Prior to the 1990s, it was acceptable for business and technical professionals not to fully understand the workings of intellectual property (IP). In fact, IP was largely viewed as an isolated topic for legal or research and development departments to handle. In turn, many innovative and high-tech firms didn’t even file for patents. However, due to the “patent wars,” this has changed.

Since the beginning of the new millennium, corporations around the world have filed for hundreds, and even thousands of patents annually. The purpose: to develop a patent arsenal. Several tipping points reveal why.

First, in the 1980s Texas Instruments accumulated an estimated $4 billion through an intensive patent licensing and litigation campaign. At approximately the same time, IBM topped the billion dollar mark from patent licensing and litigation revenue. This soon led to battles of who owned what.

As a result, patent wars quickly spread throughout the software industry, and ultimately, throughout all major industries. In turn, many CEOs were asking their patent counsel how they could capture greater patent licensing revenue.

Second, the internet explosion, which caused another tipping point, further advanced all IP litigation. Due to the world wide web, corporate products from Indonesia to Indiana could almost certainly be monitored online. In turn, IP piracy was much more easily identified. Since the internet makes IP infringement virtually transparent, a business in China illegally using an American firm’s federally registered trademark can easily be spotted from thousands of miles away. And, as a result, copyright lawsuits are now commonplace and easily detected in a simple Google search.

Today, companies can obtain licensing profits from patents, trademarks and copyrights in ways never achieved before. Consequently, it’s common to see high profile IP litigation being waged by companies like Apple, Samsung, Google/Motorola, and Microsoft in courtrooms from Bangalore to Boston. In turn, the so-called patent wars have forced IP owners to become IP savvy.

To better understand, identify, and grasp the value of IP, business people at all management levels are being better trained on the subject. Thomas Colson, CEO of, a firm that trains executives on how to recognize and profit from IP, said “the Internet, globalization, a greater understanding of IP, and the rapid rise in IP values has forced business leaders to understand the ground rules of the patent wars like never before.”

Who in your firm should understand IP? Most employees, including:

  • Product and research and development (R&D) managers — they often deal with issues of infringement and licensing,
  • Purchasing personnel — they may be signing away valuable IP rights when a contract is silent on IP ownership,
  • Planners — a business plan that does not include IP issues may be a poor business plan,
  • Professionals engaged in mergers and acquisitions — the buying and selling of companies often involves divesting divisions that possess IP that could have more value than most other assets, and
  • Sales and marketing executives — those that are in a position to spot IP value early in the marketplace.

For these and many other reasons, companies need to educate virtually all their employees on IP. And this does not require the creation of experts within an organization. In fact, many companies already have the experts — they have patent departments and utilize law firms that provide sound IP counsel.

In today’s global economy, it is essential to understand the IP conversation taking place. This involves familiar terms like patents, trademarks, copyrights, and trade secrets, and not so familiar terms like defensive publications, in-licensing, out-licensing, and open source.

These terms, and many more, are discussed daily in virtually every news source, including newspapers, magazines and blogs. And they are no longer just IP terms — but business terms that can make or break a company.


Vincent LoTempio
About The Author Vincent LoTempio [Full Bio]
Vincent G. LoTempio is a registered patent attorney focusing on licensing, patents, trademarks and copyright law for inventors and corporations. In addition, he is a columnist, blogger and lecturer on intellectual property, and co-author of Patent Fundamentals for Scientists and Engineers.

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