five strategies to monetize your patent portfolio on a small client budget - by michael shimokaji
TRANSCRIPT
FIVE STRATEGIES TO MONETIZE YOUR PATENT PORTFOLIO ON
A SMALL CLIENT BUDGET
Michael A. Shimokaji
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OVERVIEW
• PORTFOLIO ASSESSMENT
• LICENSING OR SALE – PATENT BROKER
• LICENSING OR SALE – DO IT YOURSELF
• LITIGATION – NONPRACTICING ENTITY
• LITIGATION – DO IT YOURSELF
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PORTFOLIO ASSESSMENT
• What’s In Your Portfolio
Group patents by technology
For each group –
How many US patents/applications
How many foreign patents/applications
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PORTFOLIO ASSESSMENT
• Who Are Your Primary Competitors
For each group of your patents –
Who are the primary US competitors
Who are the primary foreign competitors
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PORTFOLIO ASSESSMENT
• Who Are Your Primary Competitors
Factors to consider –
Number of patents in technology area
Number of forward citations of your patents
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PORTFOLIO ASSESSMENT
• What is the Market Size
For each technology group –
Number of product units being sold by all
Gross revenue being generated by all
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PORTFOLIO ASSESSMENT
• Who/What is Infringing Your Portfolio
Claim charts are needed –
Prepared by a patent professional, not client
Neutral presentation, not as an advocate
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PORTFOLIO ASSESSMENT
• If No Infringement Found
Next strategy steps will be difficult to achieve
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LICENSING OR SALEPATENT BROKER
• What is a Patent Broker
Assist buyers and sellers of patent portfolios
Some only represent sellers
Most are NOT interested in licensing
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LICENSING OR SALEPATENT BROKER
• What Value Does a Patent Broker Provide
Access to known buyers and sellers
Marketing and sales infrastructure
Marketing and sales expertise
Eliminates your time commitment
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LICENSING OR SALEPATENT BROKER
• What Do Patent Brokers Charge
Most charge a success fee based on a percentage of the transaction price
Percentages vary – in the range of 15% to 35%
Out of pocket costs (e.g., marketing) are not extra
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LICENSING OR SALEPATENT BROKER
• What Do Patent Brokers Charge
Some charge an up front fee
Fees vary – up to around $25K
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LICENSING OR SALEPATENT BROKER
• What Do Patent Brokers Look For
Evidence of use/infringement
Standard essential patents
Large revenue market
High tech portfolios
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LICENSING OR SALEDO IT YOURSELF
• Why Do It Yourself
Save money on the broker fee
Your portfolio is not what a broker seeks
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LICENSING OR SALEDO IT YOURSELF
• How To Do It Yourself
Create marketing package – why a buyer should buy
Why should a buyer buy your portfolio
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LICENSING OR SALEDO IT YOURSELF
• How To Do It Yourself
Identify potential buyers
Your competitors
Patentees who have cited your patents
Non-practicing entities
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LICENSING OR SALEDO IT YOURSELF
• How To Do It Yourself
Establish a sales price
Comparable sales
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LICENSING OR SALEDO IT YOURSELF
• How To Do It Yourself
Establish a sales mechanism
Offer at an established price
Take all bids
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LICENSING OR SALEDO IT YOURSELF
• How To Do It Yourself
Negotiate and close
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LITIGATIONNON-PRACTICING ENTITY
• What is a Non-Practicing Entity
They come in many forms
Some aggregate patents for defensive purposes
Others are combinations of operating companies
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LITIGATIONNON-PRACTICING ENTITY
• What Value Does an NPE Provide
Similar to patent brokers
Saves you time
Saves you up front out of pocket costs
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LITIGATIONNON-PRACTICING ENTITY
• What Value Does an NPE Provide
Similar to patent brokers
Provides insulation against counterclaims
Provides litigation management expertise
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LITIGATIONNON-PRACTICING ENTITY
• What Do NPEs Charge
Varies – But Often a Percentage of Net Recovery
Percentage may be 40% or more
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LITIGATIONNON-PRACTICING ENTITY
• What Do NPEs Look For
Same as patent brokers
But with greater emphasis on infringement
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LITIGATIONDO IT YOURSELF
• Why Do It Yourself
Save money on the NPE fee
Your portfolio is not what an NPE seeks
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LITIGATIONDO IT YOURSELF
• How To Do It Yourself
Create a marketing package – FOR ATTORNEYS
Emphasis on claim charts
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LITIGATIONDO IT YOURSELF
• How To Do It Yourself
You want to “sell” your case to a contingency law firm
Make the law firm’s due diligence easy
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LITIGATIONDO IT YOURSELF
• How To Do It Yourself
Identify potential law firms
Internet search
Referrals from your patent prosecution counsel
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LITIGATIONDO IT YOURSELF
• How To Do It Yourself
“Sales” mechanism
Smile and dial
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LITIGATIONDO IT YOURSELF
• How To Do It Yourself
Concurrent licensing and litigation
Some infringers resolved through licensing
Other infringers resolved through litigation
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QUESTIONS
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