Nath, Goldberg & Meyer is a boutique intellectual property law firm that offers leadership to its clients in developing, managing and licensing patent and trademark portfolios. We have a track record of protecting advanced technologies in biomedical, chemical, pharmaceutical, electrical and mechanical inventions, designs, trade secrets, trademarks. We offer both domestic and international general counsel services.
I am "The Green Patent Guy"; a patent attorney who helps companies that want to protect their innovations in under one year to introduce new products, prevent competition and build company value get it done. I help clients let people live in the future.
In this episode
Joshua Goldberg of Nath, Goldberg & Meyer warns that protecting your intellectual property on an international basis is both necessary and non-trivial. Josh points out that there is no such thing as a world-wide patent, effective anywhere you might be doing business or might want to do business. Patents are territorial, with each country around the world having its own separate patent system with different laws and protections. This means that, if you get a US patent, you can only use it to stop competition here in the US. Should you conduct sales, manufacturing, or other operations in other countries, you could face undue competition there if you have not filed for patent protection in each relevant country.
Failure to obtain patent protection in certain key countries might lead to the existence of a global marketplace for “your” product, but one that is entirely out of your control. Third-party manufacturing can happen in one country, where there is no patent protection, with goods from there being shipped around the world. Even further, a prospective client of yours could try to buy the goods in the other country and then bring them here to the US, rather than buy them directly from you. Josh provides 6 key steps you need to follow to protect your inventions on an international basis. Listen to the end for a gift that can help get you started.
A glimpse of what you'll hear
03:40 Think about where you operate today and in the future because patents are territorial.
07:42 Playing defense - how to use intentional patents to protect your current business in your home market.
12:06 You could sue your customer for a patent violation but is that wise?
13:49 There are a lot of nuances to consider when it comes to global competition..
15:10 You don’t need to file for patent protection in every country, just the key ones.
18:00 6 steps to create a strategy for patent protection on a global basis
19:52 Benefits and costs from having the right international patent protection program.
24:24 It takes an international team of patent attorneys and experts.
28:56 Learn about Joshua. Email Joshua at email@example.com or call at +1.703.548.6284.
(Note: this was transcribed using transcription software and may not reflect the exact words used in the podcast.)
00:00:04:13 - 00:00:22:18
Welcome to the best kept secret video cast and podcast from Centricity. If you are a B2B service professional, use our five step process to go from the grind of chasing every sale to keeping your pipeline full with prospects knocking on your door to buy from you. We give you the freedom of time and a life outside of your business.
Each episode features an executive from our B2B services company sharing their provocative perspective on an opportunity that many of their clients are missing out on. It's how we teach our clients to get executive decision makers to buy without being salesy or spammy. Here's our host, the co-founder and CEO of Centricity, jokingly.
00:00:43:09 - 00:01:13:04
Jay Kingley co-founder and CEO of Centricity. Welcome to our show where our guests share their provocative perspective on what their target market is missing out on. I'm happy to welcome back to the show for the third time. Joshua Goldberg of Nath, Goldberg and Meyers, Joshua's practice involves portfolio management and analysis, including the preparation, prosecution and acquisition of U.S. and foreign patents.
Josh is based in Brooklyn, New York. Welcome back to the show. Josh.
00:01:18:01 - 00:01:19:12
Thanks for having me again, Jay.
00:01:19:21 - 00:01:52:18
We live in a world where boundaries between countries and jurisdictions are getting fuzzier and weaker all the time. Let's take, for example, the case of I'm a U.S. business. I only sell to customers in the U.S. I have gotten my intellectual property protection, including patents for in the U.S. But what happens down the road, if I want to start to serve customers that live outside of the United States?
What does that mean in terms of the intellectual property protection that I have? Another question What happens if I have a competitor outside the United States who takes a look at my U.S. patent? Uses that information to basically copy? Exactly. Are pretty close to exactly what I have done. Clearly in violation of my patent. However, they are in a different country, so now they are competing with me using my same technology just in a different country.
But now let's say I have a client in the U.S. Maybe there's a subsidiary. Let's take, for example, Japan, maybe they have a subsidiary. And then Jimmy in Japan. Can they now by can that Japanese subsidiary now buy that product, which I have protected in the U.S. from that company in Japan that's violated my U.S. patent? Or what would prevent that company, that client of mine with the Japanese subsidiary buying it through that subsidiary and then having that subsidiary pass it through, ship it into the United States for the U.S. entity to start to use it.
The complexities of international business are great and it seems like I don't even control because on one hand I can control what I do, but I can't control what other companies are doing in terms of outside the U.S. and even when they decide to come into the U.S. and start selling to my customer base. So Josh, this seems like it's really complicated, full of nuance.
Let me ask the expert. How should a business be thinking about intellectual property and patents from a more global perspective?
00:03:52:15 - 00:04:20:21
Well, thanks, Jay. That's a really interesting set of questions. You asked. It is very nuanced. I like to try to keep it as simple as I can for my clients. Where I start on the simple level is we're talking about patents. You get a patent that is very territorial, so you get a US patent that's effective here in the U.S. you get a patent in Japan, which you mentioned that's effective in Japan, so on and so forth.
So to answer the first part of your question, if all you're doing and all you care about is activity here in the U.S., sure. Getting a U.S. patent is probably good enough. You have no interest in other markets. You know, you never will. That's most likely fine. However, most companies I work with honestly either know they're interested in international markets or are early stage and haven't thought through whether they're interested in those other markets yet.
The problem there is if you wait too long, you can't get that same protection in other markets that you got here in the U.S. And by too long, I'm talking as little as one year. So if you file your first patent application in the US, let's say today, one year from today, you have to make a decision, am I going to file around the world or not?
Now there are ways to delay that a little bit up to 30 months, but you still have to do something. You have to file what's called a patent application piece in T Standing for Patent Cooperation Treaty and what that does, it's like making a reservation. You're saying I know that I'm interested in possibly filing around the world. No different than you're thinking about going to dinner on Saturday.
I know I'm interested in having dinner at Union Square Cafe on Saturday. That may make a reservation, so it's possible. Does that mean you're absolutely going to show up? You're absolutely going to file in all of those countries. It is not all you're doing is leaving the options open. Josh.
00:06:08:17 - 00:06:31:01
I'm going to channel you in terms of let's keep it simple. I'm I love sports. So let's let's use an analogy. We got offense. We have a defense, right? So what I'm hearing you talk about is what I would say is offense. It's my business. It's my intellectual property. Where is it that I want to do business today?
Where is it that I may want to do business tomorrow? And I've got to think a little bit of a longer game, whether it's 12 months, 30 months or beyond that, so that I can come up with an appropriate strategy. But let me ask you about the defensive side. So now I have global competitors, some of whom I may know about, some of whom are emerging.
And it might take me a while before I realize it, because I don't have I haven't filed that patent in their home market. My question to you as well, is there anything that prevents them from and I'm going to use the term violating my patent, in other words, basically stealing it, knocking it off and doing it in their market.
And if they're able to do that, because I didn't file proactively for protection, what's to stop them from selling into my home market where I do have protection, you know, whether it's directly like they set up a well, let's talk about different levels. One, can I stop them from, if you will, manufacturing or producing that product in my market, too?
If they produce and manufacture the product in their home market, what stops them from setting up a sales office and selling it in the US in three? The case that I talked about in my little opening comment where there's a subsidiary in their home market that buys it and then that subsidiary transfers that into the United States. In terms of my client
Let's talk about the defensive side for a moment and talk about what the issues are there.
00:08:16:21 - 00:08:39:09
You said something in the beginning of your question there about violating your intellectual property. I hear that from a lot of people. What happens when someone violates my intellectual property? If you've only protected here in the US and someone does something in Japan again, technically that's not a violation because you have no rights in Japan. That's a common misconception.
Now there are a lot of companies out there that will look to see what products are selling well in the US. Are they patent protected? Yes. Are they patent protected in my home country? No. Let me sell the same thing. There's absolutely nothing you can do to stop them from selling the same thing under a different name, different brand, whatever it is.
If you have not filed for patent protection in that country early on, when you think about sales or marketing or manufacturing, you want to think not only where are my sales going to come from, where are my activities going to happen? But what other markets might be interested in this product? Even if I don't get there now or if I don't think I can get there soon?
I don't want to give that market up to somebody else in case I am successful and I want to expand. So that's the first thing you need to do defensively. If you don't do that for whatever reason, technically anybody else can do exactly what you describe. Sell your same product in Japan. The way to stop that is you make an improvement.
You change your product a little bit. So now you get a new patent for your improved product. You protect that new product, the improved product improvement in Japan. And sure, maybe you're giving up the old stuff to somebody else, but that's the old stuff. You don't care about that anymore. You want the new sales for the new improvement to come to you because that's where your real profits are going to come from.
The old product sales price is going to be low. Maybe there's high volume, but you don't care because you're not going to be able to generate any profits out of it. You move, everybody transition. Everybody's something new. No different, keeping it simple. Think about Canon cameras, right? Every year they come out with a new camera and people always want the biggest test.
Regardless of whether the improvement is small or large, it's still an imperfect canon's going to throw their support behind their new camera, not the old version. You want to make sure that new version is what you're projecting all the time. When you're talking about subsidiaries, parallel imports, products not overseas coming to the U.S., it's really simple. In theory, what a U.S. patent does is it lets you stop others from making, using, selling or importing and importing is key, whatever it is that you wanted it.
So even if it's a subsidiary of a US company that's in Japan and they buy or manufacture products in Japan, that would not infringe your patent because you have no Japanese patent. They want to bring it to the U.S. where you do have a patent just by importing it into the country. That's an infringing act. You have technically some protection there, but maybe it's a big company, huge company.
You know, there are a lot of big Japanese conglomerates and things like that. Do you really want to be in litigation with that company here in the U.S., where litigation is expensive, where you have to go through discovery, where you might have to wait one, two, three years to find out whether you win or lose. Or would you rather have your patent rights in Japan so you can stop it at the source?
You can stop them, the competitor, from even making it there in the first place. And then there's never even an importation issue to worry about.
00:12:25:13 - 00:13:06:15
A clarification here. If I wanted to go down that litigation now, because it's it's being imported into the country, but it's being imported by the subsidiary of my US of a U.S. client, not by the manufacturer say in Japan do I go after would in effect is my customer in say hey you had no right to buy it over in Japan from my competitor and put it in here or do I do I go after that Japanese company and say you had no right to sell it to that subsidiary because you should have known that they were going to then import it in the US where I have protection.
00:13:06:23 - 00:13:28:16
Yeah, that's a great question, Jay. And honestly, you're going to have to go after your client, whoever it is that is actually doing the importation into the U.S. That's you. You can recover from that. So you can try to stop whatever happens in Japan. You have no Japanese patent. There's very little to nothing you can do about it.
Most companies I work with, most of my clients really don't want to be in the business of suing their clients if they can help it. It generates bad feelings. It might prevent future sales, all sorts of things. That's another reason why you are better off trying to stop things at the source rather than waiting for them to work through the system and get here.
00:13:51:16 - 00:14:16:01
Josh, let me let me ask you one more. And I you know, there's so many nuances here, but I think these are the kinds of questions that business people are thinking about. So let's say that I have an American client. They have a oh, stay within Japan. They have a subsidiary in Japan. They are I have pattern around certain equipment that they use in their manufacturing process.
So this is as an input to what my clients then sell. They manufacture in Japan using the equipment produced by my Japanese competitor that is identical or close to identical to mine because I never bothered to protect it in Japan. So this subsidiary manufactures their finished product using that technology and then imports it into the U.S. and sells it.
Do I have any recourse other than having gotten that pattern in Japan or now because we're like a two step. It's over and done with and there isn't anything I could even think of doing.
00:14:55:09 - 00:15:19:06
That's a real tricky area because when you talk about manufacturing overseas and then bringing it here to the US, it's incredibly nuanced. If you're talking about you have a patent here in the US on the piece of equipment used to manufacture and then somebody uses that equipment in Japan, brings it here. There's not really anything you can do about it.
Now, if you had a patent here in the US on the manufacturing process itself and a competitor to avoid Japan manufactured elsewhere and brings the product here into the US, now maybe you have a possibility of doing something, of being able to stop that. Likewise, if you have a patent on the product itself, like I was talking about, they manufacture overseas, they bring it here to the U.S. That's an importation of your patented product.
That's a problem for them. It's not an easy answer.
00:15:53:04 - 00:16:24:12
One more question. I think just to talk about the magnitude of this problem, then we'll move forward. So if I am that U.S. company and I am thinking about these issues, which are a lot of issues and thinking maybe the right answer is I've got to think about getting a broader geographic protection. A Typically, in your experience, how many different filings in jurisdictions potentially are you looking at?
00:16:24:22 - 00:16:53:03
Ha boy, that's possibly the best question you've asked today. Yeah, there is. You know, true answer to that. And I can tell you, when I started doing this 25 ish years ago, the answer was very different than it is right now. It used to be a lot of the companies I work with, especially in the pharmaceutical area, would file around the world 20, 30, 40 countries because they wanted to lock everything up.
But then we went through various recessions, various economic downturns. You had, you know, people looking, where do I cut my budget? It's, you know, where can I make more money here to be able to spend there. Now, most companies look at the major markets, right? So you figure the U.S., you figure throughout Europe, Japan, China, maybe Australia, depending on what you're doing, maybe Canada, depending on what you're doing.
And then any country where it might be very easy to manufacture whatever it is you're working with, those are generally the countries most companies I work with will look at. So whereas it used to be maybe 20 to 40. Now you're looking at 5 to 10 because again, if you think about it, you have your expense of filing your patent application and then getting your patents.
But not only that, every country where you have a patent to keep that patent in force, you're going to need to keep paying official fees to that country's government. Otherwise, the patent lapses that gets really expensive over time, especially as the fees go up for each successive fee you're paying. You really want to protect yourself. In the beginning to make sure you understand the lay of the land where the compared competition is, where competitors are.
But you also want to be flexible so that as things change over time, you're just not locked into your position. And you can say, hey, you know, I thought people might manufacture in Afghanistan. I got an Afghanistan patent. Nobody is actually manufacturing there. Nobody is in danger of manufacturing there. Let's drop that and get rid of that cost. On an annual basis.
00:18:51:05 - 00:19:26:17
Josh When people confront problems that are overwhelming, you tend to get that very famous fear in headlight look really sane. I'm paralyzed. It's so overwhelming. I don't even know where to start. So again, turning back to the expert here, given the magnitude and complexity of the issues we just talked about, how should you be thinking about it and what should you be doing from a process and action point of view to address the set of issues we talked about?
00:19:26:22 - 00:19:51:01
It all starts with having a strategy, a clear strategy laid out. You're going to want to understand what your product is or what your services then determine. Okay, what is our business plan? Where are we likely to sell? If you're making something, where are we likely to manufacture? Then you look at where is our competition likely to come from?
Okay, you go through all that analysis, then you need to figure out now that we know the competition and what they're likely to do. Where do we want to try to stop them from doing that? Keeping in mind again, that all of this costs money, so you have to keep your budget in mind as to where you think you're going to get the most bang for your buck.
And then the other wrinkle that I have not talked about yet is that everything that you might be able to patent here in the US, you might not be able to patent in other countries because each country has its own set of laws and patent laws, while often pretty similar around the world, have a lot of nuances and wrinkles to them.
I brought up the pharmaceutical issue before. If what I have is a method of treatment, I can get that here in the US. Many other countries I might not be able to protect that method of treatment. Is it really worth spending money to try to get a patent for something that really there's no reasonable basis to expect? I'll be able to get a patent.
00:20:58:06 - 00:21:26:16
Josh Given the magnitude of what's at stake here, can you talk about the impact that this has on a company? If they get it right and then the potential cost of just being frozen and saying, well, I'm just not going to take any action and that sort of that they will, if you will, the cost of not playing defense.
So what do you gain by playing offense and what could you potentially lose by failing to defend?
00:21:34:12 - 00:22:07:11
What you gain by playing offense is actually pretty clear. You gain access to markets. You gain not only access to markets, but essentially the markets to yourself. So you can command higher pricing, more profitability, lack of competition, all of those things that every business is looking for. You're now able to get that more markets in here just in the US on the defensive side, that's a little more difficult, but it's still pretty clear.
Again, it's a matter of competition. No business I know of wants to face competition if they can prevent by playing defense, by thinking about where is that competition likely to happen? You're able to ship others off the market so that if you want to do expansion activities in the future, you can if you want to stop importation around the world to compete with you, you can if you want to make sure that nobody else plays in your space, you can.
One example I like to use is going back to Thomas Edison, perhaps America's best known inventor in history, where one of his common practices was to look and see what people filed for patent offices around the world, where there was opportunity in other countries where they did not file and fill in those gaps. You have to imagine one or more of your competitors might be doing that same thing in Josh.
00:23:13:12 - 00:23:48:06
The other thing which I know you and I talked about before we recorded the show that I think is worth mentioning is that you're spending a nice chunk of change on your R&D, the return that you're going to get from that R&D is going to be impacted to a great degree, I would think, by your ability to protect what it is that you're innovating and developing versus, you know, doing half measures, which is going to severely cut that return on invested.
And is that a fair observation?
00:23:50:16 - 00:23:57:17
100% completely fair. And I've had that conversation with my clients more times than I can possibly count.
00:23:58:03 - 00:24:34:17
Now I'm that if you are a C-suite executive, whether I am running a business, whether I am the head of R&D or the general counsel, you know, whatever is relevant to a company, I've got to make this decision and always remind you folks that failure to make a decision is the same thing as deciding to do nothing. As I get clarity, as I move forward with confidence on how, you know, not just what to protect, but where to protect it on a global basis.
Talk about the the emotional impact on that decision maker.
00:24:39:15 - 00:25:01:05
Anybody who is running a business, who is a C-suite executive in a business, they're always concerned is the business going to be able to keep going on the way it is? Are we going to be able to maintain our profitability if it's a public company? Are we going to be able to keep shareholders happy and our price is high?
If you're not thinking about these issues, guess what? You should be. And guess what? You might be losing sleep over it. Why? Because you don't know what you don't know. You don't know what the unknown is. And you wonder where is the next hit going to come from, right? What's happening now? You don't know. Maybe you do know.
And then you start to wonder. Boy, I have a lot here that I need to be concerned with. I haven't locked up this. I haven't locked up that I haven't protected in Australia. I heard that my competitor is building a big manufacturing plant there. What do I do if you don't know what to do next? If you don't know who to talk to, you're probably going to lose a lot of sleep over those things and you're probably going to be getting a lot of questions the next day by others in the company.
Well, what's the plan for this? I sure hope that you have a plan, because if not, it's probably not going to be too good for you.
00:26:01:18 - 00:26:36:03
You've made a very compelling case for the need to take proactive action, to not put your head in the sand and to be very thoughtful in how you think through over time. What strategy around protecting your IP on a global basis you need to take. Having said that, can you talk a little bit about some tactical steps? So what is it that I really need to do to safeguard my IP on a broader global basis?
00:26:36:10 - 00:27:01:18
You need to have relationships with people around the world to be able to properly do that. Because, you know, I'm a U.S. attorney. I'm licensed to practice here in the U.S. Technically, I cannot file in Japan, I cannot file in Germany, I cannot file in Australia. I need local representation in each of those countries. Tactically, whether you are a lawyer, that's external counsel.
Whether you're internal to the company that's trying to do things yourself, you need to know who to go to because you don't necessarily want to just google lawyer in Germany and the first thing that comes up, you ask them, Hey, can you file my patent application for me? You know, who knows if they're any good? Who knows if they even do patent work?