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The business of patents

Dr Dana Ferchland talks to Louis W. Beardell, Jr, Dion Bregman, and Eric Kraeutler about Morgan Lewis Bockius’ growing patent practice, recent market trends, and the rise of ‘big data’ to drive patenting strategies and transactions

Your patent practice has grown significantly over the past few years, especially in 2018. How has this bolstered patent practice added to the firm’s existing strengths? 

Louis W. Beardell, Jr., deputy practice leader: Recent additions to Morgan Lewis’s patent practice in Chicago, Orange County, San Francisco, and Washington, DC have boosted our ability to offer clients exceptional client service across all areas of our intellectual property practice. Our new additions have deepened and broadened our technology and scientific experience, and we have added trial-ready teams, representing companies in the life sciences, technology, and manufacturing industries. The growth of Morgan Lewis’s intellectual property practice provides clear benefits to clients who look to us for patent prosecution and disputes services, as well as deep industry knowledge. The growth of our practice has strengthened our ability to offer clients a full range of patent services, from patent procurement and portfolio management to federal court litigation to International Trade Commission (ITC) and USPTO proceedings. Our new colleagues share Morgan Lewis’s commitment to teamwork, collaboration, and exceptional client service. Our recent growth has been a win for all of the lawyers involved and, more importantly, a win for clients.

Which were the main challenges you faced when growing your market share in the US patent market and how did you take them on? 

Beardell: The main challenge has been to get bigger, while maintaining the strong internal culture of collaboration and teamwork that are the hallmarks of Morgan Lewis. But I am pleased to report that we have met that challenge. On the litigation side, we have fielded trial teams that include legacy Morgan Lewis lawyers and new additions, and you would never know that the team members are not long-time colleagues. On the prosecution side, we shared some very important common clients with our new colleagues. For those clients, we now have larger, fully integrated client service teams that have enhanced existing relationships because we now have more lawyers with a deep understanding of the clients’ technology and products.  

What is the most valuable service a patent practice can offer its clients today? 

Beardell: Morgan Lewis wants to be every client’s best choice for their IP litigation, prosecution and strategy needs. Our ability to serve as a one-stop-shop for patent needs across the technology, life science, energy, retail, and financial service sectors is a great strength. We pride ourselves on the depth and breadth of our technical expertise, our industry knowledge, and our ability to field teams with the closest technical background required for any project.  

In how far do you anticipate the PTAB to change the patent practice landscape in the US? How will specialised boutiques and big firms, like yours, adapt?

Dion Bregman, post-grant proceedings working group leader: It wasn’t long after the America Invents Act (AIA) introduced Inter Partes Reviews (IPRs) in 2013 that almost every district court patent litigation had a corresponding PTAB proceeding. The only patent litigation forums where corresponding PTAB proceedings are not standard are so-called rocket dockets, like the Eastern District of Virginia and the ITC, both of which regularly proceed to determinations more quickly than the PTAB, and rarely stay proceedings to await PTAB determinations. 

Long before the introduction of the AIA, Morgan Lewis’s lawyers were handling adversarial proceedings at the USPTO, including appeals, reissues, and reexaminations. We have a long history litigating complex patent matters, including routinely arguing before courts and administrative panels and taking and defending depositions. These same skills were easily adapted to practice before the PTAB, which is why Morgan Lewis has one of the country’s top PTAB practices. In fact, our PTAB practice has been handling PTAB proceedings since their inception – having argued the second-ever IPR before the PTAB. 

Moreover, Morgan Lewis’s deep technical bench puts us head-and-shoulders above other large general practice firms that do not have the technical expertise associated with patent prosecution practices. Similarly, our highly skilled advocates routinely outmatch patent prosecution boutiques that are relatively new to true adversarial proceedings.   

Some litigation-focused firms did not embrace PTAB practice, which generates substantially less revenue on a per case basis. But Morgan Lewis’s focus readily embraced PTAB practice as a means of offering clients the broadest range of options to address their patent disputes.  

As the pendulum at the USPTO has swung from originally favouring the petitioner to now favouring the patent owner, the number of new PTAB petitions has declined. That said, February saw an uptick in new PTAB petitions (162), but March again dropped to an average of about 100 new PTAB petitions per month. Based on current world events, it is hard to predict what the remainder of 2020 will look like, but Morgan Lewis remains well-positioned to continue excelling at the PTAB. 

Which legal and technological developments do you consider to be the main drivers of change for patent practitioners? How do you adapt to them? 

Beardell: Litigation trends, including changes in venue rules, have made it all the more important for Morgan Lewis to have experience across various forums, including the ITC, the PTAB, and the federal district courts, with a particular focus on Delaware, California, New Jersey, and Texas. On the prosecution side, the first-to-file approach has motivated clients to file earlier in product life cycles. Clients also are opting to keep patent families open, allowing for new continuing patent applications as a hedge against PTAB invalidations. Finally, increased collaboration among institutions and business entities in the life sciences industry has driven the need for sophisticated due diligence and licensing services.  

As to technological developments, Morgan Lewis is continually upgrading our technology platforms and enhancing our work from home capabilities to ensure that we are available to clients, and can provide access to those attorneys and patent agents that are the best matches for a particular project. Our already robust remote working capabilities have provided a benefit to clients during the COVID-19 pandemic.  

How does your firm’s wide geographical footprint benefit clients of the litigation, prosecution, and licensing practices? 

Eric Kraeutler, practice leader: Morgan Lewis’s geographical footprint provides a clear benefit to clients. Our clients benefit from partners and associates in 31 US and non-US offices who truly practice as a single firm.  

Some of our most valued patent litigation relationships are with longstanding Japanese, Korean, and Chinese clients who engage us for their US patent litigation and prosecution needs. Our Tokyo- and Shanghai-based IP teams work closely with US-based lawyers to maintain client relationships and provide exceptional client service. For example, a team comprised of US- and Tokyo-based Morgan Lewis lawyers recently provided US patent prosecution training to more than 80 specialists employed in the IP department of a Japan-based global medical device client.  

Lawyers from our Washington, DC, Silicon Valley, and San Francisco offices lead our growing Korea IP practice, working closely with Korean law firms and visiting our Korean clients on a very regular basis.

Our trade mark practice is truly global. We manage portfolios and provide trade mark services to clients through virtually all of our US and non-US offices. In addition to our Morgan Lewis trade mark practitioners inside and outside of the US, we have relationships with trade mark practitioners from other firms in many jurisdictions.

In recent years, most of our licensing deals have included some cross-border aspects, and the firm’s attorneys and resources around the world serve as a huge benefit to meet our clients’ needs by providing excellent and prompt support on licensing matters.

Does the firm intend to expand its patent practice, especially its litigation footprint, in continental Europe, especially after Brexit and the UPC decision by the German Constitutional Court in March 2020?

Kraeutler: Morgan Lewis’ growth always has been based on the needs of our clients, so we will add strength where and when it is needed for client service. We are watching closely developments in Europe, including plans for the Unified Patent Court. It is unlikely that we will make significant additions to our patent practice in Europe until we have a better idea where things are going, but we are committed to having a strong IP presence in Europe to serve the patent, trade mark, and licensing needs of our clients.

How do your patent, trade mark, and copyright practices benefit from each other? 

Kraeutler: With 200-plus IP lawyers, Morgan Lewis has one of the largest IP practices of any full-service law firm in the world. The size and breadth of our practice provides a significant benefit to clients because we readily can assemble teams that combine skills and experience from multiple IP practice areas. For example, the Morgan Lewis team that represented clients in the Converse ‘Chuck Taylor’ trade dress case in the ITC included lawyers with decades of experience in ITC practice, as well as an experienced team of  trade mark litigators, with particular expertise in consumer surveys. More recently, we obtained a jury trial win for Gavrielli Brands in a case in which Gavrielli alleged design patent infringement, trade dress infringement, and false advertising arising out of a competitor’s sale of copycat products that emulated Gavrielli’s well known Tieks® ballet flats. Again, the Morgan Lewis team included lawyers with skills across our trial, patent, and trade mark areas. 

On a different level, our patent, trade mark, and copyright practices benefit from one another because we have a culture of collaboration that leads to personal relationships and information sharing across practices. The best referral source a lawyer can have is someone in his or her own practice group. We have a terrific group of partners who know and like one another, know each other’s practices, and stand ready to direct clients to their colleagues with the most appropriate skills and experience for a matter.

How will the increasing importance of data as an asset impact the patent markets? 

Kraeutler: There are at least two aspects to your question. The first aspect has to do with delivering client service. ‘Big data’ is an area of tremendous innovation. Our clients constantly are developing new and innovative solutions to data collection, data-based analytics, data management, and data mining. Many of those solutions involve innovative software, so we are focused on how to protect new inventions in light of the US Supreme Court’s Alice decision, and how to challenge patents when clients are unfairly accused on infringement. 

The second aspect has to do with the business of patents. The LegalTech industry, including such businesses as Lexmachina, Juristat, PatentAdvisor, and Docket Navigator, already collects and analyses huge amounts of data. But the industry is only beginning to scratch the surface in terms of using big data to drive patenting strategies and transactions. Big data has the potential to provide useful tools to measure patent value, and to obtain data-driven insights about patenting strategies. We aspire to be a leader in harnessing these developments for the benefit of clients.

You are known for your longstanding commitment to diversity and inclusion. Are there any benefits that the patent practice has benefited from more than other practice areas because of that commitment?

Kraeutler: Diversity provides clear benefits to clients. Our patent practice is particularly rich in diversity. Our lawyers, patent agents, and technical specialists come from many backgrounds, races, countries, and ethnicities. Some are immigrants and many are second generation Americans. Many of the benefits are obvious. When a firm promotes diversity, it enlarges its potential talent pool, helping it to identify and recruit the very best scientists, engineers and lawyers. Many of our clients are non-US companies, so having lawyers that align with our clients in terms of language and business culture can be a plus. On the litigation side, we have made great strides in recent years promoting, recruiting, and retaining women to lead and participate in our trial teams. Clients, judges, juries, and arbitrators have responded positively to the changing look of our trial teams.