Editorial: So... What's IP

By Len Monheit

Articles appear periodically in print publications about the value of intellectual property (IP), how to secure it, and a lot about the process and pitfalls. The general guidance is that having an intellectual property portfolio is valuable, and those who ought to know claim that IP’s value is only as much as you intend to protect it. In an industry where a secure IP position is difficult to establish, and where around every corner, someone is waiting to take advantage of a lack of vigilance, taking the high road is an expensive option with all too frequent unclear rewards, an environment that must change for some of the research and new capital investment that is required to take this industry to a level of respectability and maturity to be justified. The other option cannot be contemplated, that free-for-all where fringe players liberally use the ideas and work of others for significant material gain – often without a direct investment or contribution to the industry as well.

Scanning headlines and corporate communications one frequently sees examples of allegations of patent violation. Most frequently, this takes the form of a company using or buying a small amount of a protected product, mixing it with other material, lowering material costs, and claiming the entire material to have the benefits attributed to the patent protected material. In these cases, there are obviously multiple knowing violators of business principles as well as the law. At least one European ingredient company diligently enforced its position for years using economic analysis to determine exactly hoe much material was being bought from suppliers infringing its position, and other ingredient suppliers appear to be poised to take similar steps.

But there are misdeeds both on the buying and supplying side that allow these practices to be so lucrative – and prevalent. And the challenge of proving patent violation is sometimes a less than clear one. Industry as a whole gets bombarded with the ‘he said, she said’ mentality and it becomes very confusing to determine exactly who is right and to what extent a patent applies. And in fact, some in the industry are even overheard saying,” Here they go again,” as if tired of hearing about these fundamental battles.

This entire issue is perhaps another example of where a more transparent industry would assist all of us in making better decisions. Raising the baseline understanding of what the IP process entails and what IP means and does not mean is critical, as well as visually displaying the IP position of suppliers and manufacturers. Ideally, this information should also flow to retailers and others so that they know which companies are investing and which not, to better understand the products they promote and their attributes. Countering this approach is the masking all too typical of a competitive environment. Displaying too much information promotes the abuse of it. (One ingredient company is so afraid to disclose information to competitors that they are challenged with the very fact of presenting any technical/formulation information on their website.)

If we dismiss this dialogue about patents and allegations of patent violation, we serve only those interested in devaluing the process. On the other hand, frivolous announcements and using media as the battleground to present these allegations does not serve either. (and we’ve seen both sides of this – frequently). It becomes much simpler after the court has ruled, and perhaps all of these court rulings should be clearly presented and archived.

One aspect of this discussion that must be clearly understood is the economic driver. Until these less than savory practices of IP abuse do not represent a financially lucrative opportunity, the behavior will persist. Similar to the issue of borrowed or stolen science, until these practices are financially discouraged, rather than encouraged, they will prevail. This means, in the absence of efficient legal enforcement, then at store shelves and in homes, behavior must change, meaning a critical, pivotal role for retailers as gatekeepers (and for the media as information disseminators).

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