Table of Contents

Manage IP costs with technical disclosures

Patents are rapidly evolving as the business tool of choice (1). Patent filings are increasing at a furious pace. Although it appears from recent media attention that the filings related to emerging technologies and business methods are the primary cause for the dramatic increase, the chemical industry is not immune to the patent landgrab. Between 1995 and 1999, the rate of increase in new U.S. chemical patents outpaced gross domestic product (GDP) growth by 85% (Figure 1 below) (2, 3). All this activity is putting an extraordinary burden not only on patent offices, which are forced to absorb this explosive growth, but on corporations that have to bear the costs of filing, prosecution, and maintenance, which run about $250,000 for the life of a single patent (4).

Figure 1. The rate of increase in new U.S. chemical patents outpaced U.S. GDP growth by 85% between 1995 and 1999, with some chemical classes showing even faster growth. For example, class 435 (chemistry: molecular biology and microbiology) increased by 171% (2).

Instead of patenting all inventions, savvy intellectual property (IP) managers seek to patent only the broadest or most relevant inventions. The question then arises about what to do with incremental or noncore inventions. If a company does not patent them, a competitor might; the competitor could then prevent the company from using its own inventions in its products and services. One solution is to publish technical disclosures describing inventions, which can serve as prior art to prevent related patents from being granted in the future.

Published technical disclosures used in conjunction with patents cost-effectively strengthen an IP portfolio and protect a company’s freedom to practice an invention. Companies with sophisticated IP strategies have long recognized the value of published technical disclosures. For example, more than 48,000 references are made in U.S. patents to IBM’s disclosures published in its Technical Disclosure Bulletin.

Over the years, IP managers have used a variety of technical disclosure tactics. In this first article of a two-part series, we review several important considerations for incorporating published technical disclosures into an IP strategy, and we discuss some common disclosure tactics, with emphasis on the chemical industry. In the second article, we will discuss some of the advanced technical disclosure tactics that can be applied in the management of chemical innovations.

Published technical disclosures vs other publications
Published technical disclosures are unique in that they are not subjected to peer or editorial review. Therefore the author has full control in determining the content of a technical disclosure. The tradeoff is that the benefits of peer review and the editorial processes are absent, and there is no mechanism for quality control and assurance.

Disclosures can be published anonymously, facilitating tactics that might not otherwise be prudent. For example, publishing anonymously prevents your competitors from associating your publication with your company in the course of their competitive intelligence efforts, which is generally desirable, and can be particularly important if your company is conducting work in new strategic directions that have not been announced yet. Other examples, which we discuss in the second article, are advanced tactics that limit patenting by customers and suppliers. These tactics must be used anonymously to avoid straining important business relationships. Although patents stake a claim to an invention, technical disclosures place inventions into the public domain without staking claims to the inventions. As long as one can prove that the invention was in the public domain, there is no need to prove authorship or ownership of a technical disclosure in order for it to serve as prior art.

Another advantage of the published technical disclosure is that it can be published rapidly, in contrast to peer-reviewed publications, which can take weeks to a year or more before going to press and becoming publicly accessible. In matters pertaining to publication of inventions and patentable technology, every day counts because the outcome of patent prosecution and litigation often comes down to differences of days or months.

The formats of published technical disclosures vary significantly, depending on the goals of the author and the complexity of the underlying technology. Disclosures vary in page length; they are typically one or two pages. Often a disclosure contains only a title, abstract, and description of the invention.

Legal considerations
Many published technical disclosures are targeted at impacting the future patentability by others. Therefore, a brief overview of relevant patent law is warranted.

Patent law under Title 35 U.S. Code, section 102, states (in relevant part) that a person shall not be entitled to a patent if the invention was described in a printed publication in this or a foreign country

• before the invention thereof by the applicant for patent, or
• more than one year prior to the date of the application for patent in the United States.

Section 103 of Title 35 states (in relevant part) that a patent may not be obtained even though the invention is not identically disclosed or described as set forth in section 102, if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains. In addition, an invention must be useful to be patentable.

Thus a published technical disclosure may affect future patentability by either anticipating the exact invention (section 102) or by rendering the invention obvious (section 103).

It is important to point out that for a publication to anticipate an invention under section 102, the publication must describe the invention in sufficient detail to enable a person having ordinary skill in the art to carry out the invention without undue experimentation. For chemical disclosures, this generally means including relevant synthetic procedures, formulas, equations, experimental conditions, compositions (for mixtures), or references to these enabling items.

In contrast, enablement is not required for a reference to be used under section 103 because a patent examiner can combine multiple references to demonstrate obviousness. This leads to many brief disclosures—a paragraph or two—describing a new idea or concept.

Therefore, although a detailed and enabled disclosure has the highest probability of preventing a competitor’s patent, even a brief nonenabled disclosure may be sufficient. The benefit of enablement (the possibility for anticipation under section 102) must be weighed against the disadvantages (the extra effort required to prepare the disclosure and the greater level of detail disclosed to competitors).

Finally, it should be noted that, as with a patent, an invention described in a published technical disclosure need not have been carried out (reduced to practice) in order to be effective as prior art.

Where to publish technical disclosures
Kenneth Mason Publishing (Westbourne, Hampshire, U.K.) maintains a print-only journal, Research Disclosure, for published technical disclosures. Manuscripts are accepted for publication at a cost of $95 per page. Anonymous publications are accepted, and there is no peer review or editorial process. The lag time between submission of the manuscript and publication can be as much as 7 weeks.

IP.com Inc. (West Henrietta, NY) maintains an Internet-based service, the IP.com Disclosure Database, for published technical disclosures. Manuscripts in a variety of electronic formats can be published via an easy-to-use Internet interface for $109 per document. Anonymous publications are accepted, and there is no peer review or editorial process. The manuscript is publicly available and searchable via the Internet within 1–2 min after it is submitted. Digital fingerprint and notarization technology are used to ensure that the publication date and authenticity are verifiable at any time in the future. In addition, the contents of the Disclosure Database are published monthly in The IP.com Journal, a combination print and CD publication.

Traditional defensive technical disclosure tactics
A byproduct of the patent landgrab is that patent offices often grant patents for inventions that are already in the public domain because patent examiners are overloaded and have limited time to search prior art. Even when an invention is in the public domain, if examiners can’t find it easily, it may as well not exist.

Many basic disclosure tactics are aimed at making sure that the technology that is already in the public domain is in a place where it can be easily located by patent examiners to prevent competitive patenting. Other basic tactics aim to put new inventions into the public domain to prevent competitive patenting.

Noncore inventions. Given the high cost of obtaining and maintaining patents, companies may not wish to patent all of their noncore inventions, yet they may wish to prevent other companies from obtaining patents on them. Placing noncore inventions into the public domain using technical disclosures will help prevent patents from being issued, thereby preserving a company’s right to make, use, and sell its own innovation if the business direction changes.

For example, a pharmaceutical researcher developed a library of 240 promising small-molecule drug candidates. After high-throughput screening, three members of the library exhibited sufficient activity to warrant costly, more detailed efficacy evaluations. Composition-of-matter patent applications were prepared covering the three most promising candidates. The company’s IP management team classified the other 237 candidates as noncore inventions. Knowing that the high-throughput screening method used to narrow the field was less than perfect, the researcher, in consultation with the IP management team, decided to publish the remaining 237 noncore candidates in technical disclosures to ensure that the company’s freedom to use those candidates was retained in the event that they later were found to be efficacious in this or other applications.

Conference tactic. A chemist is scheduled to present a paper describing a novel economical asymmetric epoxidation reaction at “a special session on asymmetric epoxidations” at a major conference. Many leaders in the field from university and industrial R&D laboratories, including some colleagues with a reputation for “pushing the envelope” on aggressive patenting, will attend the session.

Although the chemist has already submitted a paper for publication and filed a related patent application, it will be more than a year before the patent application will be available to the public and the world’s patent examiners. The examiners don’t normally include the journal or conference proceedings in their searches. The chemist has learned the hard way that it is prohibitively expensive to challenge “unjustified” patents in court once they have been issued. Therefore, he is worried that others may obtain a patent on his invention. Yet the show must go on, because his company is under pressure to communicate its success to customers and the investment community.

The solution to this predicament is to make it a practice to publish all conference presentations as technical disclosures, either in full form or distilled down to contain only the key information. The disclosures can be published simultaneously with or prior to the conference. For a small cost, an inventor will gain the peace of mind of knowing that the disclosures can be located by examiners to prevent others from patenting the inventions or related extensions.

Finders of the lost art. A research group has just discovered a useful silane monomer, which it believes to be novel and for which the group hopes to obtain a composition-of-matter patent. Much to their disappointment, their literature and prior art search reveals a Russian abstract from 1982 that appears to describe similar technology. After obtaining an English translation of the entire document, it becomes clear that this technology cannot be patented because the Russian document discloses synthesis and characterization of the monomer. The irony is that, in all likelihood, these researchers could have obtained a patent if they had not discovered this prior art because examiners in most countries would not have found the Russian article. However, inventors are bound by law to disclose prior art of which they are aware when filing a patent application.

After careful internal review, the group decides that the technology will be pursued in their commercial application, even though they will not be able to patent it. The question arises: What if the researchers’ competitor is not as diligent in his prior art search and obtains a patent after the researchers’ company is close to commercializing this technology?

The solution to this and many related situations is to publish old prior art in technical disclosures. The fact that prior art is in the public domain does not mean that an examiner can find it during a prior art search. A hidden reference is of absolutely no value in preventing a bad patent from being issued. Rather than risk the time and expense to fight such a patent, a technical disclosure of old prior art will bring the old prior art to the attention of examiners. If copyright is a concern, a summary of the prior art reference can be published in the disclosure with a reference to the original. Publishing translations, such as the Russian document in this example, is an ideal use of this tactic.

Early publication of patent applications. Patent applications are held in confidence in the world’s patent offices for 18 months before publication. During this time, there is no way for examiners to find an application that is in another patent office when similar filings appear in the meantime. A technical disclosure subsequent to a patent application will immediately put patent applications in front of patent examiners worldwide. Furthermore, competitors will be discouraged from filing similar patent applications when they see that there is published prior art.

Defense against the picket fence. A well-known tactic to devalue a competitor’s patent is to create a “picket fence” around it. Using this tactic, a competitor attempts to surround the pioneering patent with many patents covering incremental innovations, thereby hindering freedom to operate or freedom to advance the technology along logical trajectories.

Publishing technical disclosures provides the most cost-effective protection against the picket fence. By publishing technical disclosures surrounding a core patent, a company protects the value of the core patent by rendering the surrounding technology unpatentable. For example, a company that owns a composition-of-matter patent on a paint additive aggressively publishes technical disclosures whenever it becomes aware of a new application for the additive. Otherwise the company would soon find that its customers have patented many uses of the additive. Other customers would then be forced to find alternative additives for their own use, causing a decline in market share for the company’s additive.

Incremental improvements. Incremental improvements around core patents make good targets for picket fencers. Technical disclosures make it possible to avoid the expense of patenting incremental noncore inventions. For example, a company (Company X) has a pioneering patent covering a low-cost process comprising steps A–D for making a chemical commodity. After the original patent was issued, Company X discovered that it could get a purer product by adding an additional step E at the end. Any competitor that uses A–E would infringe Company X’s patent for A–D, because A–E contains steps A–D. But if a competitor patents A–E, Company X could not use A–E (neither Company X nor the competitor would be free to use A–E). Therefore, Company X does not really need patent protection for A–E. Instead, it needs to prevent a competitor from patenting it, so that it preserves its freedom to practice the improved process A–E. Putting this and other improvements into the public domain prohibits others from patenting and using the improved processes. More importantly, it prevents Company X from having a picket fence built around its core patent; such picket fences often force cross-licensing deals with competitors.

Rounding out your IP strategies
In this era of heightened focus on efficient use of corporate resources and creation of shareholder value, it is unrealistic and unnecessary to patent all inventions. Nor should companies measure the performance of their R&D organizations or personnel by the number of patents they generate, without first understanding the value of those patents. Only strategically important patents should be pursued, with technical disclosures used judiciously to round out the IP strategy. The technical disclosure considerations and tactics reviewed here provide a foundation for those interested in implementing or augmenting a technical disclosure program for management of chemical innovation. In our next article, we will present advanced technical disclosure tactics.

References

1. Rivette, K. G.; Kline, D. Rembrandts in the Attic; Harvard Business School Press: Boston, MA, 2000.
2. Calculated from data obtained from U.S. Patent and Trademark Office, Information Products Division, Technology Assessment and Forecast Branch (www.uspto.gov/web/offices/ac/ido/oeip/taf/stchem.pdf.)
3. GDP and related data from the national accounts programs of the U.S. Department of Commerce’s Bureau of Economic Analysis (www.bea.gov/.)
4. Poynder, R.; Goslinger P.; Carter, M. Hidden Value: How Intellectual Property Know-How Can Make or Break Your Business; Derwent: London, 1999.

Jeffrey M. Cogen is product manager at IP.com Inc. (150 Lucius Gordon Dr., West Henrietta, NY 14586; jcogen@ip.com). He has a B.A. degree in chemistry from Cornell University and a Ph.D. in chemistry from the University of California, Berkeley. His experience includes 10 years of industrial R&D project management. He holds 8 patents and 10 pending patents and is the author of many research papers and technical disclosures.

Thomas J. Colson is chief executive officer of IP.com Inc. He received a B.A. degree from Canisius College in political science (minor in chemistry) and a J.D. from the State University of New York at Buffalo. His previous experience includes serving as vice president and general manager of the Intellectual Asset Management division of Manning & Napier Information Services, a registered patent attorney with seven years as a civil trial lawyer specializing in patent litigation, general counsel to the Dines Industrial Group, and trial counsel to the firm of Sommer, Oliverio & Sommer.