The Economic Impact of Codifying Fintiv

As part of the efforts of Unified Edge, Korok Ray, an Associate Professor at the Mays Business School of Texas A&M University and Research Director of the Mays Innovation Research Center, published a paper on the economic impact of codifying “Fintiv”. Read the abstract below and follow the link to download the paper.

Abstract

The term “Fintiv” refers to a threshold, procedural set of factors the Patent Trial and Appeal Board (PTAB) of the U.S. Patent and Trademark Office (USPTO) currently uses to decide which patents will be reviewed by the PTAB. Based on the Apple v. Fintiv case, the Fintiv factors refer to the PTAB’s ability to launch a review of a patent that is also at issue in a parallel infringement case in a different forum (e.g., federal court or the U.S. International Trade Commission). Under Fintiv, the PTAB can elect not to conduct an inter partes review (IPR) or post-grant review (PGR) of the patent, thereby deferring to the district courts to handle validity of the patent(s)-at-issue instead. Currently, the PTAB is considering whether to make Fintiv permanent. This paper argues and shows that making Fintiv permanent could generate a direct economic cost of at least $283 million. Based on the data used, as explained further below, and because it is difficult to quantify the indirect costs, this estimate is likely an underestimate of the rule’s true economic cost.

Find the complete report HERE.

The USPTO Needs Your Input Now - Help Fight NPEs

You can help support our economy, reduce wasteful NPE litigation, and stop the assertion of bad patents. All it takes is a few minutes of your time.  

The USPTO has issued a set of proposed rules, nearly all of which will make it harder for everyone, including Unified, to challenge bad patents. Examples include the invalid Shipping and Transit or Sportbrain patents, which collectively were asserted over 400 times and sparked over a thousand demand letters. Many of the new proposed rules are outside of the USPTO’s authority and plainly contradict statutes that Congress put in place and the Courts have opined on.

By placing a heavy thumb on the scale in favor of NPEs, these proposals will raise already-high litigation costs for all parties, weaken the Patent Trial and Appeals Board, and seek to stop Unified from challenging particularly bad, invalid patents. Patents that slipped through the system and should have never been issued in the first place will be asserted against American companies, particularly medium and small-sized businesses. Studies show that even a handful of these proposals would cost many hundreds of millions of dollars.   

The USPTO has asked for a limited window in which to get the public’s input, so time is of the essence. Please let the USPTO know you want a fair and open system for all, where anyone can petition the government for review of an invalid patent. That is what Congress put in place, and what the Article III Courts have blessed. This administrative agency should not be trying to overrule them. 

You can take action by selecting the green box, titled “Submit a formal comment” (here), and sharing your thoughts, however brief. All comments are due by June 20, 2023, 11:59 PM EST. It is of critical importance that the USPTO hears from real stakeholders like you.

The Adoption and Benefits of Royalty-Free Licensing

As part of the efforts of Unified Edge, John Jarosz and his team of economists at the Analysis Group have published a paper on the benefits of royalty-free licensing. Read the abstract below and follow the link to download the paper.

Abstract

Much licensing of patented technology is royalty-bearing, allowing innovators to be compensated for their investments in researching, developing, and then in commercializing the resulting products.

However, over the last couple of decades, standards-based technologies have expanded, in part, due to the increased need for device interoperability, communication, and replacement. Though some of the licensing of patents covering such technologies bears royalties, royalty-free licensing of standards-based technology has grown increasingly common. Indeed, perhaps only a small percentage of today’s widely adopted standards-based technologies are subject to royalty payments. Furthermore, there has been a proliferation of non-standards-based patented technologies and protocols that companies offer on a royalty-free basis (e.g., Adobe PDF and Thunderbolt, discussed further below).

The advantages of royalty-free licensing of technology are obvious for competition broadly and can be numerous for both consumers and companies, specifically, those who benefit from, inter alia, reduced costs and lowered barriers to market entry. But royalty-free licensing can be appealing to innovators as well, as it can result in faster adoption, increased usage, and further innovations that incorporate the standardized technologies. Using some well-known examples, this paper examines the widespread adoption of, motivations behind, and benefits associated with royalty-free licensing in standards-based settings, and even, in some cases, outside of a formal standard-setting organization (“SSO”). Though royalty-free licensing has many perceived and actual advantages, it is not the optimal route for all technology licensing. It can be and is, of course, optimal in many settings.

Find the complete report HERE.

Unified Patents Launches IETF OPEN

Unified Patents is pleased to announce OPEN’s IETF Standard Submission Portal. The Internet Engineering Task Force (IETF) is largely responsible for how the internet operates and is vitally important to how various devices use the internet. Common areas of focus for the IETF include Internet Protocols, APIs, and Routing, (i.e. architecture and backbone of how the internet works). Users can now search all the submissions related to IETF via full-text or by author and source. The submission portal includes over 86,000 documents that are full-text searchable.

The internet standards process includes proposing specifications, developing standards based on agreed-upon specifications, coordinating independent testing and revising proposals based on testing results.

In addition to the ability to search, Portal provides high-level analytics to provide transparency and clarity on submissions to better improve the Internet. Users have the availability to understand the landscape clearly based on the search criteria.

Tracking Innovation: Using Unified’s Portfolio Velocity Tool

Unified’s Portal has added a new component to its Portfolio analysis tab that allows companies to be compared in terms of accelerated or decelerated innovation based on CPC codes.

Innovation Velocity uses two key metrics: ▲ Velocity - the total sum of patents per class code within the last 10 years; and ▲% Velocity - the percentage of change over a given time period. The Innovation Velocity formula is:

The Final Number of Patents specifically looks at years 2017-2022, while the Initial Number of Patents looks at years 2012-2022. By using these parameters, the tool is able to overcome the natural “dark period” of time within the U.S. patenting process. The dark period refers to the 18 months from which an application is filed to the day it is published. These 18 months make it extremely difficult to understand a portfolio’s trajectory because naturally there will be a decline in publicly available application/patent information. By using the formula, the most recent years are aggregated together to get a holistic view of the number of patents over a given time period and measured against the previous years. This provides a glimpse to either the growth or the decline in a specific classification code.

As an example, we can compare Bank of America’s portfolio against JP Morgan Chase in terms of patenting trends, The Innovation Velocity tool allows users to see the general patenting trends for the top CPC codes, with the total being aggregated. Included are the CPC, ▲ Velocity, ▲% Velocity and a ten year graph to show the general trend.

Users then can see the number of patents granted, within each CPC, on the timeline over a specific time period. The patent count is hyperlinked back to Portal’s Patent Search where more analysis could be done on the set of patents.

Users can also view the macro trends of a company, but looking at all the top CPCs and see an aggregate total for the entire company.

Since CPCs tend to be generic and broad, Unified’s Portal provides the same analysis on the CPC Subclass.

Innovation Velocity not only helps companies understand their specific portfolio, but this tool allows users to compare their portfolio with others to understand both the macro and micro trends of their patenting strategy.