Issue #1-3 | June 30, 2011

IPVW joins the debate at last week’s IP Business Conference

The subject of IP valuation always livens up a conference, and last week’s Intellectual Property Business Conference in San Francisco was no exception. Some of the hot topics:

  • Guessing IP value.  Marquera’s Andrew Ramer stated though there are many different perspectives on IP valuation, the challenge is there is little public data on transactions. Therefore, one can only make guesses about IP’s value, and that’s always context specific.  Note: financial analysts and auditors deal with this very real problem all the time, and rely on one or more of the sources of public comparables such as ktMine.
  • Lack of understanding among business people on how to measure and enhance IP value. Richard Buttrick (RB Intellectual Property) acknowledged IP valuation is vital to SMEs but, “in its current form it is too difficult, complex, unreliable, and expensive.”
  • Buttreck focuses on Scotland’s estimated twenty thousand smaller businesses which have been categorized by the Intangible Asset Centre as “innovative.” The bottom line to Buttrick is messaging:  “IP and intangible asset valuation must be presented in a way SMEs understand.”
  • Better sources of IP value analysis. Dr. Jackie Maguire, CEO of Coller IP Management, encouraged attendees to look to an organization she helped found, International IP Strategists Association (INTIPSA) to identify qualified (competent) valuators and IP strategists.  In the U.S., of course, the American Society of Appraisers, the AICPA, and others certify experts in intangible asset valuation, as well, and international accounting and valuation standards are increasing.
  • Keep an eye on ISO and IVSC standards. David Haigh, CEO, Brand Finance, suggested that IP practitioners keep current on international standards, specifically ISO valuation standard ISO 10668 for brand valuations and International Valuation Standards Council Guidance Note 4 on valuing intangible assets.

For better or worse, the America Invents Act moves closer to law

The America Invents Act (HR 1249) labeled as “patently unfair to inventors” by Rep. Conyers (D-MI) withstood debate on constitutionality this week.  The Senate Bill and House versions of the bill are not identical, but it looks as if the PTO funding compromise worked out in the House will satisfy the Senate and the President will soon see the first patent law reform in sixty years.

And, Sen. Schumer’s (D-NY) Sec. 18, the special interest section designed to give financial institutions an easier path to challenging business methods patents, also was passed by a comfortable margin.

Ron Laurie, Managing Director, Inflexion Point Strategy, added the debate has now “shifted from a legal perspective, namely adjusting the legal scope of patent protection to a more practical one, i.e., fee diversion”.  

“two of the most contentious areas, i.e., apportionment of damages between patented and non-patented product features and denial of injunctive relief for non-practicing entities have gone away because during the pendency of the various reform bills, they have been addressed by the courts.”

Michael Pellegrino, author of BVR’s Guide to IP Valuation, believes that, whatever form the final bill takes, implementation will take some time to test.

IP blogs (and hallway discussions) remain rampant with speculation about the bill’s overall effect on patent processes, small businesses and entrepreneurs-- and whether the 'grace period' and the first to invent vs. first to file issues will ultimately stand legal and political muster.

A new option for getting your staff up to speed on IP value issues

BVR’s newest IP Desktop Learning Center is up and running. The over two-dozen programs range from patent infringement damages to valuing web-based companies, and many of the leading IP valuation experts in the US and overseas are featured.   Many of the training modules are free. 

Righthaven judge takes expanded view of “fair use”

Righthaven buys the rights to copyrighted newspaper articles and then sues infringers.  Their tactics to enforce copyrights and their standing to sue took a different turn with the recent U.S. District Court decision characterizing the posting of a 19-paragraph article from the Las Vegas Review-Journal to a website without the publisher’s permission as “fair use.”

“Righthaven did not present any evidence that the market for the work was harmed by [defendant’s] noncommercial use for the 40 days it appeared on the Website.” There is no genuine issue of material fact that the use of the work was fair and summary judgment is appropriate, ruled Judge Philip Pro. The judge’s interpretation of fair use in this instance may well have been influenced by the legal climate Righthaven has created.

The distinction between fair use and infringement, according to the Copyright Office, is not easily defined. There is no specific number of words, lines, or notes that may be taken without permission:

… the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include — 

  1. the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
  2. the nature of the copyrighted work;
  3. the amount and substantiality of the portion used in relation to the copyrighted     work as a whole; and
  4. the effect of the use upon the potential market for or value of the copyrighted work.

No matter the setbacks and the current climate, Righthaven isn’t going away.  They’ve hired new lead counsel, and they have reportedly renegotiated their agreement with Stephens Media (the IPR owner) to clarify their legal standing.


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