Translation Value in Managing Global Patent Portfolios

Matthew SekacWritten by Matthew Sekac, Senior Director at Park IP Translations, the following article appeared in the 2016 Global IP Directory published by CTC Legal Media, The Patent Lawyer Magazine and The Trademark Lawyer Magazine. The article, Translation in Managing International Patent Portfolios, discusses the valuable role translation plays in managing global assets.

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International patent protection continues to play a role of escalating importance in the worldwide marketplace.  Data from the World Intellectual Property Organization (WIPO) indicates a sustained trend of rapid growth in worldwide patent filings, with a growth rate of 9% in 2013 following rates of 9.2%, 8.1%, and 7.6% in the three previous years.

International patent positioning is a major consideration for organizations both large and small.  In a 2012 report to Congress (International Patent Protections for Small Businesses), the USPTO observed that “for US small businesses trying to compete in global markets, securing patent protection overseas can be a critical precondition”.

The professionals tasked with developing, managing, and asserting their organizations’ patent portfolios face a diverse and complex set of interrelated responsibilities. New applications must be drafted, filed and then seen through to grant.  Monetization of granted patents often requires the negotiation and implementation of license agreements.  Litigation may be required to enforce patent protection against infringing parties; and organizations must always be diligent in managing the risk of infringement suits brought by their competitors.

In many organizations these roles are discharged individually by patent professionals dedicated predominantly to specific functions. This includes both in-house personnel and outside counsel resources, each working to accomplish a particular goal—some do “prep and pros,” some manage licensing, others focus on opinion work or enforcement activities, and still others are brought in to litigate.

Each individual has a job to do, but a patent department’s unifying objective is to advance the organization’s business interests by executing a cohesive patent strategy.  The success of that strategy depends on the successful execution of its component functions, and the success of each function often depends on the successful execution of the others.  Poorly drafted patents may prove unenforceable in litigation, for example, while high-quality patents may fail to add business value if an organization’s licensing and enforcement activities are ineffective.

In crafting a strategy that effectively unifies the execution of related but distinct objectives, firms benefit from finding opportunities to consolidate the acquisition of resources that everyone needs.  This is the point of procurement departments, but expenditures on many critical services fly under procurement’s radar, and patent-related translation is a good example.

Translation can play an important role in the success of nearly all activities related to managing an international patent portfolio, for example:

  • Foreign patent filing and prosecution. Filing patents in non-English speaking countries usually requires translation, and accuracy is paramount.  Most foreign-language patent offices examine only the translated text, and during litigation there is normally no recourse available to the original application in the event that substantive translation errors are found.
  • Licensing negotiation and agreements. Licensing specialists conducting cross-border negotiations may require translation of patents belonging to competitors or even their own organization in order to fully understand the strength of their position vis-à-vis the scope of the issued text in each country.
  • Freedom to operate analyses. In assessing the viability of a prospective acquisition or new product launch, patent attorneys may wish to investigate whether a patent family has retained the same scope of coverage throughout prosecution in multiple key markets.  An application might have been amended during prosecution, or material translation errors might compromise prospects for successful enforcement.
  • Enforcement, discovery and litigation. Those charged with patent assertion overseas must be confident that the issued text of their patents is in line with their expectations.  Should litigation against international counter-parties become necessary, discovery may generate large volumes of foreign language material that must be evaluated for responsiveness and then translated.

Translation for these purposes requires a high level of specialized expertise.  Patents are some of the most complex legal instruments involving sophisticated technical subject matter.  To accurately capture the precise scope, meaning and intent of the source, translators require three layers of advanced competency:

  • Native fluency in the target language and advanced proficiency in the source language.
  • Technical/scientific. Advanced training and education in the applicable technical/scientific field.
  • Patent-specific. Patent language is highly specific, and the nuances of patent terminology differ across jurisdictions.  Distinctions that seem subtle to a layperson can materially impact the legal interpretation of the text.  Translators must be extremely well versed in the applicable drafting conventions as well as the precise meaning and legal implications of key terminology.

Properly credentialed translators are a scarce and valuable resource, but access to qualified resources is only part of the story.  Translators should be carefully evaluated by skilled project managers based on the needs of specific projects, and deployed as part of a documented quality assurance process with multiple layers of quality review.  Robust systems are critical for measuring and monitoring quality performance, as are formalized procedures for issue resolution and feedback management.  Specialized technology should facilitate everything from workflow and resource management to quality assurance, terminology management, data security and reporting.

Despite its pervasive importance, many patent departments engage the need for translations reactively and at the point of need.  They leave translation sourcing decisions to individuals who encounter the need downstream.  As a result, they end up buying from many different providers, with varying prices, at the discretion of uncoordinated parties both internal and external.  We have encountered firms that buy translation services from literally dozens of suppliers.

These firms dilute their buying power by spreading it thinly across each vendor. There is little control or high-level transparency into service levels or work product quality, and it becomes extremely difficult to gather data on translation expenditures across the organization.  Budgeting is complicated by inconsistent cost structures. Lines of accountability are unclear or nonexistent.

At the same time, it’s not hard to see how firms find themselves in this position.  Prosecution attorneys and their staff are focused on ensuring that applications are prepared, duly filed, and granted in what might be dozens of countries worldwide.  So they often let their local agents manage the translation piece.  If they find themselves requiring a one-off translation of prior art or an office action, a paralegal or administrator might bid the project out to a few vendors.  If outside law firms handle some of the prosecution workload, they might have their own associates or translation providers.  Litigation is probably handled through one or more outside law firms who farm translations out to another set of suppliers, while licensing specialists and attorneys doing opinion work seek out yet another resource.

Translation in this kind of scenario is treated as a commodity—an inconvenient cost of doing business that can be dealt with whenever it comes up.  But in reality translation is a specialized, professional service upon which a tremendous amount of money depends, where small errors can have major adverse consequences.  Given that, international patent departments can realize an enormous benefit from taking control of their translation needs and centralizing their purchasing decisions strategically from the highest level.

By consolidating their spend, organizations consolidate their buying power instead of spreading it across a large number of providers.  This means greater negotiating leverage and lower costs.  It also empowers organizations to demand higher levels of service that take advantage of shared requirements across various purposes.

Costs will also be consistent and transparent, simplifying budget and forecasting efforts.  Partners with robust reporting and analytical capabilities can also deliver comprehensive visibility into annual translation expenditures and aid in rendering filing decisions by providing forward-looking cost estimates for upcoming applications.

Taking control is achievable.  Organizations should start by canvassing their patent departments to understand the full extent of their translation needs as it applies to each portfolio management function.  They should endeavor to quantify their spend to the maximum extent possible.  They should investigate any pain points or qualitative deficiencies in their existing procedures.  Finally, they should seek high-level engagement with savvy providers that are able and willing to understand their requirements on a granular level, then deliver a complete suite of services with flexible workflows tailored to suit those needs.

2016IPPROGLOBALDIRECTORY

2016 Global IP Directory, Importance of Translation in Managing International Patent Portfolios

 

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