Sunday, June 7, 2020

Big winners of Renewable Energy: IP and Manufacturing

Renewable Energy Patents in 2019
As you look at the companies that are winners in Renewable Energy (RE) you have distinct winners (and losers, especially in the fossil fuel world). But there are entire countries that stand to win as well. Several countries have become exporters of energy, for example, when they produce more regional energy than they can use. I like the image set related to 25 areas/countries that are winners in Renewable Energy (at LoveMoney.com, The world’s greenest nations that are reaping the rewards). Here’s Love/Money’s take on China, both in terms of the technology (Intellectual Property) and the manufacturing/exporting:
Of all patents for renewable energy issued globally, as of 2016 China has 29%. That's more than 150,000 patents, which underlines the focus of China's investment in the industry. So it's not a shock that the country has been dubbed a “renewable energy superpower” in a recent report issued by the Global Commission on the Geopolitics of Energy Transformation. The report argued that, as renewables come to fossil fuels globally, new energy leaders will emerge.
The US had only 100,000 patents (vs 150,000 for China) and Europe had 75,000 in renewables according to the Forbesanalysis in Jan 2019.  Overall, patents in renewables has made impressive progress, even though RE patents are only 1% of all patents (and other high-tech categories like computers are about 6%). Check out the great article at the World Intellectual Property Organization (WIPO) on RenewableEnergy patents by James Nurton. More than half of the RE patents through the Patent Cooperation Treaty (PCT) are in solar. Fuel Cell technology has consistently exceeded Wind in terms of patents. Fuel Cell (using hydrogen) is important because it can function as battery, battery backup, stationary power and portable power. Geothermal is trivial are of RE patent activity. When the RE “international” patents (PCTs) are registered at the national level the first three countries are: Japan, USA, and Germany.
On the manufacturing/exporting side, China has been a huge producer of the world’s renewables (solar, wind and more). Here’s how LoveMoneysummarized Chinese production of RE:
 China is currently the world’s largest exporter of solar panels, wind turbines, batteries and electric vehicles. The country is well-suited to wind power production, and it has an estimated potential capacity of 2,380 gigawatts. What’s more, many Chinese companies are investing in renewables.”
Keep in mind that many things sustainable are lower tech, not higher tech. Much, if not most of sustainable solutions does not require break-through solutions. Using less energy can be very low tech (turning the lights out when out). Driving less (by telework) can be no tech. But in the cases where leading tech can be a major competitive advantage, he owners of IP will win.
Look also at GlobalTrends in Renewable Energy Investment in 2019 by UN Environment Program and Bloomberg. Where is RE coming from? The investment from 2010 through 2019 has been $2.6T with 52% in Solar and $41% in Wind.
And the final question: how do we get to 100% renewable energy in a reasonably short period of time?
#RenewableEnergy #REPatents #IntellectualProperty #IntellZine #SustainZine #WIPO #Sustainability #PCT #REInvestment #Solar #Wind #RE100


Thursday, May 21, 2020

Efficient Infringement 2: Which is Bigger Toll? EI or Patent Troll?

In Part 1 on February 13, “Inequality finds a place in IP where Efficient Infringement Runs Wild,” we emphasized the David vs Goliath nature of patent holding startups trying to get justice against a mega-tech infringer.  Infringement is somehow legally transformed because it is efficient – an odd attempt at rationalizing an illegal action. (Note the new location of our IP Zine and all past blog posts are at www.IntellZine.com.) 
Well, just as we acknowledge that, “hope springs eternal,” as Apple’s appeal in an infringement case was rejected (Bloomberg/LA Times, Feb 24, 2020).  The US Supreme Court refused to consider the tech giant’s attempt to avoid paying upwards of $1B in patent damages to VirnetX Holding Company, a Nevada company with less than $2M in annual revenue.  VirnetX somehow managed to tough it out for a decade trying to get Apple to pay royalties on patents for secure communications technology.
Of the long list of things to fix in IP law, efficient infringment is certainly one of them.  Somehow, infringement cases must be settled far more rapidly than today’s decade long slogging through the mud.  The market disappears in ten years, there is no longer revenue available to fight over.
From The LA Times, “The high court denied Apple’s petition arguing that a $439-million judgement from the first of two cases brought by VirnetX was ‘grossly excessive’ and should be thrown out… A second case not currently before the high court, resulted in a $503-million verdict over the same patents and newer Apple products.” (https://www.latimes.com/business/technology/story/2020-02-24/apple-rebuffed-supreme-court-billion-facetime-patent)  
This ruling was nearly one month after a federal jury in Los Angeles ruled that Apple and Broadcom must pay $1.1B in damages to Caltech for infringing on WiFi patents.  That’s right, California Institute of Technology (http://www.caltech.edu/), the university in Pasadena California! What’s a school gonna do with patent technology anyway? Apple was ordered to pay $837M, Broadcom Inc $270.2M.  “It’s the biggest jury verdict of any kind so far in 2020 and the sixth largest patent verdict of all time, according to Bloomberg data.” (https://www.latimes.com/business/story/2020-01-29/caltech-wins-a-1-1-billion-jury-verdict-against-apple-and-broadcom) Apple’s strategy is based on maintaining the Company’s high profit margin which demands fighting for years in various courts.  Does “efficient infringement” ring a bell here?  (The $838M won by Caltech is about one day of sales and 1.5% of the company’s $55.3B net profit in 2019.)
Apple and Broadcom lose Caltech infringement case

But wait, there’s more. Apple’s appeal to the US Supreme Court did not go well for Apple. On March 13, 2020, the US Supreme Court rejected the opportunity to review the case (originating in Texas, of course). The final settlement that Apple agreed to pay was $454M to VirnetX.  Now down to about half a day of sales and 0.8% of the company’s net profit in 2019. Roughly $1 for each of the 400M devices that VirnetX claims patent infringement. (See here for one discussion of case-closed.)
So, Apple argues, essentially, “efficient infringement”, which we will return to in a second. But VirnetX has been ungraciously referred to as a Patent Troll, a Nevada corporation operating out of a Troll Hole in Texas. Here’s an example of articles during the decade by Zack Epstein in the NY Post: https://nypost.com/2018/04/11/apple-ordered-to-pay-half-a-billion-dollars-in-damages-to-patent-troll/
Patent Trolls. The more derogatory term, but sometimes more accurate, is patent troll; other related terms are patent holding company (PHC), patent assertion entity (PAE), and non-practicing entity (NPE). Wikipedia has a good, but not especially strong, page on Patent Trolls. The advantage of going back to Wikipedia is that it is dynamic and usually is updated perpetually by people. This Apple case is in the article, but not updated for 2020. Anyone can update, so please consider going and improving the article.
There is the dilemma to choose between the lesser of two evils: the toll of the patent troll or the stealth of efficient infringement.  It is hard to support VinnetX, and the tolls of patent trolls.  Our values state that deliberate attempts to extort money on less-than-honorable pretenses cannot be condoned.  We have several blogs posts about Patent Troll and their negative impact on innovation and economic productivity.  On the other hand, efficient infringement is the result of a deliberate – with malice of foresight – corporate strategy.  It is callous and predatory.  It is practiced by companies that are unquestioned technical powers and have major share in their markets.  They have uncommon market power and use it with against rivals.  In particular, these companies prey on start-up entrepreneurs if their new technology is a threat or an opportunity.
Neither party is honorable in any way, but the greater of the evils is efficient infringement.  It would be a more positive impact on innovation if efficient infringement became too expensive by way of damages to risk continued practices.  The courts need to look just at the question of infringement and the issue of market power to make this call.
These efficient infringement courtroom dramas go on and on, and on and on. A decade in this case.  Get the picture?  As one of several high-tech giants that are apparently doing the same, Apple doesn’t anticipate any significant downside.  When served a rare injunction, it just moves up the justice stepladder until, if necessary, it reaches the summit.  To be sure, The Supreme Court’s refusal to hear its appeal must have come as a shock.  But, will this change behavior?  Not likely.
Here is another way to cast a harsh spotlight on efficient infringement.  The House of Representatives should hold hearings when these cases like these reach the public eye.  The CEO of the infringing company must be subpoenaed to testify whether or not efficient infringement is an accepted corporate policy; does the company’s board and CEO approve infringement and willingly will pay damages, eventually.  Today, a CEO can hide behind legions of lawyers. Being forced to testify in person just might, might change strategy.  In addition, Congress should make egregious efficient infringement a felony, Grand Theft – Intellectual Property punishable by 5-7 years in prison and forfeiture of revenues and fines for the key decision maker(s): Chair, CEO and CFO.  When enforced, efficient infringement will become a relic of a lesser past.
Here is an afterthought. It is obvious that corporate lobbying and campaign contributions have removed any possibility of Congressional action to strongly deal with infringement today.  As the economy reopens, many things will change.  It would very much benefit the entrepreneur if the legal system enforced IP laws to protect the new technology inventions we will need.
#Patents #EfficientInfringement #Infringement #PatentTroll #Apple #PAE #NPE

Wednesday, April 1, 2020

Cool Motor that Runs on Air

A lot like a perpetual motor: no fool'n.
As a kid, college really, I was intrigued about the idea of a "perpetual" motor. A motor that ran forever. My idea seemed like it should work, but I had a hard time getting someone to explain why it wouldn't. My idea was based on the flywheel of the single engine Briggs & Stratton where a magnet on the flywheel creates the spark for the ignition on each rotation. My idea was to have magnets that attract the flywheel and a reverse magnet to repel the flywheel once it got past. But I had the problem that the flywheel would get attracted and stuck. So I found something called paramegnetic materials, materials that repel both positive and negative magnetic forces. All I needed, then is to have a thin sheet of paramagnetic material pass between the attracting magnets to let the flywheel move on to the repelling magnet. Perfect, a perpetual motor.
I finally got to talk with a Physics professor at USF who explained my small, but subtle issue with the perpetuity of my motor. When you use a magnet, you loose a magnet. It took energy to magnetize a magnet, so the process of using it will deplete it!
For decades, there have been articles about perpetual motors... But generally they have gone the way of "cold fusion".
Here is a very cool article/technology on a motor that runs on air. Liquefied Nitrogen, actually. Very cool. Literally, about -210 C (or -340 F). So, if the internal combustion motor works on the temperature differential before the ignition of fuel and after ignition, the liquid nitrogen concept works in the same way: from really really cold, to cold. Not nearly the same as the 1,000 times differential from gasoline, but still an effective motor. Effective only once you overcome the problem of things freezing up in the process.
So here's the great Wired article by Nicola Twilley about the inventor Peter Dearman: A One-Time Poultry Farmer Invents the Future of Refrigeration: Mechanical cooling revolutionized the global food supply—and accelerated global warming. Peter Dearman’s liquid air engine could change all that.
The thing that Dearman had to overcome is to bring the temp of the super cold nitrogen up enough that it didn't freeze up the works. (Kind of a reverse of the radiator idea to cool the motor down.)
So the motor works, not especially efficient, but it works.
However, your favorite internal combustion engine is very inefficient. Your car is only about 15% efficient. Diesel turbine motors for electricity are generally about 40% efficient, at best... Unless... Unless you need the excess heat. So if you can use the heat, like hot water on a campus environment, then the combined heat and power (CHP) can be very efficient, maybe up to about 70%.
Imagine if you could use the cool from a liquid nitrogen engine? Say, hypothetically, for refrigerated storage or reefer. (No, not a Jimmy Buffet kind of Reefer!:-) A refrigerated reefer truck.
And, wa la. You have a really great method of efficiently transporting and simultaneously cooling perishable products.
The cryogenic reefer truck seems to be really gaining traction (sorry about the pun) within several food chains.
Very cool!
Dearman says the nitrogen solution will result in a 40% improvement over diesel in terms of greenhouse gases. If is the nitrogen is liquefied (chilled) by renewable energy the improvement compared to diesel moves up to 95%.
Even Cooler!
It also helps to overcome the need for Freon or the replacements for Freon. (Fluorocarbons are a wicked greenhouse gas that blow holes in the ozone layer.)
With 78% of the Earth's atmosphere, nitrogen (N) is readily abundant.
Dearman has several patents related to cryogenics and cryogenic motors.
Interestingly, it would appear that the same Peter (T?) Dearman is also the inventor of respirators and ventilators back in 1990!

Friday, February 14, 2020

Inequality in Efficient Infringement


Inequality Finds a Place in Intellectual Property (IP) where Efficient Infringement Runs Wild
Well established. Well understood. Great wealth creates great inequality. Wealth creates its own space, and maintains exclusivity by keeping others out.
Here, a different view is taken of the inequality condition.  It is a perspective based on corporate wealth – aka corporate greed – masquerading as producing shareowner value.  It is almost axiomatic that when a company scores a major – no, “outstanding” – market success it is compelled to keep the great successes going.  A few outstanding successes include:  Apple’s iPhone, Google’s search engine and ad, Microsoft’s Windows, Ford’s F150, IBM’s Watson, and Coke Cola Company’s Coke.  Companies with successes like these are faced with a profound dilemma: what is the follow-on major winner that produces profits and increased shareowner value?
CEOs of high tech companies, of consumer product companies, of logistics companies, of pharmaceutical companies, of medical device and drug companies have for the last several decades looked to their Intellectual Property assets as a source of answers to the follow-on question.  Research and Development (R&D) leading to new inventions and products is frequently the best source of value-added enhancement to an established offering, and consequently, to the opportunity to create a new market.  This is, however, the cost causing method as R&D is a heavy burden in most companies and while success can be magnificent, failure is also a possibility.
A patent system can be strong or it can be weak.  Unfortunately, the US has gone from strong to weak over the past fifteen years.  In a strong system, there is a “presumption of validity” wherein the patent holder’s rights are protected against infringement: infringers are punished and patents are not subject to constant attack in the courts or the Patent Office (USPTO).  In a strong system, investors are far more likely to invest in a product when it has patent protection.  Most new jobs are created by young companies and the majority need funding – especially if they are disruptive and fast-growing.
A strong patent system is what you should think of as the “play by the rules” method or process of gaining new corporate revenues and market success.  It is conducted on a level playing field.
In contrast, a weak system is basically the opposite.  The courts tend to rule against the patent holder, established competitors ignore the innovator’s patent and engage in what is termed “efficient infringement” utilizing long, drawn out court processes the innovator cannot afford.  Large and well-established high-tech companies have led the strong-to-weak downward slide by lobbying congress and funding campaigns which resulted in the American Invents Act (AIA) of 2011.  “Google spent $18M on lobbyists the year the AIA was passed…Google wanted a weak patent system because it already dominated the search and internet advertising in 2012…with a 67% market share.  Today, (2018), with a weaker patent system firmly in place and no fear of any innovating competition protected by patents, Google’s market share has increased to almost 80%.”  (Shore, M., 2018, Mar 21, How Google and Big Tech Killed the U.S. Patent System, IPwatchdog.com)
“Efficient infringement occurs when a company deliberately chooses to infringe a patent because it is cheaper to fight off a legal challenge from an inventor than it is to license the patent.  This practice is especially harmful to small inventors and innovators and it undermines our broader innovation economy.”  (Save the American Inventor, 2019, May 21, www.SaveTheInventor.com)
In selected circles, this is stated as “efficient infringement is a ‘fiduciary responsibility’ when the costs are less than those in R&D plus product development.”  Huh!  What? Really? Is this saying that Effective Infringement is legal?  It is Stealing!  It is the startup in a garage inventor versus a mega high-tech corporation with very deep pockets taking and using the invention.  The term “infringing” originally applied to a situation where a company accidentally or inadvertently used the same technology (techniques, methods, algorithm, signaling, coding) as the patent what the patent owner claimed (and may have been granted rights to in an issued patent).  In such cases, when the patent owner discovered the infringement, he went to court and got an injunction against the infringer – as cease and desist order.  In most instances, the outcome of follow-on negotiations was that the infringer paid some settlement for past infringement, took a license to the patent, and paid royalties for future sales (usually until the patent expired).
A strong patent system sounds rather quaint in view of today’s infringement-as-a-corporate-strategy where the infringer drags the patent owner through the courts for years until the inventor and his funding are exhausted.  Here is yet another example of wealth inequality where those with money disadvantage those without.  “Try to assert a patent covering the technology being copied and the Gang of Five will simply petition the Patent Trial and Appeal Board (PTAB) dragging the patent through inter partes and deveining it of any useful subject matter if the proceedings are instituted.”  (Brachmann, S., 2017, March 17, How tech’s ruling class stifles innovation with efficient infringement, IPWatchdog.com). Gang of Five refers to Google (Alphabet), Apple, Facebook, Microsoft and Amazon.
Meanwhile, back in Washington, DC, Senator Thom Tillis (R-NC), Chair of the Senate’s Subcommittee on IP, said the Committee would not be able to complete its work on legislation addressing patent eligibility.  “[A]bsent stakeholder consensus, I don’t see a path forward for producing a bill – much less steering it to passage – in this Congress.”  There is no mention of considering strengthening injunctions or treating efficient infringement as the crime it is.  (Borella, M., Feb. 4, 2020, The Zombie Apocalypse of Patent Eligibility Reform and a Possible Escape Route, www.patentdocs.org)
High tech gets to run free without restraint for at least another year.  Hey look, it’s a fiduciary responsibility.

Wednesday, November 20, 2019

Delinkage and the Patent System for Pharma: Trouble Ahead?

While the term “delinkage” has been around since at least 2005, it is not seen or heard very often.  It is the term used in the biomedical field by lawyers and politicians to mean a new way of funding drug R&D such that the patent system could be replaced with the result that a drug monopoly would not exist and drug prices would be significantly lower.  One of the advocates of this is Presidential candidate Bernie Sanders submitted the Medical Innovation Prize Fund as legislation in 2017 that would deny monopoly rights to pharma innovators and create a government fund.
Delinkage is discussed in a Patent Strategy article Delinkage embraced innational elections as alternative to patents (ManagingIP, C. Kilpatrick, Nov. 14, 2019)  The article notes that in 2017 prescription drug spending was $334B and that US national healthcare spending was 17.9% of GDP.  That’s right, the US GDP, which is now at $20T devotes 18% toward healthcare! That’s approaching $4T when all healthcare from all sources are included! The high price of drugs is a big part of the escalation. Anecdotes and reports abound of grossly high prices for a drug and patients who go without needed medication because they cannot afford it.

“We cannot control costs, reduce access barriers and protect and enhance innovation unless we change the way we finance biomedical R&D.  Delinkage is a radical and transformative approach to bring policy coherence to objectives regarding access, innovation and cost control.”  (Knowledge, Ecology International, Delinkage.org)

The fact that this has been floating around since 2005 is proof positive that there is not a lot of momentum behind it.  Fundamental questions abound about how, how to, what if, where would the money to fund multiple projects over multiple years come from?  What if it doesn’t work?  Who pays?  What would the impact on the patent system -- defined in the US Constitution -- be?  There are international implications for patents so how would delinkage work globally?  What happens to the patent system if biomedical is carved out?  Is this a slippery slope, domino effect?
At the risk of getting way out in front of our headlights, here is a possible middle road for consideration.  Keep the existing patent system as is or improved, allow the pharma company to obtain funding (much of it comes from the federal government anyway, including FDA, DARPA, Health and Human Services, etc.).  When the drug is approved for a market, the patent(s) is(are) treated like a Standards patents.  That is, it must be licensed to any and all, with a standard royalty rate, with all appropriate terms and conditions.  Multiple providers should result in reduced prices. 
How do we control costs while protecting innovation? Delinkage might be a possible solution in Pharma.

Non-Sustainable Healthcare Costs Revisited
It is important to note the projection that Hall and Knab identified in a 2012 article related to healthcare costs in the US. Healthcare costs in the US had increased from 6% of GDP a few decades ago. Healthcare costs for several decades had increased by about 10% per year. During the Great Recession, this run-away healthcare costs has reduced to 4% or 5% per year, but still double or triple the rate of inflation. Some of the calming of combined healthcare costs can be attributed to many drug patents expiring, to the great recession, and to Obama Care (especially the early years of ACA).
So, here is the trick question. If health care inflation rises back up to 10% per year, GDP growth is at 2.5% and general inflation is 2%, how many years before combined healthcare costs exceed the US GDP? Obviously, the out-of-control healthcare costs is not sustainable, but this question helps to put it all into focus. Answer: In the described case, it would take less than 24 years before healthcare costs exceeded the US GDP!.  For healthcare to increase to 50% of the US DGP would take only about 14 years.

This out-of-control costs is horribly unacceptable. It is an unsustainable and compounding problem. Plus, the US spends more on healthcare (pre capita) than any other country, and generally has worse results!

So, we are back to the question, what can be done here in addressing this problem? Ignoring the problem, and even adding to it, like the federal deficit, has an ugly way of coming back and biting us in the hinny.

Maybe there’s something to the delinkage approach that can work for (almost) everyone and make a difference in bending the healthcare costs curve?

Just to be clear, we at IPZine love innovation, we fully respect and believe in Intellectual Property, and we like capitalism – especially in places where it is sustainable and doesn’t create unmaintainable results.

Delinkage has interesting possibilities.

Reference
Hall, E. B., & Knab, E. F. (2012, July). Social irresponsibility provides opportunity for the win-win-win of Sustainable Leadership. In C. A. Lentz (Ed.), The refractive thinker: Vol. 7. Social responsibility (pp. 197-220). Las Vegas, NV: The Refractive Thinker® Press. ISBN: 978-0-9840054-2-0

Tuesday, September 24, 2019

Potatoes and Patents


Patents, Potatoes and Pomegranates 
“I remember thinking- there cannot be anything clever in delivering beans…”  That was the reaction of Lucy Wojcik in 2014 being interviewed for the job of IP attorney at Ocado, an online supermarket company in the United Kingdom.
It does furrow eyebrows when considering the part, if any, IP would play in a company that grows vegetables and fruits and then distributes them as meals, but now Ms Wojcik has a decidedly different view, https://patentstrategy.managingip.com/Articles/110?from=daily.  As she came to find out even in the supermarket business, “… as soon as you have problems that need solutions and engineers, you are generating IP.”
The Ocado and its emphasis on IP serves as today’s model of how to maintain a competitive presence today and tomorrow.  With very few exceptions, a company today needs a strong R&D/IP culture to survive.  It must be an integral of the conduct of business, a primary consideration in company strategic planning.  It should be the source of new, competitive products and services as well as the mechanisms for protecting those products from competitive inroads.  A comprehensive tour de force for the “how to” is Perpetual Innovation™ A guide to Strategic Planning. Patent Commercialization and Enduring Competitive Advantage by Hall & Hinkelman available at Amazon and Lulu.
Perpetual innovation™ Patent Guide & Patent Primer: http://www.lulu.com/spotlight/SBPlan

Wednesday, September 4, 2019

Yeti, cool ideas and lots of patents

Yeti has a rather cool new cooler out, the Hopper(r) M30 uses a magnetic seal. Although it might be a bit gimmicky, it should work much better than the heavy (klunky) zippers. They say that it is nearly leak proof. GearJunky does a nice review of the M30. For $299.99 at high quality sporting goods stores like Dicks, you too can have one.

Yeti is a $2.5B market cap company, up about 70% from its IPO. It is hard to maintain a premium brand in an era of knock-offs. But Yeti is and continues to do so.  I got in on the IPO, sold half at a good profit, and held on through the couple rough patches for a consumer product like this. They came out early for better (sane-er?) gun controls, and had NRA members making a spectacle (viral videos) of throwing Yeti coolers in the dump. (That was an ugly couple days for the stock.)

In Sept. 2019, Yeti has just introduced a major line of coolers for "everyday bags" adventures and the Urban crawler: Crossroads(tm) backpacks and totes! Press release at Reuters. Big purse or a backpack. Not sure if it will replace your Prada, but it should keep your beer in the office cold. (Maybe that's one reason why Yeti stock popped about 8% on 9/4.)

"We already offer premium bags designed to excel in harsh outdoor conditions. But even the world's most extreme adventurers need something durable and comfortable to keep them organized during their daily commute," says YETI CEO, Matt Reintjes. "Our Crossroads bags offer YETI's signature durability and performance, but are designed for your everyday adventure." 

Yeti is a premium brand with a premium price, and everybody likes to do knock offs. Trademarks are helpful. A big patent portfolio is one way to keep the knock-offs at bay. Here's Yeti's patent page by product.

PatentBuddy summarizes Yeti patents:
YETI COOLERS LLC AUSTIN, TX
257 active patents, with 34 applications.
Updated 9/5/2019.