Friday, September 16, 2005

Cisco model for patents

Cisco does all its patent review work on a flat-fee basis. To make the process more predictable and less of a risk, the company built an online patent tool for internal use that reviews the business case for an invention. Cisco engineers using the software answer questions about their possibly patentable innovations. Based on the answers, the software tries to identify whether something is indeed patentable, as well as any legal questions that might need to be addressed. If the software signals that the patent application meets Cisco’s criteria, it will be assigned to a law firm. [Hmmm, other corporations merely have patent committees. Does the Cisco software include an analysis of prior art, and possible claim constructions of terms therein? If not, how could they determine if something is patentable?]

Patents are filed faster, and engineers can track the progress of their patent application online, without having to pester legal counsel. Houston-based Baker Botts does patent work for Cisco, and its attorneys have the same access to the online patent tool as authorized Cisco employees. Dallas intellectual property partner Bart Showalter says working online makes his patent work more predictable and easier to manage. “It eliminates a lot of paper, inefficient communications, in-person meetings and things that would slow things down,” he says.

And after working with the Cisco tool, Baker Botts took it upon itself to create its own extranet for managing patent investigations. Now Cisco pays Baker Botts a fixed fee for the service, which allows authorized Cisco and Baker Botts employees to have Internet access to documents and materials related to technical analysis of a patent application.

Showalter says the emphasis on using technology to streamline processes has been good for his firm’s work and bottom line. “Mark [Chandler] asked me if we were cutting corners,” Showalter says. “I said, ‘No—on the contrary, it’s made me think holistically [! Remember Siemens?] about how to make our systems more efficient.’ ”

While Cisco’s approach has earned it a lot of notice within the legal community, not everyone is impressed. Some law firms argue Cisco is a rare company with the size, technological expertise and resources to work this way. They say smaller clients need a hands-on relationship with their attorneys.

“When you work with smaller, entrepreneurial companies, a lot of what you do depends on relationships. We work directly with companies and the personnel,” says Herb Fockler, a partner at Wilson Sonsini Goodrich & Rosati in Palo Alto, Calif., one of the largest Silicon Valley law firms. “A big company like Cisco probably has fewer instances where they need a personal touch; they just want it done.”

Now, how about a discussion of what's going on in offshoring of patent work!


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