The Perfect Portfolio

Six years ago, the United States changed its patent laws to reflect a global practice of a first-to-file system. Though some say it was a drastic measure, MKS Instruments’ Erik Saarmaa believes it has resulted in more of an evolution in how industry lawyers practice law.

When it comes to patent law for the products industry, it’s all about knowing how to strategically navigate the system. This came to a head in 2011, when the United States enacted new patent laws shifting from a first-to-invent to a first-to-file system, starting in 2013.

As severe as that sounds, “it’s not as drastic as one might think,” explains Erik Saarmaa, chief IP counsel for MKS Instruments, a global provider of instruments, subsystems, and process-control solutions for various products. MKS’ primary served markets comprise manufacturers of capital equipment for thin film, including semiconductor devices, process manufacturing, environmental, life sciences, and scientific research.

“What’s happened is that companies are trying to protect their ideas more quickly because they can’t rely on first-to-invent in the US anymore,” Saarmaa says. Though companies didn’t necessarily let ideas sit on the shelf for years before filing prior to 2013, there’s definitely an urgency that speeds up the process more. “It’s not an earth-shattering new thing,” he continues. “It’s more of an evolution of how you operate.”

In the technology space, this puts additional emphasis on finding people who have the expertise to strategically manage and file patents in a cost-effective manner. For lawyers such as Saarmaa, this means knowing how to develop the company portfolio so that its value increases under consistent cost pressures. Some companies manage this pressure through a combination of in-house work and outside lawyers and firms who have the technical expertise and a good bench.

For smaller companies, this can prove to be a challenge due to fewer resources and cash flow to protect IP. With the new patent laws, these types of businesses have to decide if an idea has legs, then invest in trying to protect it.

“I don’t know that there’s one silver bullet for the industry,” Saarmaa says. “I think cost concerns, value to the business, and technical expertise are just a couple of things that companies can consider to really make sure that they are developing a high-quality patent portfolio.”

This is where strategic thinking on patent-filing comes into play. Not all technical ideas are high-value, and some are more protectable than others. Having the technical and business acumen at an attorney’s table is crucial. This enables idea-vetting and a smarter way to commit resources and expenses to file patents and pay annuities.

On an international sphere, that could add up to spending $200,000–$400,000 in certain product spaces over the lifetime of the patent to protect it in various countries. Because patents have a twenty-year lifespan, the competitive landscape tends to change drastically in that time. In many ways, this change in United States patent law, which reflects the rest of the world’s view on patent law, necessitates an evolution of
more enforcement.

“We don’t know how things are going to play out there, but you have to invest now because you don’t know what you’re going to need or going to be using five or ten years from now.”

For Saarmaa, the first-to-file system creates synergies between each country. “We, the US, were a holdout, if you will,” Saarmaa says. “I think it makes a lot more sense to be consistent with everyone else, as opposed to trying to be different in that space.”

Moving forward, Saarmaa would like to see more improvements in dealing with non-practicing entities/patent trolls. Though it’s evolving and Congress and the courts are looking at the issue, there hasn’t been much that has happened to create enough certainty on how these kinds of issues will evolve, he says.

Saarmaa also stresses the need for the technical personnel in a company to effectively communicate and collaborate with the legal team. By doing so, IP lawyers are able to understand the significance and value of ideas outside of their department, and vice versa.

“If you’re able to understand some of the technology, then you’re able to home in on the real nugget, if you will, that is important and might have real value to the business,” Saarmaa says.

With the changes in patent law, a pure legal background isn’t enough to truly understand the nuances for what’s best for the company. It comes down to having an understanding of the market, the business side, knowing the company’s technology, and the dynamics of the industry. All of this, combined with effective use of available resources, distinguishes the best strategies for patent law in today’s ever-changing world.