virginia tech emba guest lecture
TRANSCRIPT
Legal Strategy and IP Management
David Orozco, J.D.
Associate Prof. of Legal Studies
FSU College of Business
@ProfessorOrozco
Strategy“the essence of strategy is in the activities—choosing to perform activities differently or to perform different activities than rivals.”
Porter (1996)
This also applies to legal activities.
IP Management (law & strategy)
Intellectual CapitalExperienceKnow-howSkillsCreativityCorporate Memory
Intellectual AssetsPrototypes DocumentsIdeasMemosDrawingsPrograms
Intellectual PropertyTrade SecretsPatentsDesignsCopyrightsTrademarks
Parr and Sullivan (1996)
???
5 Pathways of Legal Strategy
Avoidance Compliance Prevention Value Transformation
Bird and Orozco (2014)
3 Attorney-Manager Collaboration Models:Case 1. The Constrained Model
Manager
Attorney
Orozco (2010)
Avoidance
Case 2. The Repository Model
Orozco (2010)
Compliance
Case 3. The Legal Knowledge Model
Orozco (2010)
Prevention;Value;Transformation
IP AvoidanceZ-teca had to rebrand as Qdoba due to a prior trademark owner’s cease-and-desist letter after the restaurant launch
Poaching key executives/ scientists to replicate similar innovations
Large retailer freezing out small U.S. tool maker and outsourcing manufacturing to China
Retailer selling shirts that copy independent designer
IP Compliance Streaming media companies and venues working with copyright royalty societies like ASCAP and BMI
Training company executives on how to protect company trade secrets and investing in IT capabilities to prevent data breaches
Conducting due diligence/ compliance review in supply chain and mergers
IP Prevention Facebook licensing patents from Microsoft to fend off Yahoo! lawsuit threat prior to ipo.
Large tech. companies licensing patents from RPX to avoid patent troll lawsuits.
Tech. companies designing around their own core technologies to preserve freedom to operate
Starwood Hotels adopting state-of-the-art trade secret management program to fend of Hilton’s attempt to replicate the W Hotel brand
IP Value Creating a business unit with responsibility to monetize dormant IP assets (“Rembrandts in the attic”)
Apple’s tax strategy with intangible assets
Getty Images outsourcing royalty claims to third party law firm/ collection agency that requests smaller royalty fees to induce a quick settlement
IP Transformation Samsung’s strategic non-compliance with Apple’s IP Amazon’s licensing structure with fan fiction authors and copyright owners
Apple’s integration of design rights to achieve shape trademarks and out-licensing marks to 3rd party accessory manufacturers
Tesla open sourcing its battery patents Pharmaceutical companies extending lifetime of chemical compound patents by patent layering
Takeaways Legal strategy can be a source of competitive advantage
IP is a critical asset category for any company in any industry
Attorneys and managers working in teams offer the greatest range of strategic options
Legal strategy cuts across functional areas including: legal, marketing, R&D, human resources, IT, supply chain and compliance
Discussion and Questions
Sources:Bird, Robert C. and David Orozco (2014), Finding the Right Corporate Legal Strategy, MIT Sloan Management Review.
Orozco, David (2010), Legal Knowledge as an Intellectual Property Management Resource, 47 American Business Law Journal.
Parr, L. Russell and Patrick H. Sullivan (1996), Technology Licensing: Corporate Strategies for Maximizing Value.
Porter, E. Michael (1996) What is Strategy? Harvard Business Review.