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MITIGATING RISKS


carries with it an inherent risk of infringing someone else’s patent. This is the case even when you have obtained a patent for the new technology since it is possible for the same technology to still be covered by an overlapping third party patent (see box on Overlapping Patents).


MANAGING IP RISK


There are essentially two approaches to dealing with the risk that arises when developing new technology.


APPROACH 1 APPROACH 2


A first approach is to accept the risk on the assumption that should an IP right owned by a third party materialise, there will be a way to address it. While this approach is entirely legitimate and is probably the most common approach taken by many companies (although sometimes unwittingly), it should only be taken when the risk has been understood and there is a credible strategy for dealing with any third- party IP rights that may materialise.


A credible strategy for the first approach may include taking a calculated risk that a licence will be available for a patent covering


OVERLAPPING PATENTS


Just because your product is protected by your own patent, does not mean that the product cannot infringe a patent owned by someone else. Multiple overlapping patents can exist in a way that is analogous to a nest of Russian dolls in which each doll represents a patent covering a specific aspect of a technology.


For example, you may own a patent for an inspection process that uses LiDAR (i.e. a small doll), but someone else may own a patent for the same process using any type of remote sensing (i.e. a larger doll). This means that you would not be able to exploit the technology without the consent of the person owning the patent to the process using any type of remote sensing.


Conversely, the person owning the patent for the process using any type of remote sensing would not be able to use LiDAR without your consent. In such a situation, neither of the two companies owning the patents can use LiDAR without the consent of the other.


A second approach is to try to mitigate the risk by ‘clearing the way’ in order to ensure that a development path is not pursued based on technology that later turns out to be protected. Typically, this is done by searching for IP rights owned by third parties and evaluating those rights to determine whether they are likely to present a risk.


This process can also be used to identify any gaps in protection that could be exploited. Before conducting a search, a cost-benefit analysis needs to be performed to ensure that the cost of ‘clearing the


the technology or knowing that the original product can be withdrawn and replaced with a non-infringing product and that any damages which may have accrued through sale of the original product can be settled. This first approach may be appropriate for low-value or low- volume products that are not critical to the business. However, for high- value or high-volume products that are business critical, the approach can lead to significant and sometimes catastrophic difficulties further down the line.


way’ does not outweigh the benefits of mitigating the risk. Strategies may therefore be adopted which are based on the nature of the project/ technology.


For example, a strategy for a product that finds sole application in a business sector in which a company has operated for many years may confine a search to IP owned by key competitors. Conversely, a product that has a more general application to sectors unfamiliar to a company, or a product that is particularly innovative or critical to the business, may justify a more extensive search.


SUMMARY


Instructing a patent attorney to search for and review patents owned by a handful of key competitors, particularly if done early on in a project, can save a huge amount of time, uncertainty and cost at a later date. It also enables a company to pursue a project with confidence and to provide assurances to customers, partners and potential investors that the risks have been understood and dealt with properly.


Author – Sam Bloor Senior Associate Secerna LLP


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SAM BLOOR


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JASON BOAKES www.wavetidalenergynetwork.co.uk 9


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