The shift towards the knowledge economy has led many organizations to gradually make intellectual property a core component of their long-term strategy.
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Clairvolex
This has made companies build large patent portfolios but the need to realize maximum value from them has led to the outsourcing of patent-related activities. A typical patent application consisting of activities such as prior art searching; interviews with inventors; drafting background, specifications, claims, and summaries; preparing drawings, and the final review, modification or proofreading can be done by IP professionals in remote locations as long as the process is well-defined.
The activity under an offshore patent services unit demands specific skills and expertise, infrastructural suitability, cultural compatibility, established intellectual property structure in the country and a win-win contractual agreement.
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Spectrum of services
The fundamental requirement of the business of patent offshore outsourcing is the expertise and skill of the professionals delivering the services. The entire spectrum of work related to intellectual property includes preparing patent applications to IP commercialization.
Offshored IP services include:
(i) Literature and prior art searches including searching databases, conducting freedom to operate studies, patentability and patent invalidity searches;
(ii) Patent portfolio analysis and landscaping services including overlap analysis and the creation of claim charts, valuation modelling and competitive intelligence – services pertain to mining and licensing patent portfolios that require deeper experience;
(iii) Patent proofreading and docketing – patent paralegal services;
(iv) Drafting patent application and technical disclosure and help with prosecution, including writing a preliminary draft of a patent application, helping with drafting amendments and drafting complete technical disclosures for quick conversion into patent office compliant patent applications.
The quality of work also relates to the lawyers that do the work being trained in laws of the outsourcer’s country.
Another important issue is confidentiality. The significance of preserving client information cannot be underestimated. Breaches of confidentiality violate the Model Rules of Professional Conduct and are the basis of tort liability. Procedures and policies to protect confidential information to prevent illegal conduct is a core requirement.
Work-product privilege also has to be considered. The subject of practice of law is central to the work-product privilege or the fact of not being bound by the outsourcer’s legal practice when an offshore organization is interacting with an attorney or a law firm. It is important to consider whether patent offshore outsourcing aids the “unauthorized practice of law” that contributes in shaping the nature and extent of an attorney’s or firm’s monitoring and supervision.
Issues of conflict of interest also need to be avoided. Avoiding conflict of interest is a feature of professional conduct. It is always prudent to identify conflict dilemmas and reasonable to expect organizations to apply conflict standards.
When outsourcing, it is important to consider whether senstitive information is being exported. In the case of patent applications and prior art searches, any technical information provided or conveyed to a foreign person may require export authorization. Technical information may be central to a defence service requiring licence, thus making effective contract controls imperative in conjunction with the required export analysis.
It is also necessary to consider cultural compatibility with the offshoring organization, which ensures good processes at both ends and facilitates communication. A clear understanding of the project specifications, work progress, final deliverables and a written schedule decreases open issues.
The formulation of indemnification is critical as it involves understanding and determining liabilities carried by each party such as “Professional Errors and Omissions” insurance coverage.
Models for outsourcing
A fine distinction between offshore or overseas outsourcing and offshoring differentiates the two. Offshoring is the transfer of business function to a foreign affiliate like a subsidiary. A number of patent related services are emerging in respect to outsourcing.
One is the captive subsidiary, a wholly owned enterprise. Some foreign law firms have established subsidiaries and there are captive centres of technology companies. Another option is the joint venture, a collaboration between foreign and Indian law firms, most of which are law practice specific. Finally, there are third-party vendors that provide general research and analytics. These include set-ups established by US based attorneys which are domain specific in providing legal and IP services.
Factors such as the need to train lawyers, assure client confidences, the need for attorneys to review all work and take final responsibility for it are important and have helped patent offshore outsourcing become a key component of IP creation and maintenance.
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Dr Sushil Kumar is vice-president of Clairvolex Knowledge Processes, a Delhi-based legal outsourcing firm.
Clairvolex Knowledge Processes
3rd Floor NDIIT Building
Kalkaji
New Delhi – 110 001, India
Tel: +91 11 2371 6565
Fax: +91 11 2371 6556
Email: mail@clairvolex.com
www.clairvolex.com
