A Game of Patent Rights: Disputes and Solutions from the Past 60 Years

Written by Y.P. Jou, Chairman of InQuartik

April 24th, 2020 ‧ 10 min read

As World Intellectual Property Day approaches us, here is a reflection on how to turn the tables on information asymmetry with big data and artificial intelligence.

“Over the past thirty-five years, I have served in various fields, including technology industries, academia, law, and data science in the United States, Europe, China, Japan, and Taiwan. I have also worked extensively with patent search tools and patent management systems, and have been involved in patent activities including global patent search, deployment, prosecution, maintenance, litigation, licensing, trading, pledging, and portfolio management in a multitude of industries. Moreover, after retiring from Foxconn, for the last 16 years, I have been performing research, eager to solve the major problems surrounding patent commercialization. My hope is to create a new solution to break the deadlock and to turn the tables with big data and artificial intelligence.“

In 2000, The World Intellectual Property Organization (WIPO) accepted the suggestions of China and Algeria and named April 26 as World Intellectual Property Day. Commencing in 2001, World IP Day became known as a day for the world to become more aware of and to recognize the importance of knowledge, science, and the protection of intellectual property rights, along with creating a legal environment that encourages intellectual innovation and IP rights protection.

This year marks the 20th anniversary of World Intellectual Property Day. Although intellectual property laws can still be enhanced, the legal system is quite complete and does not require many improvements. Instead, the real concern is whether the newly emerging countries have fully understood the U.S. and European company’s patent strategies when it comes to the gaming industry, trade wars, and technology wars.

In other words, countries, and businesses that are caught up in trade wars, technology wars and market competition will continue to be accused, retaliated against, blocked, claimed, forced to pay royalties, or driven out of major markets, if they do not comprehend the crux of the most significant intellectual property problems and where the breakthroughs lie.


How Have the Past 60 Years of Trade Wars Affected Us?

Although it has been 546 years since Venice promulgated Patent Law in 1474, most countries have also established their patent laws. However, patent laws are usually only enforced the same as regular laws, instead of exercising their real potency, which involves taking the initiative and going against competitor countries and companies in trade wars.

Therefore, what needs to be discussed is the use of patents in trade wars; this type of activity first started in the 1960s. The U.S. made good use of their patent strength by first attacking Europe and Japan, followed by Taiwan, Korea, and Hong Kong in the 1980s, and then China after 2010.

As 60 years have passed, it is time for us to reflect on why most Asian countries and companies are still caught up in U.S. patent wars. Even though vast resources have been invested in applying for a large number of home country patents and U.S. patents, they still turn out to have little to no use. Even with rich patent assets, they are still being asserted, sued, and licensed, even becoming like an ATM for U.S. patents. However, Asian countries and companies struggle to identify the crux of the matter.


The Crux of the Problems Surrounding Patents in Asian Countries

The following are the crux of the patent problems faced by Asian countries:

  1. Failure to grasp the European and American companies’ patent ecosystems and their operational relationships in terms of organization, staffing expertise, business types, processes, and budgets. Besides, these Asian countries have also failed to identify and propose improvements to the current European and American patent ecosystems. Merely mimicking surface-level elements and failing to learn more about cultural value has resulted in the inability to transform.
  2. The lack of experience in litigation, licensing, trading, and pledging, as well as not possessing the relevant skills, experience, methods, and tools necessary for managing a patent portfolio throughout the entire patent lifecycle, has resulted in just having large numbers of patent applications, instead of increasing the market share, revenue, technological improvements, and other benefits.
  3. Most enterprises and research institutes start by applying for patents in their home countries; then, they translate them into U.S. patent applications, rather than having the perspective of developing for the U.S. market and monetizing the patents in the first place. In other words, patents applied by academia often do not incorporate any business purpose or strategic thinking, resulting in poor quality patents.
  4. Most Asian companies do not invest enough in basic and applied science or technology research. However, instead, they follow the lead in “product development” and “engineering improvement,” thus causing a lack of technological potential, along with running the risk of having low-value patents.
  5. The analytical thinking of Taiwan and China is both influenced and limited by the patent search and patent landscape analysis developed in Japan over the past forty years. The result? The inability to use and analyze patent data from multiple dimensions for more meaningful and innovative purposes.
  6. Most companies fail to take advantage of new technologies, such as combining big data, algorithms, and artificial intelligence, to develop innovative solutions. However, some patent solutions can instantly observe and analyze the key patentees and inventors that may have an impact on the operation of their enterprises from different dimensions, all while filtering out every patent asset related to the technology from the vast amount of data. Additionally, such solutions can also identify a large number of patents that have low-quality and low-value. The lack of patent solutions is often the reason why enterprises cannot effectively develop and produce high-quality, high-value patent portfolios.


Are Their Patent Solutions Truly Flawless?

Most Asian countries and their enterprises have not been able to figure out the deficiency of most U.S., European, and Japanese companies, universities, and research institutions. For example, the principles and mechanisms of the patent portfolios of European, U.S., and Japanese companies, the Patent Lifecycle Management (PLCM), and their quality and value metrics are inadequate. However, effective solutions have already been developed.

The reason why U.S., European, and Japanese companies are so competitive in terms of technology and patents is primarily due to the investment in patents and performing more research, in order for them to have at least 5%-10% high-quality and high-value patents.

A few of the “litigation-proof” quality patents will be chosen among these high-quality patents for patent infringement litigation situations. They will be used as financial benefits and reputational status spillovers for the rest of the low-quality and low-value patents, especially for U.S. federal court litigation or International Trade Commission Section 337 investigations to force counterparties to accept licenses or withdraw from the market.

In contrast, Asian companies are often intimidated by the high cost of litigation and choose to pay and surrender when they encounter lawsuits through fear. Not only has this problem not been resolved, but a new solution is also lacking.


The Importance of Innovation Development for New Patent Solutions

Lastly, I would like to elaborate on the crux of patent problems in Asian countries and companies from my past experiences, emphasizing the importance of research and strengthening the patent environment. I also would like to propose new solutions that I have proven and that I am already implementing; these solutions can be utilized by and applied to all sectors.

1. Basic and Applied Research

In Asian countries, except for a few large corporations and the academic and research community, the R&D of most corporations is only acting as a follower in product development and technological improvement. For such problems, I suggest that even though most enterprises are not able to conduct primary research, they can still use big data in advance to select topics precisely, along with applied research.

Additionally, they should make use of the Technology Readiness Levels (TRL) system, which was developed by NASA, and the agile development mechanism (SCRUM) which was developed by the U.S. software industry, to enhance product development and engineering technology in a disciplined manner to further enhance the value of patents.

2. The Training of Patent Professionals

Asian patent professionals are mostly engaged in basic patent-related activities, including patent search, prosecution, and maintenance. Less of their time is spent using scientific methods and mechanisms for patent deployment, portfolio management, and business operation (commercialization, monetization).

Furthermore, Asian countries need to stop prioritizing the patents of their home countries and move beyond the business framework of a patentee, patent agent, or patent engineer and nurture high-level patent professionals who are both multidisciplinary and multinational. Such high-level patent professionals include patent data scientists, patent portfolio deployment experts, patent quality and value analysis experts, patent risk control experts, patent asset transaction experts, patent litigation strategists, and patent workflow management experts who are not constrained by geography.

3. Big Data and Artificial Intelligence Are the Basics of Data Analysis

Asian patent professionals are predominantly engaged in traditional patent search, analysis, and the patent landscape, and less aware of whether or not the patent landscape is meaningful and useful for research, patents, and business activities.

Moreover, patent professionals do not often realize that his or her judgment can be affected by inconsistent patent quality. Those who fully understand the fact that big data, artificial intelligence, and data science are impacting and changing the way we search and analyze are few and far between.

In other words, the patent search, analysis, and patent landscape of the past did not serve a useful purpose when it comes to valuable analytics. It appears that the cause of this issue was a lack of scientific basis, methods, and tools to support it. The result? Wasting resources, time, and money on reports that are not meaningful or useful for impactful decision-making.

Thanks to big data, artificial intelligence, the integration of professional practices, and the many startups and solutions around the world, such as Apex Standards, Docket Navigator’s Litigation File Analysis, InQuartik’s Quality InsightsDue Diligence, and SEP Intelligent Analysis Reports; patent professionals no longer need to dig through large amounts of patent data for lengthy reports, they can now have more time and resources available for critical analysis in order to support operational decisions.

4. The Quality Insights of U.S. Patents

The quality of each country’s patents is maintained based on different patent office requirements, and it is almost impossible to gain insights into each patent’s quality without intensive research. Nowadays, with access to U.S. patent data, the startups, as mentioned earlier, can now timely provide comprehensive and accurate data for patent quality insights.

With a combination of artificial intelligence, software technology, and advanced user interfaces, patent professionals can have instant access to structured prosecution and post-grant proceedings data, to fully grasp the patent scope and any changes that may occur to each patent.

Additionally, patent professionals can now accurately gather all of the IP5 and WIPO family prior art and second-degree to sixth-degree prior art that may affect the validity of each U.S. patent. Furthermore, they can discover more relevant prior art through the semantic analysis of patent specifications and claims. These different levels of prior art can uncover the quality of U.S. patents on a large scale. They can be used to explain why around 75-80% of U.S. patent infringements and IPR cases are invalid, unenforceable, or limited in scope.

In short, artificial intelligence will revolutionize the litigation and transaction game for U.S. patents. Companies, regardless of geographical location, will no longer be disadvantaged in this asymmetric patent war when the quality of U.S. patents can be instantly identified.

5. Patent Portfolio Evaluation and Management

Patent professionals usually perform due diligence through traditional search methods, focussing on the number of patents. However, it is difficult to evaluate the patent assets of a particular patentee or technology, therefore making it harder for the patentee or any third party to make an accurate analysis of the patent assets from a decision-making perspective.

Artificial intelligence can support anyone—not just patent professionals—to instantly obtain a patent asset evaluation report containing at least 50,000 global patents. The evaluation includes patent country distribution, remaining life, legal status (pending, abandoned, valid, lapsed, expired), technology type, technology distribution, co-ownership, and inventor. Further evaluation metrics include patent application trends over the years, assignment data, pledging information, licensing (limited to registrants), reexamination, and patents under examination that are being challenged for eligibility/novelty/non-obviousness/certainty issues.

Finally, AI-powered due diligence evaluations highlight patent quality and value, and their relationship to the patent technology and patentee in the same field, including assertable targets, competitor patent development situations, and competitor citation history.

All of this critical information allows the patentee and third party to fully understand the situation of the patent assets and the importance of high-quality and high-value patent portfolios. Thus allowing them to stop wasting resources acquiring and maintaining a large number of low-quality and low-value patents.

6. Collaborate and Share Knowledge Without Leaving Anyone Out

In the past, patent professionals mostly worked on their own. They only shared information through meetings or by e-mail, resulting in inefficient patent operations, hard to consolidate information, and a generally substandard experience.

Today, a new generation of SaaS companies—such as InQuartik and its revolutionary Patent Vault—offers cloud-based integration and a secure collaborative workspace for patent work (you can think of it as the Google G Suite of the patent world.) This technology enables patent professionals to collaborate and share knowledge securely in the cloud, across countries, organizations, departments, and teams. It increases not only operational efficiency but also puts organizational memory and knowledge management theory into practice.


The world, as we know it is changing, people are changing, and working environments are also changing. To ensure innovation, growth, and development aren’t stifled, we must always be able to work, collaborate, and share ideas without boundaries such as geography and distance.

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