The Case for an IP Management System _final

8/13/2019 The Case for an IP Management System _final

http://slidepdf.com/reader/full/the-case-for-an-ip-management-system-final 1/9

February 2009

Patent Attorneys: The Time Has

Come To Adopt an Electronic IPManagement System

Given the remarkable efficiency and knowledge managementimprovements possible with electronic patent filemanagement systems, there can be no viab le excuse foreither corporate or law firm patent attorneys not to adoptsuch systems.

By: Jackie Hutter, MS, JDIP Strategist and PrincipalThe Hutter Group LLCDecatur, GA 30033web: www.JackieHutter.comblog: www.ipAssetMaximizer.com(Used with permission)



© 2009 Jackie Hutter & The Hutter Group LLC All rights reserved. Used by permission.- 1 -

About Jackie Hutter

Jackie Hutter, MS, JD is a self-described "recovering patent attorney" who has joined the growing

ranks of intellectual property (IP) strategists. Jackie is founder and principal of The Hutter Group

LLC, a leading provider of IP business and investment consultation to forward-thinking

organizations that seek to maximize firm IP value. She has over 13 years’ experience counseling

corporations, universities, entrepreneurs and investment professionals in all facets of IP

protection. In 2009, Jackie was named one of the 250 top IP strategists in the world by

Intellectual Asset Management magazine, the premier periodical in the area of IP strategy. Prior

to founding The Hutter Group, Jackie was Senior Patent Counsel to Georgia-Pacific LLC, where

she had sole responsibility for Dixie® patent matters and, later, the company's chemicals

business. Before joining Georgia-Pacific, Jackie was a shareholder at the prestigious IP firm of

Needle & Rosenberg, PC (now Ballard & Spahr), where she represented multinational

companies, universities and innovators in protecting their IP to create and maximize firm assetvalue.

About Innovation Asset Group

Innovation Asset Group is a leading provider of web-based applications for advanced IP

management. Founded in 2002, IAG develops innovative solutions for the challenges companies

face in managing their intellectual property and maximizing its value. Its flagship product,

Decipher, has quickly gained a national reputation for delivering superior IP asset managementcapabilities.




Patent Attorneys: The Time Has Come

to Adopt an Electronic IP Management System

For many years, vendors of office automation systems expended considerable effort trying toconvince corporate and law firm patent attorneys to adopt paperless file management systems by

touting the time and money savings associated with electronic files over the traditional patent file

system. However, relatively few patent attorneys have done so, instead, remaining loyal to the

traditional three-sided manila patent file folder. Until recently I was one of those patent attorneys.

Now that I have discovered the vast efficiencies and improvements possible with these electronic

systems, the question is why I remained true to this clearly outdated system of maintaining client

patent prosecution records.

In retrospect, I think I found that the heft and

history represented by the partially filled patent

file folder provided a feeling of ongoing

accomplishment, even while I was contestingyet another trivial rejection from a patent

examiner. The need for a tangible sign of my

efforts prevailed over the backaches that I

incurred from carrying multiple patent files to

work on outside of the office. However, after

being faced head-on with the administrative

inefficiencies of the traditional paper-based

patent file management systems, I am now a

convert to the undeniable benefits of electronic

patent file systems.

Put simply, given the remarkable efficiency and knowledge management improvements possible

with electronic patent file management systems, there can be no viable excuse for either

corporate or law firm patent attorneys not to adopt such systems. When viewed in the best light,

patent attorneys who decline to adopt an electronic system are doing their clients and themselves

a disservice. Viewed in the harshest light, these attorneys are unintentionally cheating their

clients out of innovative methods that improve the quality of patent legal service while reducing its

cost.

The Awakening

My awakening to the value of electronic patent file management systems occurred recently while

leading a team of patent prosecution experts for an Intellectual Asset Management (IAM)

enterprise software vendor. For this project, my team conducted a detailed time comparisonbetween a fully electronic patent file management system and a traditional paper-based system.

By assigning times to each of the administrative steps involved in eleven common patent

prosecution tasks, we discovered that use of an electronic patent file management system

markedly reduced the amount of administrative time involved. Specifically, the amount of

administrative time (as opposed to substantive legal effort) required for each task was reduced

from roughly 60 percent to as much as 85 percent, depending on the prosecution matter. These

administrative tasks represented functions such as pulling and moving files from office to office,

Given the remarkable efficiency

and knowledge management

improvements possible withelectronic patent file

management systems, there can

be no viable excuse for either

corporate or law firm patent

attorneys not to adopt such

systems.




uploading, retrieving and saving documents into department computer databases and inefficient

communication between in-house personnel and outside counsel.

Our analysis demonstrated that for a fully staffed corporate patent department (e.g ., docket clerk,

paralegal and attorneys) that files about fifty patent applications and engages outside counsel forpatent preparation and prosecution, adoption of an electronic patent file management system can

save anywhere from $150K to $220K per year (see the Appendix). For a fully staffed corporate

patent department filing a similar number of

patents but which handles patent prosecution

matters primarily in-house, the cost savings

range from $50 to $75K per year. Because the

tasks eliminated by an electronic patent file

management system are repetitive and routine,

these savings are fully scalable to organizations

with higher or lower filing levels.

Savings through Increased Efficiency

Further cost savings will also follow from a corporate patent department’s adoption of an

electronic patent file management system because having the appropriate documents readily at

hand in electronic form greatly increases communication efficiency between patent staff and

internal business clients regarding their patent matters.

For example, while employed as a senior IP attorney at a multinational corporation, I conducted

periodic patent committee meetings with my business and R&D teams. To collect and present

the information necessary for the teams to make informed decisions, the paralegal and

administrative staff were required to spend considerable effort copying, sorting and binding

relevant patent documentation. Moreover, because the information in the thick binders stayed

static, while the relevant patent matters did not, these binders became obsolete as soon as theperiodic meetings ended. The binders therefore needed to be re-created from scratch for every

meeting. Multiply this effort over multiple businesses, each with frequently changing patent

filings, and one can see how much work was required to keep my business and R&D teams up to

date about their patent portfolios.

Had the management of my corporate IP legal department invested in an electronic patent file

management system, countless paralegal hours (and reams of paper) would have been saved by

providing the same information to my organization’s business team for review on their laptop

computers. With an electronic system, our department’s staff could have avoided the repeated

pulling of patent files to copy relevant documents and prepare binders. The time-intensive nature

of patent committee preparation alone would have justified the adoption of an electronic filing

system.

Information to the Right People at the Right Time

A further, perhaps immeasurable, benefit of electronic patent file management results from the

greatly improved access to valuable corporate patent asset information.

Adoption of an electronic patent

file management system can save

anywhere from $150K to $220K

per year.




With traditional, paper-based patent file management systems, patent staff necessarily controls

access to patent information. Those with important business interests in a corporation’s patent

matters—that is, business and R&D teams--must first ask their patent staff for permission to

access such information. For organizations where patents are recognized as valuable corporate

assets, the requirement is like needing to ask your banker for your bank balance. For thoseresponsible for managing corporate assets, such limited access to information is unacceptable.

No More Gatekeepers

An electronic patent file management system is a critical component for those managers seeking

to better capture and protect their intellectual property. When a corporation views its patents as

assets (as opposed to legal instruments);

those responsible for managing those

assets must have ready access to relevant

information. Under traditional paper-based

patent filing systems, patent staff serves as

gatekeepers of the information for the entire

corporation. With an electronic patent file

management system, those with a need-to-

know can be granted access to the patent

information on an as-needed basis. This reduces the workload of the patent staff and improves

the engagement of others in the organization with the patent process.

Managing the Cost of Transition

Given the large cost savings, increased efficiencies, and greatly improved corporate knowledge

management possible with adoption of an electronic patent file management system, there would

seem to be little reason for corporate patent departments to retain the traditional method ofmanaging patent documentation. Of course, the task of scanning active patent files into

electronic form may seem daunting. But there are ways to minimize the entry-level cost.

First, technology makes it easier to go paperless than ever before. Most organizations already

file patent applications and other patent documents electronically. This means that most patent

documents are present in electronic form and do not need to be separately scanned into an

electronic file. In the next several months, the US Patent Office will be introducing electronic

Office Action reporting, to be followed later by electronic reporting for other official documents.

The effective elimination of paper from communications to and from the US Patent Office today

will make it easier for forward-thinking organizations to eliminate paper-based patent file

management systems. When combined with modern document management systems typically in

place at corporate and law firm settings, most organizations will be able to convert to electronic

patent file management systems today for a reasonable price and with minimal effort

To further reduce the entry-level cost, legal managers can select only currently pending

applications for entry into a new electronic patent file management system. Of course, newly

docketed matters should also be made fully electronic from their inception. Issued cases can

later be added to the system if time and resources allow. By taking a measured approach to the

adoption of an electronic patent file management system, the cost of moving from a paper-based

file management system to an all-electronic patent management system can be minimized.

When a corporation views its

patents as assets, those

responsible for managingcorporate assets must be able to

readily access relevant information.




The Role of Outside Counsel

Corporate patent managers should expect their outside counsel to be willing to provide them with

electronic patent-related communications on a low- or no-cost basis. Corporate patent managers

should also be prepared to discuss with their outside counsel where inefficiencies can beremoved from law firm operations and

communications to reduce overall patent

procurement costs. If an outside counsel

wants to charge a client additional fees for

electronic communications, the client should

seriously consider vetting new patent counsel

who is more willing to adopt innovative

solutions. Outside counsel saves money by

communicating electronically with clients,

and it is inexcusable for them not to pass such savings onto their clients.

Conclusion: Now is the Time to Adopt an Electronic IP

Management System

Although we represent technology savvy companies, patent attorneys often are somewhat

resistant to change. This conservative nature could explain why, to date, conversion to electronic

patent file management systems has been slow. With the remarkable efficiencies and

improvements over traditional paper-based patent file management systems more and more

evident, however, there is no reason for patent attorneys not to adopt electronic patent file

management systems today.

Outside counsel saves money by

electronically communicating with

clients, and it is inexcusable for

them not to pass such savings on

to their clients.




Appendix: Explanation of Analysis

Methodology

Eleven common and repetitive prosecution tasks were broken down into constituent tasks. These

11 tasks were selected and analyzed by a team of experienced patent attorneys and paralegals.

The team agreed that the selected tasks were representative of the most prevalent,

administrative-intensive tasks conducted by a corporation having an established patent portfolio.

The tasks analyzed were as follows:

1. Reporting and Docketing of Application Filing;

2. Receipt and Reporting of Filing Receipt;

3. Correction and Reporting of Filing Receipt;

4. Preparation and Filing of IDS;

5. Receipt, Reporting and Response to Restriction Requirement;

6. Receipt and Reporting of Notice of Publication;

7. Receipt, Response and Reporting of Office Action;

8. Receipt and Reporting of Notice of Allowance;

9. Payment of Issue Fee;

10. Filing of Divisional Application; and

11. Reporting of Patent Issuance.

The administrative tasks conducted to complete each task were broken down for a corporate law

department that includes attorney(s), paralegal(s), docketing system and secretary.

Note: The task calculations were based only on administrative-intensive matters. Any

substantive review or effort required to complete a matter would not be readily improved by

adoption of an electronic patent file management system and, as such, calculations were not

included for such matters.

One set of calculations included the steps necessary for a “mirrored” system, that is, where the

corporate law department uses outside counsel as the primary means of completion of patent

prosecution matters. This is a very common system for corporate law departments which wish to

keep internal headcount low, while pursuing a robust patent procurement strategy.

The second set of calculations is for a corporate law department that uses internal corporate

operations as the primary means of completion of patent prosecution matters. This is a common




set up for corporate law departments that handle their own prosecution matters in-house. Such

corporate law departments could be large or small with regard to headcount. Of course, larger

departments will have larger portfolios.

Estimated cost savings are also included. These costs should be considered rough estimatesusing blended hourly rates combining attorney and paralegal work.

For outside counsel, the hourly rates were estimated to be $150 to $200. (This is a conservative

estimate; three years ago, a well-known Atlanta law firm was charging $175 an hour for an

experienced patent paralegal and $250 an hour for a junior attorney.)

For inside counsel, the hourly rates were estimated from published sources. Conservatively, the

blended hourly rate for an in-house patent department should be $100 on the low side and $130

on the high side.

Results

Significantly, adoption of an electronic patent file management system results in an approximately

75 percent reduction in the amount of administrative time associated with the 11 common

prosecution tasks analyzed for this project. The range is 68 to 84 percent for mirrored systems,

and 61 to 81 percent for corporate law departments.

Using the blended hourly rates discussed above, cost savings vary as a function of the specific

task. It is noteworthy that cost savings are highly significant for prosecution tasks requiring high

administrative effort, such as Office Action and Restriction Requirement responses. While

paperless systems provide improvements for all tasks analyzed, benefits for paperless systems

are marked for mirrored systems where the task requires much back and forth effort between

outside counsel and in-house counsel. This means that tasks for which outside counsel must

obtain input and instruction from in-house counsel are vastly more efficient with an electronic

patent management system.

A detailed version of the study, including supporting spreadsheet

calculations, is available from Innovation Asset Group at:

www.innovation-asset.com/savings




Distributed with permission by:

Innovation Asset Group

26055 SW Canyon Creek Rd, Suite 200

Wilsonville, Oregon USA 97070

For more information please call +1 503.783.2370

www.innovation-asset.com

The Innovation Asset Group logos and Decipher are trademarks of Innovation Asset Group, Inc.

All other trademarks are property of their respective owners.

The Case for an IP Management System _final

Documents

Transcript of The Case for an IP Management System _final