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Vol- 9, Date: 11th November, 2013

SAGACI OUS UPDATES

Sagacious Research Engages Mr. K Vijay Rao As Business Advisor
Sagacious Research welcomes Mr. K. Vijay Rao, a distinguished name in the industry, as business advisor for enhancing companys business growth. Mr. Rao is a seasoned business strategist with 39+ years of experience in several areas including strategy, organizational growth, market development & penetration, international management. He is an avid strategist & visiting faculty to IIMs, IITs & BITS and a regular contributor to multiple business periodicals like Wall Street Journal.

GENERAL NEWS

Major Amendments in Indian Patent Rules in 2013

In 2013, Indian Patent office started functioning as the International Search Authority (ISA) and International Preliminary Examining Authority (IPEA) under PATENT COOPERATION TREATY (PCT) and also made major amendments in Indian Patent Rules for the first time after 2003.

Department of Industrial Policy and Promotion (DIPP), Ministry of Commerce and Industry, Govt. of India has revised the Indian Patent Rules to align its practices with the practices of World Intellectual Property Organization (WIPO).

This is a welcome move after announcement of Indian Patent Office (IPO) as International Search Authority (ISA) and International Preliminary Examining Authority (IPEA). Indian Patent Rule (Rules), after being introduced in 1972, were first amended in 2003 when India was moving forward to comply with its TRIPs obligations. Following are the amendments 1. Identification of Appropriate Patent Office The amended Rules have now allowed for transfer of a Patent application from one branch office to another. Any further application has to be filed at the same appropriate office where the first mentioned application was filed. It is believed that this would consolidate the examination of divisional applications and streamline the process of handling divisional applications. Also, for the sake of uniformity, all the divisional applications which have been filed before the enforcement of new rules would now be transferred accordingly such that the first mentioned application and its corresponding further application are handled by one branch of the IPO. 2. New Format of Patent Document Filing & Presentation Format of patent applications to be filed with the IPO have to include

Characters of not less than 0.28 cm in height Lines shall be widely spaced (at least not less than one and a half spaces) Page numbering at center bottom of each page Line numbers shall be at 5th line of each page including pages of claims. Line numbers shall be in the left margin of the page which has to be no less than

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For patent applications relating to nucleotides and sequence listing of amino acids

Sequence listings in computer readable text format No submission of print form of these sequences

3. Definitions Provided Under Chapter III of International Applications under Patent Cooperation Treaty (PCT) It includes definition of Examining Authority as Indian IPEA, International Bureau of WIPO and Searching Authority as Indian ISA. 4. New Rules (from 19A to 19E) Defining Working of IPO as ISA & IPEA Delhi branch office of the IPO has been made the nodal point of any communication with the International Bureau, any other ISA or IPEA.

Manner in which IPO would act as ISA, Scope of Indian ISA; Mode and conditions of Receiving and Transmittal of International Search Reports (ISRS); Time duration during which ISRS are to be prepared by the Indian ISA; Notifications and Rejections for International applications in cases of unity of invention compliance, defects in applications, and situations of no search. Confidentiality clause consideration under which all matters dealt by the IPO concerning International Applications shall be kept confidential in accordance with the treaty and regulations under the treaty.

Power to the Controller

Can constitute a review committee to determine which protest has been filed on merits. Either 3 months from the date of receipt of the search copy or, 9 months from the date of priority, whichever is later

Time duration for dispensing an ISR

5. New Fifth Schedule The fee schedule in the new fifth schedule, See fee details on Pg13: http://www.ipindia.nic.in/ipr/patent/patent_Amendment_Rules_2013.pdf Conclusion The Indian Patent Rules have been amended to set right the practices and procedures of Indian Patent Office and enable its proper functioning as ISA and IPEA. These are of vital importance and IPO must implement these Rules as early as possible.

S O M E O T H E R T O P N E W S I N T H I S C A T E G O R Y: The Significance of Patent Attorney Services Read: http://goo.gl/g4PPzE Read About 10 inventors Who Never Patented their Invention & Earned No Profits Read: http://goo.gl/Vb72qy USPTO To Launch Several Minor Rule Revisions Favorable for Patent Applicants & Owners Effective From Dec 18, 2013 Read: http://bit.ly/1apFr7y GoodLattes Patent Reform Bill Draws Mixed Reaction From Industry Camps Read: http://goo.gl/S6O2EJ Royalty-free Defensive Patent License (DPL) to Launch in February 2014Read: http://ow.ly/qswBZ

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LIFE SCIENCES

Whats Behind Rejection of Compulsory Licensing Plea of BDR

Pharmaceuticals?
The Indias patent office recently rejected issuance of a compulsory license application filed by local drug maker BDR Pharmaceuticals International Pvt. Ltd to make and sell patented blood cancer drug, Dasatinib

Introduction While the belief is that compulsory licenses are involuntary contracts imposed by the state but theres a positive side, particularly in developing countries. These legal instruments enable local firms to manufacture the generic versions of patented products (drugs, medications etc.) and sell those at cheaper prices. The justifiable criteria for issuance of compulsory license includes Affordability Shortage of supply A medical emergency in the local market But the applicant must strictly meet all the threshold requirements prior to engaging the patent office for hearing a compulsory licenses application. Indian Patent Office Rejects Compulsory Licensing Application of BDR Pharmaceuticals The Indias patent office recently rejected issuance of a compulsory license application filed by local drug maker BDR Pharma ceuticals International Pvt. Ltd to make and sell patented blood cancer drug, Dasatinib. This was on account of inability to meet those threshold requirements by the applicant company. Under Indian patent law, a compulsory license applicant must first attempt to procure a voluntary license from the original patentee. If this attempt does not succeed within 6 months of the initial request, the applicant is free to file a compulsory license application. The application of BDR Pharma was rejected as published on the patent offices website, stating that BDR did not respond to quest ions, put forward by BMS and that included queries such as whether BDR had the necessary resources to produce quality active pharmaceutical ingredients. The order also stated that BDR, instead of answering these questions, filed a compulsory license application after a year of its initial request letter. Thus, it is evident that BDR had not really made any credible attempt to procure a compulsory license and could not be said to have satisfied the statutory requirement that the applicant must have negotiated in good faith for six months at least. BDR sought the compulsory license for this drug including two other drugs viz. trastuzumab and ixabepilone early this year. About Dasatinib (Brand Name Sprycel) Dasatinib, previously known as BMS-354825, is an oral cancer drug that belongs to multi-BCR/Abl and Src family tyrosine kinase inhibitor approved for first line use in patients with chronic myelogenous leukemia (CML) and Philadelphia chromosome-positive acute lymphoblastic leukemia (Ph+ ALL). Dasatinib is also undergoing preclinical evaluation for its potential as a therapy against multiple myeloma. In India, retail price of this life saving drug is magnanimous and for a months dose, it demands a price of Rs.1.65L. On the other hand, BDR promises to make its version available at around 8,100 rupees. Bristol-Myers Squibb (BMS) has a composition-of-matter patent covering Dastanib that will expire in 2020. The companys dependence on Sprycel is huge especially since their patent for blood thinner drug Plavix expired last year. But in India, BMS is defending its Sprycel patent.

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Conclusion When a company applies for a compulsory license, it needs to show that the public requirement for the product in question has not been met and that it sought a regular license from the innovator and failed. Yet, if a plea is rejected, these are the two feasible routes Mount a legal challenge against rejection order. Second, renegotiate the license with patentee, comply with the 6 month time window and then apply for a fresh application.

Discover the Need for a Stricter Patent Regime for GM Crops

Agri-biotech companies wish to ensure a profitable return on their investment for bringing a GM food to market. They have aggressively patented several strains of GM plants and patent infringement is a big concern.

Introduction Genetically Modified (GM) Crops or GM foods refer to crop plants created using the latest molecular biology techniques (genetic engineering) and enhance desired traits. The popular example of this is the use of B.t. genes in corn, brinjal and cotton. B.t., or Bacillus thuringiensis, is a bacterium that produces crystal proteins that are lethal to insect larvae. B.t. crystal protein genes are transferred into plants, enabling them to produce its own pesticides against insects. GM Crops Pros GM foods promise to meet the food supply for booming world population in a number of ways: Make Plants Pest resistant, Herbicide tolerant & disease resistant GM foods help eliminate the application of chemical pesticides (thereby reducing potential health hazards, poisoning of the water bodies) and reduce the cost of bringing a crop to market, financial loss to farmers and starvation in developing countries. Crop plants genetically-engineered to be resistant to herbicides could help prevent environmental damage by reducing the amount of herbicides needed. For example, Monsantos patented Roundup strain of soybeans genetically modified to be not affected b y their herbicide Plants are also genetically-engineered to become disease resistant, cold tolerant & drought tolerant.

Meet Nutritional Requirements Crops (for instance, Rice) could be genetically engineered to contain additional vitamins and minerals. Researchers at the Swiss Federal Institute of Technology Institute for Plant Sciences had created a strain of golden rice containing an unusually high conte nt of betacarotene (vitamin A). However, this nutritionally-enhanced GM crop did not ever come to the market due to vigorous anti-GM food protesting in Europe. GM Crops Cons 1. Environmental hazards Harm to non-target organisms Unfortunately, B.t. toxins kill many species of insect larvae indiscriminately; it is not possible to design a B.t. toxin that would only kill crop-damaging pests and remain harmless to all other insects. As such, currently, the potential risk of harm to non-target organisms will need to be evaluated further. Reduced effectiveness of pesticides Just as mosquitoes developed resistance to DDT, many people are concerned that insects will become resistant to B.t. or other crops that have been genetically-modified to produce their own pesticides.

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Gene Transfer to Non-Target Species & Creation of Superweeds If crop plants engineered for herbicide tolerance and weeds cross-breed, herbicide resistance genes will be transferred from the crops into the weeds. These superweeds would then be herbicide tolerant as well. 2. Human Health Risks GM Foods pose potential threat of allergies & unknown health hazards for humans. As such, a proposal to incorporate a gene from Brazil nuts into soybeans was abandoned because of the fear of causing unexpected allergic reactions. Moreover, the importance of extensive testing of GM foods was asserted to avoid harm to consumers. There is also a growing concern that introducing foreign genes into food plants may have some unexpected impact on human health. Patent Related Issues for GM Crops Patent Wars Patent enforcement of GM crops is a big issue. In case of GM crops, it is likely that some of the introduced genes may cross over into non-modified crops planted near to GM crops (via phenomenon of inter or cross-breeding), there arises many problems. As such, many lawsuits have been filed against farmers by Monsanto Inc. The company sued farmers in US, Canada and several European countries who may have harvested GM crops. Monsanto claimed that the farmers obtained Monsantolicensed GM seeds from an unknown source and did not pay royalties to Monsanto. The farmers argued that their unmodified crops were involuntarily cross-pollinated from someone elses Monsanto-engineered strains planted nearby. Effect on Developing Countries Earlier, methods of agriculture and plants were excluded from patentability in the Indian patent act to ensure that seed, the first link in the food chain, was held as a common property resource in the public domain and farmers absolute right to save, exchange and imp rove seed was not violated. But agri-biotech companies wish to ensure a profitable return on their investment for bringing a GM food to market. They have aggressively patented several strains of GM plants and patent infringement is a big concern. Patenting these new plant varieties will raise the price of seeds and the small farmers of the third world countries will not be able to afford seeds for GM crops, thus widening the gap between the wealthy and the poor. The Second Amendment of the Indian Patent Act In 2003, Second Amendment to Indian Patent Act played a major role in the area of patenting of seeds and plants, especially genetically engineered seeds. This opened the floodgates of patenting of genetically engineered seed in India. According to Section 3(i), the following is not an invention: Earlier, any process for the medical, surgical, creative, prophylactic or other treatment of human beings or any process for a similar treatment of animals or plants to render them free of disease or to increase their economic value or that of their products was not patentable in India. The amendment omitted plants from this section thereby making modification of a plant, a patentable invention. Thus the method of producing Bt cotton could be granted exclusive patent rights in India. The Second Amendment added a new section, 3(j) This allowed production or propagation of genetically engineered plants to be counted as an invention, and hence patentable. These Amendments had been made in Indias patent laws in compliance with TRIPs agreement.

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Conclusion Genetically-modified foods are a powerful weapon that has the potential to solve worlds hunger and malnutrition problems & preserve the environment by increasing yield and reducing reliance upon chemical pesticides. We cannot afford to ignore a technology that has such enormous potential benefits. Yet, governments, especially of the developing countries like that of India, must proceed with caution while implementing a patent regime for GM crops and ensuring safety testing, regulation, international policy and food labeling. The correct valuation of GM crops and aligning their relevance to agricultural practices besides avoiding causing unintended harm to human health and the environment is the need of the hour.

Whats Driving Pharmaceutical Patent Filings in India?

Unearthing the real scenario of patenting in pharmaceutical sector in India

Introduction India embraced product patenting in the pharmaceutical sector in 2005 and its patenting criteria have received appreciation for their exclusion of incremental inventions of little therapeutic value. Let us unearth the real scenario of patenting in pharmaceutical sector in India.

Indian Patent Filings of Foreign vs. Indian Drug Manufacturers Notably foreign drug manufacturers have recorded much better success rates in securing patents in India due to their selective approach. Others, whether Indian or foreign drug manufacturers, have success rates of between 10% and 25%. Novartis

Swiss major Novartis, in April 2013, was denied patent protection for cancer drug Glivec on the grounds of the substance in question being an amended version of a known compound. Supreme Court denied patent as the drug failed to pass the scrutiny of Section 3(d) of Indias Patents Act. Pfizers cancer drug Sutent also lost patent protection in India much recently. Yet, Novartis has 267 granted patents in India out of 1,435 patents that it filed since 1995 and enjoys a success rate of 19%.

Pfizer US major, Pfizer has the distinction of getting the most number of patent applications approved in India. With 675 patents issued out of 1,402 applications (asuccess rate of 48%), it is much ahead of its closest competitor Roche Holdings with a success rate of 42%.

[Note: Section 3(d) excludes new forms (isomers, salts etc,) of existing substance from patenting unless it resulted in an appreciable enhancement of efficacy of the medicine in question. The Indian government claims that Section 3(d) is compliant with the WTO s Trade Related Aspects of Intellectual Property Rights (TRIPS)] 2007 - 2013 Sagacious Research. All Rights Reserved. www.sagaciousresearch.com

Cipla Indian drug-maker, Cipla is also a patent-seeker. Cipla has filed for more than 360 patents, and has a grant rate of 20%. This large Indian company has not denounced the concept of patents but only argued for generic producers getting the right to break patents by paying what he considers reasonable royalty to the patent-holder in case of national emergencies or other public health exigencies.

Issues with Pharma Cos. in India India presents pharma companies with both unique challenges and opportunities, including a stout manufacturing sector, a vast market and huge potential for monetising patented inventions. Thus, pre-empting others from making use of the knowledge gathered by it is often the motive behind patent filings. As such, it is also fairly reasonable to expect patenting strategies of individual pharma companies to be dependent on how much the drug is important to the firms business. 1. Pharmaceutical patents are mostly applied for with basic data, which prove that the substance is efficacious. Then, over the time company conduct in-vitro and in-vivo studies to validate these discoveries and establish their effect on particular illness, a process that may take years. The failures in the course of these experiments are common and therefore, a major chunk of patents applied for/granted never reaches the commercial arena. 2. Lack of Funds & Resources Domestic Indian pharma cos. are grappling also with issues like lack of resources. Indian drug makers have good research pipelines, but do not have enough funding to take it to the next level so that they are able to commercialize that research. Then, the pool of patent examiners is inadequate. Moreover, patent filings are of international nature (simultaneous filing in multiple countries) due to the Patent Cooperation Treaty (PCT) route. Conclusion More Indian companies have opted for patent filings in the last 3-5 years and are also doing more R&D. Overall awareness has definitely improved. Foreign filers are already active in this arena. So although, the majority of the patent applications in this sector still tend to lean towards the process of drug development and novel pharmaceutical compounds or improved processes, leading Indian companies are also showing increased interest in Patenting new drug delivery systems (NDDSs). There is no explicit bar on patenting of NDDSs and this R&D area is relatively less costly. Other information/pathways that could potentially have a commercial utility. For example, In 2006, Ranbaxy Laboratories applied for a patent for method of providing product information using adhesive free printed literature. It was later withdrawn. Pfizer, in May 2011, filed for an invention an apparatus for handling capsules and capsule processing equipment including such an apparatus. The application is awaiting examination.

S O M E O T H E R T O P N E W S I N T H I S C A T E G O R Y: Checkout Top 10 Drug Patent Losses of 2014 Read: http://goo.gl/42dA97 Probiogen Maintains Strong Patent Position in Area of Viral Vaccine Manufaturing Read: http://goo.gl/IDdCD5 Judge Invalidates Non Invasive Method of Detecting Foetal Down Syndrome Test Patent in US Read: http://ow.ly/oTutf VG Life Sciences Peptide VG1177 Awarded US Patent for HIV treatment Read: http://ow.ly/qssXH
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TECHNOLOGY

WebOS-Related Patents to Carve HPs Future

HP explores for highest payers for its webOS-related patents

Patents earn profits in todays market, whether through acquisitions (patent buy outs) or by forcing other companies to pay a royalty fee for using technology (licensing) that could possibly infringe on a related patent and also by selling. Selling patents and patent applications that arent generating a strong return on investment is another viable option that individual inventors and companies are offered. Perhaps, this is what is forcing HP to offload its webOS patents purchased at a whopping sum of $1.2 B. Here are some examples of popular & profitable patent related deals: Google-Motorola Mobility patent buy out for $12.5 B AOL Microsoft patent licensing deal for $1.06 B Nokia-Microsoft licensing deal for $5M

HPs WebOS Patents WebOS is a Linux operating system initially developed by Palm and launched in January 2009, then called Palm WebOS.Here are two exemplary patents that were granted to Nokia Corporation in WLAN technology area Various versions of WebOS have been featured on mobile devices viz. Pre, Pixi, Veer phones including the HP TouchPad tablet Its last updated version, 3.0.5, was released in 2012 WebOS operating platform was acquired by Hewlett-Packard (HP) in 2010 HP had shutdown webOS hardware development in 2011 and made the platform open source, and it became Open WebOS. HP rebranded it as a wholly-owned subsidiary called Gram HP agreed to license webOS code to LG Electronics in February of 2013. HP, however, maintained control of webOS cloud services. HP is reportedly looking to offload some of its mobile patents including webOS patents as it appears to be committed to Android as its preferred mobile operating system. HP Explores for Selling WebOS Since its launch in 2009, webOS appeared on a couple of phones. HP had also planned to use this operating platform and launch a whole new series of multiple new products including smartphones, tablets and printers. But unfortunately, except HP TouchPad, other HP devices based on webOS platform never got launched. At the same time, HP had to part with its HP Personal Systems Group. Subsequently, HP had to discontinue support for webOS but the company re-branded WebOS as a wholly-owned subsidiary called Gram. Later, HP licensed webOS code to LG for use in their web-enabled Smart TVs, expected to launch in 2014. But the HP-LG licensing deal allowed HP to retain patents related to the webOS operating system. Now, HP explores for highest payers for its webOS-related patents and this makes perfect sense as: First, HP has no ambitions to develop its own mobile platform in the future and will rely only on Windows and Android for its tablets. HP Touch Pad lasted less than 2 months in the market in 2011 before it was discontinued. Second, as the company revenues are falling and all its units are under performing.

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Conclusion HPs acquisition of Palm and its webOS patents certainly did not work favorably for the company and to get over its $1.2 billion mistake, HP has to strive hard and take concrete measures to sell off these patents. Paying maintenance fees for patents, that company has no plans to use, is a financial burden. It is not that those patents are not useful but they can be better used by others. Thus, for HP, this patent selling seems like a good and viable proposition that will give financial leverage to the company, help in stabilizing its revenues and support its business development. Recently, HP has removed some of the sales restrictions that it had placed on its mobile patents and that is expected to make their patent portfolio more attractive, entice more potential buyers. As such, HPs mobile patents and webOS mobile platform related patents would now possibly command a higher price.

Digging Up Kodaks Digital Imaging Patents

Kodak claims that 1,000 of its 11,000 patents relate to digital imaging technologies.

Introduction Once a pioneering company of digital photography, Kodak, in an interesting article, was referred to as Apple in Reverse to compare Kodaks meteoric fall with Apples meteoric rise. Back in 1997, Kodak was a $28 billion dollar company while Apple was worth a meager $2B. Apple marched ahead to notch the title of one of the most valuable companies in the world and Kodaks future became murkier every day.

Kodak filed for Chapter 11 Bankruptcy Protection in 2012 but announced that it has emerged from bankruptcy on September 3rd, 2013. Companys plans to sell its digital imaging patents for about $525 million to some of the worlds biggest technology companie s was at the core of such an emergence. It can be attributed to Kodaks strategic business move to find a buyer/licensee for its digital imaging patents and its lawsuits are presumably part of its sales and marketing effort for its patent selling/licensing. Kodak claims that 1,000 of its 11,000 patents relate to digital imaging technologies. As such, time and again Kodak has filed volley of patent infringement lawsuits against major technology companies. It has helped Kodak revive its failing business. However, it hasnt proved that Kodaks patent portfoli o is very strong and valuable. Yet, major technology companies viz. LG, MEI/Panasonic, Motorola, Nokia, Olympus, Samsung, Sanyo, Sharp, Sony and Sony Ericsson have licensed Kodaks technology patents. Recent Lawsuit $75.8 M Win for Kodak against Ricoh Kodak alleged that when Ricoh purchased Pentax (brand name used by Ricoh Imaging Company for cameras, sport optics e.g. binoculars, etc.) in 2011, they owed back royalties since Pentax Corporation had never licensed the imaging technology from Kodak. Ricoh said there was no evidence of Pentax having violated Kodak copyright, neither when it merged into Hoya Corporation nor when Ricoh eventually purchased it. The company develops and market cameras under the Pentax brand and has now agreed to shell out whopping $75.8 M to end the ongoing patent battle with Kodak. Kodaks Tussle with Apple, HTC & RIM 4 patents-in-suit against Apple were: 1. 2. 3. 4. U.S. Patent 161 on automatically transmitting images from an electronic camera to a service provider using a network configuration file U.S. Patent 084 on a network configuration file for automatically transmitting images from an electronic still camera U.S. Patent 605 on capturing digital images to be transferred to an e-mail address U.S. Patent 391 on a digital camera with communications interface for selectively transmitting images over a cellular phone network and a wireless LAN network to a destination 2007 - 2013 Sagacious Research. All Rights Reserved. www.sagaciousresearch.com

Kodak also asserted the same four patents and an additional fifth one (given below) against HTCs Android -based devices (viz. HTC EVO View 4G, Flyer, Jetstream, Vivid, Amaze 4G, Desire, Evo Design 4G, Hero S, Rezound, Rhyme, Sensation 4G, and Wildfire S) & RIM. Out of all Kodaks digital imaging patents, this is the patent that Kodak wanted to get leverage for to enter in a billion -dollar deal with Apple. U.S. Patent 218 on an electronic camera for initiating capture of still images while previewing motion images Controversy Around US Patent 218 But this was a controversial patent because the basic concept behind Patent 218 is that while you can have a low -resolution preview on a screen of a small device (be it a digital camera or a smartphone), which is a motion preview because it is constantly refre shed as you move the device, you can also press a button and capture a high-resolution still image. Thus, it is evident that it really made no contribution whatsoever to digital imaging technology. Apparently, Kodak is not in a proposition to extract much value out of this patent. The patent claim mentions a lot of real technology, especially sensors, but all of this was simply prior art that Kodak combined in a novel way. Limitations of Claim 15 of Kodaks patent-in-suit It is not applicable for all the different kinds of image sensors It specifies photo cameras have a capture button but all of them have it It claims that it can store a processed captured still image but it is obvious that any computer memory, such as the one fo und in smartphones, can store an image Consequently, it was ruled that this patent claim was invalid because the simple idea of storing a preview image in memory is obvious as compared to existing prior art. Technologically, its not really the kind of advance that deserves the 20 -year monopoly that a patent protection gives. But, USPTO upheld this patent claim when the patent was reexamined. Conclusion While we witnessed wins for Kodak against many tech companies, we also dug up the flaws in Kodaks patents (explained in the article above). It was observed that while Apple took a strong stance against Kodak, Samsung and LG preferred to enter a royaltybearing license agreement & Richo shelled out a huge sum of money to settle a lawsuit with Kodak. But all that does not imply that every tech company has to enter a licensing deal in haste. Instead, in a situation where there is apprehension that they may be sued (considering that IP litigation is an expensive pursuit and also harms reputation in the market), shall seek professional patent search services. At the very least, they could partner with a trusted name who could furnish high quality results/reports of licensable patents besides giving technology watch/competition watch services.

IBM vs. Twitter-Twitter Accused of Infringing 3 Online

Advertising Patents
IBM accuses Twitter of infringement of its three advertising patents

Introduction According to a government source, IBM currently holds nearly 87,000 US patents and published applications. Twitter, meanwhile, owes just 9 U.S. patents and its 95 U.S. patent applications are pending relatively few for a technology company.

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This suggests that the legal ploys involving the two tech giants will increase the pressure on Twitter to buy more patents. This might also be a business strategy that IBM is employing to signal to the market that it has a strong position as far as the patent portfolio is concerned. Patent infringement claims against tech companies approaching an IPO are so common these days because plaintiffs believe that the target company in a bid to minimize risks might end up doing a lucrative settlement deal. As such, comes this patent infringement threat to Twitter just ahead of its plans to go public. In the meantime, Twitter has raised its IPO estimate from $17 to $20 per share to $23 to $25 per share. In the past, Yahoo! Inc. sued Facebook Inc. for patent infringement two months before Facebooks IPO. Yahoo! eventually withdrew that lawsuit. However, Facebook ramped up a patent-buying spree shortly after the lawsuit was filed. It bought 750 patents from IBM for an undisclosed sum, and paid Microsoft US $550M for AOL patents. IBM Accuses Twitter for Patent Infringement In a twist to its pre-IPO S-1 filing with the US SEC, Twitter has received a letter from IBM accusing it of infringing 3 of the companys patents related to: Efficient retrieval of uniform resource allocators Presenting advertising in an interactive service Programmatic discovery of common contacts IBM has indirectly invited the short messages services firm to talks. Twitter has been vocal in the ongoing debate over how strong patent protections should be when it comes to software. Twitters unusual intellectual-property strategy is such that it has scanty number of patents in its name. Twitter gives away the patent rights on their inventions to its employees, rather than assigning them to the company, as is the common practice. As such, Twitter cant pursue offensive litigation without the inventors permission. This is also the probable reason why Twitter has asserted in the past that it wanted to steer clear of patent litigation, use patents for defensive purposes only and rather focus on business. However, what threatens Twitter is, not those patents, but the might of IBM. IBM stands out as a patent leader since 19 years in US by extensively filing patents in the area of open source software, health care, education, environment and software interoperability. Conclusion Patent disputes have heated up in recent years as the explosion of mobile devices and the wealth created by them raises the stakes for giants like Apple, Samsung and other companies. These disputes highlight the increasing significance of use of intellectual property as a weapon against rival companies. As such, tech companies seek professional licensing support services, for instance, mining licensable patents, infringer identification etc. Last week, a company backed by Apple, Microsoft and Blackberry (Rockstar consortium) filed patent claims against Google, Samsung, and many more Android mobile vendors. In Twitter-IBM case mentioned here above, either IBM will negotiate a business resolution with Twitter or Twitter will present its meritorious defenses against IBMs allegations. However, in any of these circumstances, it is most likely that Twitter will e ither change or modify its patent strategy following footsteps of Facebook.

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S O M E O T H E R T O P N E W S I N T H I S C A T E G O R Y: Google Patents Love-shaped Gesture in US Read: http://goo.gl/1FxjTY Nokia Earnings in Q3 2013, NSN & Patents Drive Value Read: http://ow.ly/pB6AN Huawei Wins Antitrust Lawsuit Over 3G Cellphone Patents Against US- based IDC & Get $3.28 M in Compensation Read: http://goo.gl/RBxCFO Apple Granted 40 US Patents Covering Fingerprint Sensors, Pressure Sensor Displays, iPad Smart Case & More Read: http://goo.gl/S66TVN

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AB O UT SAGAC I O U S R E S EAR C H
Sagacious Research is an ISO Certified India based Global Patent Research & Analytics firm offering cost effective & multi-lingual Patent Searching, Patent Licensing, Patent Alerts & Watches, Patent Drafting, Trademark Searching & Design Searching Services in over 100 countries and in over 16 Asian/European languages. An ISO 9001:2008 and ISO 27001:2005 Certified Company 70+ Techno-legal Experts | 16+ Languages | 100 Countries | 5, 000+ Projects | 99% Client Retention

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