have come up with, as opposed to keeping those ideas secret, will be rewarded with exclusive rights for a limited time. If you don't like it, call your Congressman. In the meantime, however, you can sit and complain about the problems that patent trolls supposedly cause to your business, or you can get on the bus and develop and execute on a value creation directed patent strategy.

When your company executes on a patent strategy that is aligned with your business plans, there should be little need to worry about patent trolls because your management will know under which patent and technology bridges patent trolls are lurking. Also, your company will be able to develop and enforce patent rights that have affect your competitors; that is, your company could be seen as a patent troll to others. However, I am sure your C-level management will not refer to your company as a patent troll but, rather, as a smart and modern business.

Response to WSJ Online Article: What Business Owners Should Know About NOT Patenting

Today, the Wall Street Journal Online published an article entitled "What Business Owners Should Know About Patenting". In this article, Stuart Weinberg interviews James McDonough, an attorney at the well-respected Fish & Richardson law firm. Mr. McDonough gives excellent advice about the process of building an intellectual property portfolio.

However, he skips over a crucial first step--does building a patent portfolio really create long term value for your business? In many cases, the answer will clearly be "yes". In many other cases, building a intellectual property portfolio could actually reduce or destroy your company's asset value. By focusing his advice on the portfolio building step and later, Mr. Donough ignores the foundation on which your company should start the portfolio-building process.

First, an admission: I created a lot of value for myself and my law firm partners over the years by obtaining patents that did not ultimately create business value for my clients. I am not proud of this fact but, as a patent attorney, my job was to get a patent for a client if they thought they needed one. My job was not to tell them whether they needed a patent to support their business objectives. And, certainly if my client was willing to spend $10 - $30K for me to obtain a patent (which is the current cost estimated by Mr. McDonough), my assumption was that they had run the numbers and determined that a patent was a good spend for their business.

I now wear a different hat: as an Intellectual Property and Patent Business Strategy consultant (more info here: http://www.jackiehutter.com/), I do not create value for myself by billing clients on an hourly basis. Thus, I am able to look at intellectual property from a fundamentally strategic basis--does building an intellectual property portfolio create long term business value for my client? Unlike traditional patent attorneys, I can create value for myself by telling a client that they do not actually need a patent to maximize their business value. With all due respect to patent attorneys like Mr. McDonough, under the existing model of patent procurement, law firm patent attorneys cannot make a good living by saying "no", even if it is the best business interests of their clients to do so.

This is not to say that patent attorneys are not currently serving their clients' best interests. To the contrary, I have the utmost respect for the work done by law firm patent attorneys. Indeed, as an corporate patent attorney, I hired Mr. McDonough's law firm for high-value patent matters. And, if I had a client with needs for a high-quality patent in certain technology areas today, Mr. McDonough's law firm would be on my short-list of patent providers.

My goal is with this posting is not to criticize his advice, but to add that prior to taking Mr. McDonough's advice of working with a "skilled intellectual-property attorney to develop a plan for building your IP portfolio", you should first determine whether you will create and maximize your company's business value by building a portfolio in the first place. In short, prior to building, you must first decide decide if a proper business foundation exists for doing so.

When might it be in the best business interests of for a company to not get a patent? Some common ones situations are:

• Your product business cycle is very short such that a patent will issue long after your product is finished in the market
• Disclosure would give away critical trade secret information that would empower your competitors
• You have no interest in ever enforcing a patent in court, no matter how strong the claims of your patent

There is no doubt a myriad of additional reasons why a business should not get a patent, and there are as many or more reasons that a company should build a patent portfolio. An intellectual property strategist, such as myself, or a good intellectual property attorney, such as Mr. McDonough, can work with you to work through the various scenarios that may exist in your company's particular situation. Prior to making a decision one way or the other, however, you should be prepared to walk away from the process if you determine that your company's long term value will not be maximized from starting this process. Put another way, what you know about not patenting is just as important to your business success as what you know about patenting.

The Problem with Patent Due Diligence in Mergers and Acquisitions and How to Fix It

As a business or investment professional involved in mergers and acquisitions ("M & A"), are you conducting patent due diligence according to the standard practices of your M & A attorneys and investment bankers? When patents form a significant aspect of the value of the transaction, you are probably getting incorrect advice about how to conduct due diligence. The due diligence process must take into consideration the competitive patent landscape. If competitive patents are not included in your vetting process, you may be significantly overvaluing the target company.

In my many years of intellectual property and patent experience (more info here: http://www.jackiehutter.com/), I have been involved in a number of M & A transactions where patents formed a significant portion of the underlying value of the deal. As the patent specialist on these transactions, I took direction from highly compensated M & A attorneys and investment bankers who were acknowledged by C-level management to be the "real experts" because they completed dozens of deals a year. To this end, we patent specialists were directed to check the following 4 boxes on the patent due diligence checklist:

• Are the patents paid up in the Patent Office?
• Does the seller really own the patents?
• Do at least some of the patent claims cover the seller's products?
• Did the seller's patent attorney make any stupid mistakes that would make the patents difficult to enforce in court?

When these boxes were marked "complete" on the due diligence checklist, the M & A attorneys and investment bankers had effectively "CYA'd" the patent issues and were free from liability relating to patents in the transaction.

I have no doubt that I conducted my patent due diligence duties highly competently and that I, too, had "CYA'd" myself in these transactions. However, it is now evident that the patent aspect of M & A due diligence basically conformed to someone's idea of how not to make stupid mistakes on a transaction involving patents. In truth, I never felt quite comfortable with the "flyover" feel of patent due diligence, but I did not have decision rights to contradict the standard operating procedures of the M & A experts. And, I found out just how incomplete the standard patent due diligence process is when I was left to pick up the pieces of a transaction conducted according to standard M & A procedure.

In that transaction, my client, a large manufacturer, sought to expand its non-commodity product offerings by acquiring "CleanCo", a small manufacturer of a patented consumer product. My client found CleanCo to be a good target for acquisition because CleanCo's product met a strong consumer need and, at that time, commanded a premium price in the market. Due to strong consumer acceptance for its sole product, CleanCo was experiencing tremendous growth in sales and that growth was expected to continue. However, CleanCo owned only a small manufacturing plant and it was having difficulty in meeting the growing needs of the market. CleanCo's venture capital investors were also anxious to cash out after several years of continued funding of the company's somewhat marginal operations. The marriage of my client and CleanCo thus seemed a good match, and the M & A due diligence process got underway.

Due diligence revealed that CleanCo had few assets: the small manufacturing plant, limited but growing sales and distribution and several patents covering the sole CleanCo product. Notwithstanding these apparently minimal assets, CleanCo's asking price was upwards of $150 million. This price could only mean one thing: CleanCo's value could only be in the potential for sales growth of its patented product. In this scenario, the exclusive nature of the CleanCo product was properly understood to be fundamental to the purchase. That is, if someone could knock-off CleanCo's differentiated product, competition would invariably result and ll bets would then be off for the growth and sales projections that formed the basis of the financial models driving the acquisition.

Taking my instructions from the M & A attorney and investment banker leaders in the transaction, I conducted the patent aspects of the due diligence process according to their standard procedures. Everything checked out. CleanCo owned the patents and had kept the fees paid. CleanCo's patent attorney had done a good job on the patents: the CleanCo product was covered well by the patents and there were no obvious legal errors made in obtaining the patents. So, I gave the transaction the thumbs up from the patent perspective. When everything else looked positive, my client became the proud owner of CleanCo and its product.

Fast forward several months . . . . I began to receive frequent calls from people on my client's marketing team focused on the CleanCo product about competitive products that were being seen in the field. Given the fact that more than $150 million was spent on the CleanCo acquisition, these marketing professionals not surprisingly believed that the competitive products must be infringing the CleanCo patents. However, I found that each of these competitive products was a legitimate design-around of the patented CleanCo product. Because these knock-offs were not illegal, my client had no way of getting these competitive products removed from the marketplace using legal action.

As a result of this increasing competition for the CleanCo product, price errosion began to occur. The financial projections that formed the basis of my client's acquisition of CleanCo began to break down. The CleanCo product still sells strongly, but with this unanticipated competition, my client's expected margins are not being made and its investment in CleanCo will take much more time and expensive marketing to pay off. In short, to date, the $150 Million acquisition of CleanCo looks to be a bust.

In hindsight, the competition for the CleanCo product could have been anticipated during the M & A due diligence process. As we found out later, a search of the patent literature would have revealed that many other ways existed to address the consumer need addressed by the CleanCo product. CleanCo's success in the marketplace now appears to be due to first mover advantage, as opposed to any actual technological or cost advantage provided by the product.

If I knew then what I know now, I would have counseled strongly against the expectation that the CleanCo product would command a premium price due to market exclusivity. Rather, I would demonstrate to the M & A team that competition in the CleanCo product was possible and, indeed, highly likely as revealed by the myriad of solutions to the same problem shown in the patent literature. The deal may still have go through, but I believe that the the financial models driving the acquisition would be more reality-based. As a result, my client could have formulated a marketing plan that was grounded in an understanding that competition was not only possible, but also likely. The marketing plan would then have been on the offense, rather than on the defense. And, I know that my client did not expect to be on the defense after spending more than $150 million on the CleanCo acquisition.

Technology Start-up Entrepreneurs and CEO's: If Your Goal is Investment or Acquisition by a Big Company, You are Probably Patenting the Wrong Things

Do you treat your patents as a fence or a tollbooth? If you wish for your start-up technology company to obtain investment from or acquisition by a bigger player, you had better understand the difference.

Most start-up technology company entrepreneurs and CEO's understand that patents can be key to establishing the value of a new business idea. Typically, entrepreneurs and CEO's such as yourself will engage patent attorneys to build an IP portfolio that protects the start-up's technology and products to the fullest extent possible. The motivation for this effort and expense is, of course, to to protect your start-up's idea from use by others. As management of a start-up you may be seeking to build an ongoing business around the patented technology, but often the goal of building a solid patent portfolio is to make your business an attractive target for investment or acquisition by a larger company.

As an intellectual property and business strategist (more info here: http://www.jackiehutter.com/), I believe that such an inwardly focused patenting strategy is a misguided approach for companies that wish to obtain investment from or be acquired by larger companies. Why do I think this? Let me use a simple analogy.

Let's say you have worked diligently for several months of weekends to get your yard perfect--and it is perfect. When you finish the yard, you realize that if someone walks on your lawn, perfection will be lost. So you put an expensive fence around your lawn--and it is the best expensive fence you can buy: a virtual masterpiece. But what good is the fence if no one wants to walk on your lawn anyway? You wasted all that money on the fence.

The great majority of patent seekers (including those at otherwise sophisticated large companies) believe that patents are best used to keep others off their "technology lawns". As such, patents are generally focused inwardly--that is, on the patentee's own technology or products. This is known as "defensive patenting". Defensive patenting is a tried and true patent strategy, but it can be a poor choice for companies that wish to obtain investment from or be acquired by bigger players. Like the example above, if these bigger players have no interest in walking across your technology lawn, your defensive patent fence is a wasted expense.

So how does a technology start-up company such as yours get the attention of these big players? It is quite simple--by putting a patent fence around the big company's technology lawn. When properly formulated and executed, this strategy (which is not surprisingly called "offensive patenting") makes technology or products patented by your company an attractive target for a bigger player. Your company's patent(s) will reduce or prevent the bigger player's free movement in its desired business space. Such a savvy offensive patenting strategy effectively requires the bigger player to ask your start-up company for permission to play on its own technology lawn. Your start-up company can provide that permission in the form of a licensing of the patent(s) at issue or by sale of your company to the bigger player. Either way, the your start-up company is benefiting financially from this smart offensive patenting strategy.

Of course, if offensive patenting was easy, smart entrepreneurs and CEO's such as yourself would already be executing on it in droves. In truth, however, offensive patenting can only be effective against big players through use of expert competitive patent and business intelligence. Such techniques have unfortunately not been readily accessible outside of the large corporate and investor environments.

This is changing, however, as more intellectual property professionals with corporate business experience, such as myself, are entering the consultancy business. I have been able to work with clients using patent filing data analysis to identify where a large company was likely going to be focusing its technology or product efforts in 3-5 years. Together, the clients and I will brainstorm a "next generation" improvement to that technology or product. We then will work with the client's patent attorney to draft, file and prosecute patent applications that are directed toward reducing or preventing the large company's future ability to freely compete in that business or technology space. The objective is to end up with the client owning patent(s) that would be infringed by the large company's future business plans. Rather than change its business plans, the large company will pay a patent "toll" in the form of a license or acquisition of the client.

Admittedly, offensive patenting is a bit like looking into a business crystal ball. However, the information needed to successfully execute on this patent strategy is out there and, when collected and analyzed by the right person, it is actually hiding in plain sight. As discussed in this blog post, experts believe that those who collect and act on available data are more likely to be successful in today's data-driven economy. I believe that smart entrepreneurs and CEO's of startup companies can achieve the investment or acquisition they want for their companies by collecting and analyzing patent filing data to make it necessary for big companies to pay for permission to play in their desired business spaces.

So stop thinking about patents as a fence, but instead as a toll booth. One can usually walk around a fence, but if the toll booth blocks the only road to a big company's business destination, the toll is likely to be paid.