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International Developments and Strategy. Laura STORTO, Assistant General Counsel at Genentech S teven Carlson, Managing Partner, Silicon Valley Office at Kasowitz Benson Torres LLP F reddy Thiel, VP of San Francisco Liaison Office at Kilburn & Strode. UPC: States. UPC: k ey questions.
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International Developments and Strategy Laura STORTO, Assistant General Counsel at Genentech Steven Carlson, Managing Partner, Silicon Valley Office at Kasowitz Benson Torres LLP Freddy Thiel, VP of San Francisco Liaison Office at Kilburn & Strode
One fit all approach? Risk aversion: this is the biggest driver, considering the lack of precedents and so many uncertainties. Pharma companies are likely to stay out (opt out) as too risky for them, while software industries want to shape the decisions in their favor. Territorial coverage: obviously, the more countries you need, the more interesting the UP gets. Provided of course that there is a strong enough overlap between these countries and the ones that have ratified the UPC, Budget: the new system was designed to be cost effective for granting and litigating patents across participating states. But opting-out can be costly … Patent strength: with the central revocation, you need to be sure of the solidity of your granted patent with any existing prior art, Patent value: how important is the patent for the owner? This is different than the strength and related to protecting existing products or SEPs. Pharma industry is obviously sensitive to that factor. v
Possible approaches A refine approach requires a knowledge of a portfolio that not all companies have, especially for a massive one. 80/20 rule: most of the value (say 80%) in a patent portfolio may lie within a small fraction (say 20%) of the patents. From a value standpoint, it is safe to opt out the 20% (provided once again that they are clearly identified), Value/strength matrix: both patent value (favoring opt-out) and strength (favoring staying in) are by definition patent specific. With a deep knowledge of the portfolio, one can determine for instance, that low value/weak patents should stay in for obvious budget reasons, and low value/strong patents should be in to shape the decisions.
Utility Models Issued by German Patent Office, China, and elsewhere Registration system (no examination for novelty, inventive step) Low cost For devices, not methods or systems (with some exceptions) 10-year period of protection Can “branch off” from patent application Good way to track developments infringement case In Germany, no “double patenting” problem between utility models and patents (in China, you must elect one or the other) You should obtain prior art report before enforcing In China, more litigations on utility models than full patents Higher likelihood of a stay, potential loss on merits (loser pays!)
Patenting in China: Explosion in Chinese Resident Filings One driver: tax writeoff! (qualify as “high tech” company for lower rate)
Enforcement in China: Empirical Study by Santa Clara Law Source: Brian Love, Christine Helmers & Markus Eberhardt “Patent Litigation in China: Protecting Rights or the Local Economy?” 18 Vanderbilt J. Ent. & Tech. L. (2016)
Special Thanks! Germany: Alexander Harguth Preu Bohlig & Partner Munich www.preubohlig.de/en/ China: Changchun Yuan (Stanford J.D.)Xing Yuan (Northwestern LLM)Broad & Bright Beijing www.broadbright.com