Editor: Randy, please give us an overview of CPA Global Patent Research and the services it provides. Describe your role and background.
Lacasse: CPA Global is one of the oldest and most experienced intellectual property services firms in the world - we are celebrating our 40th Anniversary this year. The Patent Research Division, which is comprised of various technical disciplines including electrical, mechanical, chemical, and bio-tech engineers, typically performs patent research on behalf of large corporations in the United States, Europe, Asia and the largest global IP law firms. We do a variety of different types of searches. They include:
Novelty type searches, i.e., searches that give an inventor an opportunity to see what similar inventions have been developed prior to their invention;
State-of-the-art searching for research institutions to help guide their own research;
Patent infringement research for companies prior to putting products on the market to determine what if any patents they potentially might infringe; and,
Validity searching for companies that are sued for patent infringement helping them establish how strong the case against them is and how best to defend themselves.
In addition, CPA Global conducts accelerated examinations for those companies that want to expedite their patent prosecution cycle in the United States (i.e. less than 12 months). As the U.S. patent application process has become more rigorous in recent years, this option has become increasingly appealing to companies seeking patent approval. CPA Global has established itself as a leader in this area; indeed, CPA Global's rate of approval in assisting clients with accelerated examinations is nearly 100 percent.
Another area of operations is "landscape work," where we assist business decision makers in understanding their competitors and the IP market they are either entering or in which they're currently competing.
As for my background, I have been in the IP industry for approximately 25 years. I started at the U.S. Patent Office and eventually went on to oversee IBM's patent research program worldwide. I then founded my own company, Lacasse and Associates, which, after 14 years, was purchased in 2007 by CPA Global. I am now the worldwide CEO for CPA Global Patent Research. The patent research team has offices in the United States, Germany, United Kingdom, and India.
Editor: How large is CPA Global Patent Research in terms of volume of sales and number of employees?
Lacasse: CPA Global is a privately held company, employing more than 1,200 employees across the globe. In the Patent Research division, we have approximately 100 patent searchers currently supporting over 900 corporations and law firms around the world. The search group is celebrating its 16th anniversary this year and we are proud to say that, during this time, we have conducted more than 50,000 searches.
Editor: Would you describe recent patterns or trends in the area of patent issuance, e.g., volume, regional variations, subject matter variations?
Lacasse: We have seen patent filings continue to rise at approximately 7-12 percent a year worldwide. The largest growth areas are the U.S. and Chinese patent systems followed right behind by the Indian patent system. One recent trend in the U.S. is that the yearly issuance rate of patents has dropped from approximately 78 percent ten years ago to closer to 40 percent of patent filings today. This large drop in the issuance rate is a real problem for inventors and their supporters - for every ten dollars spent on innovation only four dollars are spent promoting IP protection. It is a difficult situation right now in the United States. The European and Japanese patent offices have higher issuance rates and have not seen as dramatic declines. This may be primarily a function of the U.S. Patent Office's self-imposed regulation designed to increase the quality of patents. Court decisions have also made the U.S. Patent and Trademark Office gun-shy about issuing patents. The Bilski case decided by the U.S. Court of Appeals for the Federal Circuit in October 2008 adopted a more stringent test for the patentability of processes. It affirmed the Patent Office's rejection of claims for hedging risks for trading commodities. This rejection was based on the Patent Office's finding that the business method was not tied to a specific machine and did not transform a particular article to a different state or thing, i.e., the "machine-or-transformation test."
Editor: If patent issuance rates are diminishing, to what do you attribute this? What do you perceive to be the attendant risks or adverse consequences of this phenomenon, and what measures would you suggest to reverse the trend?
Lacasse: Because of the U.S. Patent Office's strict self-imposed policy of non-issuance of weak patents, it is important for patent applicants to overcome this barrier by doing a proper and very thorough search prior to making an application. Companies like IBM and other large organizations that perform a lot of patent searching do not typically experience the same low issuance rates. By conducting a comprehensive search, companies can invest their IP dollars in opportunities that are more likely to survive the patent approval process. In the face of a dropping issuance rate, we are advocating novelty-type searches and searches showing certainty of patentability by performing introductory searches to make sure that we eliminate questionable inventions.
Editor: What role has the KSR case regarding the "obvious principle" played in diminishing the number of patent applications?
Lacasse: I think that it raises the standard. However, it is somewhat of a tough question because the KSR case claims may not have been well written by the applicant, so we need to be careful how it is interpreted. The effect of that decision has been to set a different standard for establishing novelty in patent claims (specifically, combinations of references).
Editor: How does the accelerated examination program improve on the results showing a larger percentage of patent applications that are approved?
Lacasse: Accelerated Examination (AE) applicants in the U.S. are seeing issuance rates as high as 70 and 80 percent - nearly double the success rate of a patent application filed via the standard approach. These results provide a significant opportunity for companies to develop an advantage, especially in highly competitive industries. By investing in performing a comprehensive search, these applicants are receiving faster and higher issuance rates.
Editor: Have you detected any significant changes in patent recognition and enforcement in the developing world?
Lacasse: While we still haven't seen significant enforcement of patent rights in China, we have seen an enormous push by U.S. and European clients trying to obtain Chinese patents. The reason is simply that, in China, the Chinese are actually manufacturing foreign products and foreign processes or using ideas borrowed from others. While the Chinese are not enforcing the rights of others to any extent today, with patents surviving 20 years from the filing date, it may mean patent rights will be enforced in the future. When the Chinese do start enforcing them, it will be better to have patents that one can use to negotiate licensing deals, etc.
The Chinese themselves are becoming very concerned with protecting their own patented products. This may also be why we are seeing a significant increase in patent activity in China. As the Chinese recognize the value of their own IP, they may be more likely to support enforcement.
Editor: What has been the effect of regional patent offices abroad, e.g., the European Patent Office, on the overall volume of applied-for and issued patents?
Lacasse: In the past two years, the European Patent Office has pushed the patent-searching requirement out to its regional patent offices to free up the EPO so that it can be more effective. I think that is significant because, while all searches were previously done at the EPO, they are now being performed as well at the Dutch patent offices, the Swiss patent offices, etc. In Europe, as compared to the U.S., you can do a fairly quick search and have an early understanding of where essential patent rights stand.
Editor: How does CPA Global Patent Research assist its clients in the areas of patent enforcement?
Lacasse: With regards to litigation support for clients, we have a legal process outsourcing group (LPO) that provides document review, e-discovery, legal research, contract review and other litigation support services.
As far as enforcement goes, we provide litigation support based on our technical research. That research determines the strength of patents both for purposes of challenging and defending them. Before challenging or defending a patent, a client would like to know up-front how strong the opposition party's patent is and their ability to effectively sue or defend.
Editor: The CPA Global website refers separately to "Patent Analytics" and "Patent Research." How do these specialties differ?
Lacasse: The technical and industry experts conduct the actual research and then turn it over to our analytics team. The analytics group, which is well versed in mathematics and trend analysis, will run analytic software along with the patent research to detect trends, develop competitive analysis and gather other industry intelligence.
Editor: What kind of business atmosphere also contributes to innovative thinking and bringing forward of new inventions? What incentives are needed to stimulate creativity of new products and ideas?
Lacasse: Large companies often provide financial incentives for their employees not only to invent but to seek out patent licensing opportunities from others. We at CPA Global do the same for our own employees. We reward both innovative thinking and the protection of that thinking. For companies trying to differentiate themselves today in a down economy, being innovative is absolutely essential.