Research circles, communities of practice and IP consciousness

The following feature was written by Professor Ruth Soetendorp in response to two earlier posts.

A research circle as described in recent IP Finance postings (here and here) reminds me of 'communities of practice' (see Wikipedia definition) written about early on by, among others, Lave & Wenger. On first reading about communities of practice, it struck me how they were more prevalent in situations where there was risk of damage to human life or to property, for example between different professions in medicine, between the different professions and trades in built environment, but were not to be found between the professions and trades involved in the creation, protection and exploitation of IPR. Teaching about IP, at any level on any programme, I always begin by reference to confidentiality and trade secrets as 'the cheapest and simplest form of intellectual property protection'.

In 2005 the Intellectual Property Quarterly published "Intellectual Property Education—In the Law School and Beyond" in which I wrote:

There are examples of successful interdisciplinary learning projects, where science and technology students have had to study an aspect of the law (for example, environmental law, labour law, contract or intellectual property), which is key, but not core, to their primary discipline studies (61). But there are few, if any, initiatives that bring together creators of intellectual property rights with intellectual property practitioners and professional advisers. The closest many future inventors and innovators will get is an occasional ‘‘one-off’’ lecture from a patent or trade mark professional, and many do not even have that.

Interdisciplinary education initiatives are, of necessity, far more advanced where the safety of lives and property depend on the ability of professionals from different disciplines working successfully together. Interdisciplinarity is key in the education of surgeons and nurses, who work closely in an operating theatre, or builders and architects on a building site (62) The Joint Education Board of the Chartered Institute of Patent Agents and Institute of Trade Mark Attorneys is currently reviewing its foundation stage of training. More universities are expected to be accredited to deliver their foundation units. Perhaps this will be a catalyst for exploring interdisciplinary dialogue between future intellectual property practitioners and their future clients.

Some engineering academics are deterred from including intellectual property in their syllabus because they suspect that students might experience learning difficulties with assessments in a subject from another discipline. They fear this would result in lower assessment grades, which would reflect negatively on the work of the engineering faculty within the institution (63). This has not been the case in Bournemouth, where the Design Engineering and Computing faculty, and the Media School have noted no disparity between marks scored for IPR exam questions and those on other aspects of professional practice (64). Intellectual Property units are successfully completed on interdisciplinary programmes at undergraduate and postgraduate levels.

Learning the hard way?
Expecting graduates to wait until they start their careers to learn about how intellectual property operates in the workplace leaves them vulnerable.

A few years ago an undergraduate final year furniture design student wrote to a well known international low price furniture manufacturer. The student described his innovative project, and invited the company’s support. The company replied that they did not work with students. Six months later his item appeared in their catalogue. In four years of his course, no one had flagged up to the student the importance of confidential disclosure. A patent agent recently commented:

‘‘What I suspect is incontrovertible is that the more aware of the basics, the less likely engineers are either to throw away valuable assets for themselves or their employers".

Footnotes
61. Washington University ‘‘students [from the different disciplines] can learn to communicate together, to maximise their respective skills, and to realise there are no clear dividing lines between the disciplines’’, Prof. Maxine Lipeles, holder of a joint appointment in the School of Law and the School of Engineering, Washington University (http://news-info.wustl.edu/sb/page/normal/78.html).
62. See J. Lave and E. Wenger writing on ‘‘communities of practice’’, e.g. Situated learning: legitimate peripheral participation (Cambridge University Press, 1991).
63. M. Dodridge, ‘‘Learning outcomes and their assessment in higher education’’ (1999) 8 IEE Engineering Science & Education Journal 162–168.
64. R. Soetendorp (unpublished, Bournemouth University, 2002).

When is the right time to call in the strategists?

Circulated this morning under cover of BrandChannel is a short paper (5 pages, of which pages 2 to 4 carry the meat) entitled "Your Brand is an Asset? Show me the money" by Stuart Leo, Director of a "boutique strategic marketing company" in Australia with the splendidly attention-grabbing name of Blirt! The thesis is that, in a downturn, your brand can bring you money.

Hoping for the revelation of some deep truths, I opened the document and was, as ever, a little disappointed. Literature such as this is part-exhortatory and part promotional. It seeks to goad the brand owner into action. There seems to be a huge disconnect between this sort of material and the usual reality, when the exciting idea (in this case (i) sell, (ii) license, (iii) co-brand or (iv) promote) hits the buffers. In most cases the medicine is better than the patient: the brand is poor, the goods or services to which it is attached are not thriving, and so on. By the time the brand owner starts seeking external advice, he has often tried and failed to do one or more of the four things which the author suggests, which narrows options still further.

If there is a moral to all this, it's that the best time to call in anyone -- brand gurus, marketing and advertising experts, business consultants -- is early, when the going is good and a business can afford what many regard as a luxury. It's also the time when the most options remain open.

Trade Secrets: Front and Center?

Permit me to add a few additional thoughts to the post of 3 April by Jeremy Phillips, "Research circles: new and useful"? Jeremy reported on what Jonathan Murray of GE Healthcare describes as a new innovation model called "a research circle." I found Jeremy's skeptical conclusion to be of most interest, in which he observed that "I hadn't realised that the concept was new, and it's certainly not inventive. The real challenge, though, isn't conjuring up the 'research circle' as a new model but in creating the right atmosphere of trust and respect that will enable it to function successfully, not just when it's achieving positive results but when the collaboration is doing no more than eliminating the negatives."

One view of the Open Circle

I would like to push Jeremy's comment further. In my view, one of the biggest failures of the legal education of IP is that it has largely ignored the "trust and respect" scheme of trade secrets as an integral part of IP thinking. This means that IP legal education focuses on the "traditional" forms of IP protection--patents, trademarks and copyright--which can be roughly characterized by disclosure and transparency, elaborate statutory schemes and international structures, and, in part, systems of registration. As such, the focus is proprietary in the purest sense in that these rights are presumably good against the entire world (at least as bound by the relevant territory) and the relationship between parties is morally neutral. If anything goes wrong between the parties, they look first to contract and in a lesser degree to tort to seek remedy.

In such a world, there is no sustained place for trade secrets (or whatever synonym you choose to call it) protection, which is characterized by lack of public disclosure and the centrality of trust between discrete persons, where the right can be lost forever by either disclosure or independent invention, where there are only rudimentary forms of statutory protection and virtually no international structures. In a word, trade secrets is a form of protection of human invention and creation which is in many ways diametrically opposed to the traditional IP rights.

The neglect of trade secrets carries over into MBA and management education, despite the fact that the best evidence that we have seems to show that trade secrets may be no less important than the traditional IP rights as a way of protecting inventions and creations. Anyone on the ground knows this, but those few courses that attempt to genuinely integrate IP into an MBA setting for the most part are driven by the categories of analysis and discourse borrowed from the law school treatment of IP. Indeed, my own MBA teaching experience shows that the students find my treatment of trade secrets and trust to be the most unexpected, and in many ways, most useful part of the course.

Seen in this light, it less perhaps less surprising that the report on "a research circle" seems to have neglected an emphasis on the trust aspect of innovation and development. Without any meaningful legal discourse on IP and trust in legal eduction, and only sporadic treatment of the subject in MBA education, it will take a rare person indeed to successfully integrate the concept into the analytical structures that he or she may have learned in law or business school. There is hope, however. The current economic crisis may well force both legal and management education to a long, hard look at themselves. If so, one result may be that the treatment of the trade secret and trust paradigm will be front and center in such curricular changes.

Trade secrets: secret no longer?

IP security and an absurdly tight deadline for response

An email has been sent today by the UK's Intellectual Property Office to an circular list named as "Policy". It reads as follows [with my comments in red]:

"UNCITRAL - Security Interests Working Group

Dear Interest [am I alone in not liking to be called 'Interest'?], 

A working group of The United Nations Commission on Trade Law (UNCITRAL) was established in 2002 to develop "an efficient legal regime for security rights in goods involved in a commercial activity". The Commission subsequently noted that intellectual property rights were increasingly becoming an extremely important source of credit and should not be excluded from a modern secured transactions law. The Working Group on Security Interests has held a number of sessions to discuss the issue [one of which resulted in the establishment of this weblog] and is developing an Annex to the UNCITRAL Legislative Guide on Secured Transactions dealing with security rights in intellectual property [an internal search of this blog will reveal numerous items and documents related to this initiative]. The Annex will discuss how the principles of the Guide apply where the encumbered asset consists of an intellectual property right. The latest draft to be discussed at the next Session beginning on 27th April 2009 in New York can be found here. [No it can't. Readers have complained that this link doesn't work. All the papers relating to the IP Annex to the Guide seem to be available here]

If you would like to comment on the draft Annex before the 15th session or require further information, please e-mail policy@ipo.gov.uk no later than Friday 17th April [this means just 14 days, inclusive of two weekends one of which is a major holiday, to get one's head round the complex issues and then articulate some sort of response; not much time, is it?]."

I'm going to be effectively out of action between 8 April and 17 April, but I do hope that readers of this blog will be able to coordinate some sort of response.  Can I suggest that readers who want to be involved, but who have not yet identified themselves, should post their names and email addresses as contacts below this post, so that someone can contact them or they can at least contact one another.

'Research circles': new and useful?

Under the heading 'Research circles' tech transfer model speeds IP commercialization', this week's Technology Transfer E-News circular writes that Jonathan A. Murray (general manager, Cross Business Programs, GE Healthcare) is successfully using a new innovation model he calls ‘research circles’. A research circle is

“a group of people who have agreed to collaborate together and agreed to follow a set of rules of how to work together as a society”.

Participants, often with different education and research backgrounds, can share information under an umbrella (non-disclosure agreement) NDA, allowing them to tap into IP and expertise from the best minds in a particular field without regard to typical boundaries. Details can be found in an article on the research circle model of university-industry research cooperation in the March issue of Technology Transfer Tactics. 

I hadn't realised that the concept was new, and it's certainly not inventive. The real challenge, though, isn't conjuring up the 'research circle' as a new model but in creating the right atmosphere of trust and respect that will enable it to function successfully, not just when it's achieving positive results but when the collaboration is doing no more than eliminating the negatives.  It will be good to learn how GE Healthcare is doing this, since the company has probably gained a good deal of experience and know-how if it's got the point of going public on the 'research circle' notion.  One further thought: circles of this nature may prove socially, emotionally and politically more comfortable than just looking to buy in or outsource the sort of

Horse race sponsorship: what is central to centralised deals?

Earlier this week BrandRepublic published a piece by Ed Kemp entitled "Horse-racing industry targets centralised sponsorship". I'm not usually interested in horse-racing, but I'd never heard the term "centralised sponsorship" before.

According to the article, written from London, England:

"Key players in the horse-racing industry have called for a radical shake-up of its sponsorship structure to allow it to compete with other mainstream UK sports.

Football, rugby and cricket have all benefited from centralised marketing functions, in which the sport's governing body sells league or competition sponsorship packages, and clubs seek individual deals.

Speaking at an industry event, ... experts argued that the ability to offer sponsorship packages across multiple events would help prevent the loss of blue-chip backers. Last year, Vodafone ended its long-standing title sponsorship of the Derby, leaving the event struggling to secure a partner for this year's festival.

Peter McNeile, director of racing at Cheltenham Racecourse, said he believed that individual courses should always be able to negotiate their own sponsorship deals, but added that the industry needed to be 'bold enough to offer bundled rights'. He also warned that courses may have to suffer initial setbacks to implement a different sponsorship structure. ...

Jon Stainer, business development manager at Sports Marketing Surveys, explained how cricket had capitalised on a centralised set-up. 'In cricket, the ECB's Commercial Partners programme promoted loyalty, while title sponsors received reciprocal rights across competitions. It also helped raise consumer awareness of these competitions, according to our research,' he said.

... McNeile claimed that Cheltenham Racecourse, along with horse-racing regulator The Jockey Club, would be ideally placed to lead the process of developing a centralised body to sell bundled sponsorship rights. He added that he hoped other racecourse operators would embrace the concept".

This generated a couple of random thoughts:

1. Not much has been said about the sponsors. The notion of "he who pays the piper calls the tune" is something that brand owners are pretty comfortable with -- and it is their money. While some sponsors may be motivated by a deep affection for equestrian sports, others are moved by issues such as value for money, profile-raising for corporate and goods/services brands, co-branding synergies etc. Why should they want to change> The notion that a change might be a bumpy ride in the first few years suggests that there may be some sponsor resistance.

2. Centralisation of sponsorship functions may just have a competition issue. If particular types of deal are only available from one source, there may be a dominant position which leads to market abuse. And if centralisation is effective as a result of the concerted activity of the different segments of the horse-racing industry, the competition authorities may be tempted or induced to investigate.

The WIPO Information Meeting on IP Financing: some notes

The IP Finance weblog would like to offer its sincere gratitude to Baskut Tuncak for preparing the following notes. Baskut is a fellow with the Center for International Environmental Law (CIEL) in Geneva; he works in the IP, Trade and Sustainability department, looking at Tech Transfer of Environmentally Sustainable Technologies. Baskut writes:

"WIPO held an information meeting on IP Financing on 10 March, 2009 in Geneva, Switzerland. Director-General Francis Gurry began the conference by identifying what he believed to be the principle reasons for considerable difficulty in developing IP Financing: (1) the lack of a clear connection between the security and the underlying asset, and (2) the complexity and lack of transparency in the IP system results in distrust for the intangible economy.  

Mr Lorin Brennan (of Grey Matter LLC) further elaborated that, in the context of UNCITRAL’s efforts to harmonize international secured transaction laws, considerable difficulty is presented by legal systems utilizing a pledge-possession based property system. Specifically, Mr Brennan noted that, without IP filing mechanisms in place, IP financing is impossible in nations with pledge-possession based property system. 

Mr Brennan identified several areas requiring further development to develop a robust, global IP Financing system: (1) Draft a generic law of financing that is applicable for all types of IP under all current international IP related conventions; (2) Coordinate priority systems in IP financing with priority systems in debtor financing; (3) Refine IP valuation methods from the Basel 2 method currently used; (4) Increase the strength of IP laws and the reliability of registries; (5) Integrate underwriters and title insurers to help increase confidence in IP securities. 

Responding to Mr Dalindyebo Shabalala’s request for clarification, Mr Brennan explained that he was not advocating for, or against, harmonization of global IP laws.
Professor Neil Cohen, author of the IP Annex to the forthcoming UNCITRAL Legislative Guide on Secured Transactions, explained that the Guide takes a functional approach and will have a broad scope, applying to both tangible and intangible property. For both types of property, the Guide will cover the relevant conflicts of law issues. However, according to Prof. Cohen, it is presently unclear to the drafters as to whether the law of State in which the asset is located (as is the case with tangible property), or the law of the State in which the grantor is located (the case with intangible property) ought to apply to IP, due to the geographic limitations of IP laws.

Sprios Bazinas, Secretary of UNCITRAL Working Group VI, spoke of the need to have robust valuation methods in place. He also explained the need to harmonize insolvency laws along the way to developing a viable IP Finance market. Accordingly, the Guide’s IP annex will have a section devoted to insolvency issues. However, harmonization of insolvency laws requires coordination of two different UNCITRAL working groups.  

Regrettably, very little attention was placed to two key issues. First, an in-depth discussion of how the current financial crisis is impacting both current and future efforts to securitize IP assets was sorely missed. Second, and perhaps on a related note, while numerous commentators acknowledged the difficulty in valuing derivatives, no discussion was devoted to current IP valuation methods, auctions or otherwise".

The presentations of the various speakers may be accessed here.