The most attractive of its advantages and uses is that it is very cost effective. The charges are not minute or time based and there are no set up fees either. You only need to keep paying a monthly fee. This is quite what people have been waiting for a really long time.

Another very important useful thing about VOIP is that you can use it from absolutely anywhere on the planet, as long as you have an active internet connection. Since you are not tied to a phone jack you can operate from anywhere.

VOIP is used extensively for video conferencing these days in place of the regular conference calling. To keep it cheap, you can also choose to hold an audio conference without the video but with text messaging and the ability to share documents. Most young businesses indulge in this as it is very cost effective and all the major purposes are served through this VOIP facility.

The situations regarding conference calls and also that of basic long distance phone calls are going to change completely in the future because of the introduction of VOIP and the changes VOIP has made in the landscape and functioning of the telephone services.

With time, the use of a land line phone for a long distance call is going to become obsolete. Broadband will gain recognition and popularity and so will VOIP along with it. After a few years VOIP will become as common as the telephone. Also with better portability of the options of soft phone and ATA adapters and common usage of VOIP will add to its popularity.

You may wish to read more at: Requirements for VoIP at Home or Office and Skype Problems and Solutions

Joe, a reporter, has been travelling around the world for more than a decade now and has extensive experience in many fields. Now he has a blog along with other article writers. To know more about him, do visit: Random Rants

Is it important where the company is located?

Perhaps not, if the service provider is located in the same region or country as you are. More often than not, you will get a delay in your call. A short delay before hearing a OK can make all the difference in your sales talk or discussion. You may be able to eliminate some providers just by looking at their areas of service. If you want to make international long distance calls, VoIP service is definitely the way to go. All internet IP-Telephony providers publish their international long distance rates on their website, so compare them in order to find the best deal. Rates vary by IP-Telephony provider, depending on the country you are calling.

Are you often on tour?

If you want to call when you travel, choose a VoIP plan that offers a free software phone. This software runs on your laptop, and allows you to call through your VoIP service account. Many companies charge an extra fee for a software phone service.

Do you need unlimited calls?

You have to decide between unlimited local and long distance service, or a limited amount of minutes per month. You may also need to consider international long distance calling. Some service providers will give you a local phone number which can be used like a normal phone line.

Quality of service

One of the foremost criteria is the quality of service provided by the IP-Telephony provider to make sure to get crystal clear voice quality. Moreover, high speed Internet connection should also be available for transmission of your calls. You will need a good broadband Internet connection IP-Telephony provider.

Add ons

VoIP services has some value added features like three way calling, call routing, fax capabilities, call filter options, teleconferencing, videoconferencing, call waiting, and return call. They provide you with the facility of forwarding the call to a particular phone number and gives you a busy tone and play a message. Some services may seem to be cheap but they may lack in such essential features. Therefore, you need to check the offering and select the one which best fits to your needs.

Jim Francisto
has a master degree in IT and is a technical writer and business consultant.
Voip Phone Services
Voip Providers
Voip Reviews

The SBA is an independent agency of the federal government and its purpose has remained the same since its creation in 1953. According to their website the purpose of the SBA is “To aid, counsel, assist and protect the interests of small business concerns, to preserve free competitive enterprise and to maintain and strengthen the overall economy of our nation.” The primary way in which the SBA does this is not by providing grants, but by administering low interest loans, or loan guarantees, which give small business owners like you access to start-up money from private lenders all over the nation. These are loans that you might not otherwise be able to get without the guarantee from the small business administration. The SBA does not directly provide you with small business financing, they are an intermediary and they contract with private lending institutions in every State. A loan guarantee from SBA gives a bank the added security it needs to lend you money. If the borrower’s business doesn’t get off the ground as quickly as planned and the business ends up defaulting on the loan the SBA will repay all or part of the loan – usually about 40% of the loan will be guaranteed.

This type of financial assistance may not be as good as free grant money, but if it is money you can actually get your hands on reasonably quickly, on decent terms, and the repayment schedule can fit within your budget, then it’s a great deal and probably your best option as far as financial assistance from the Small Business Administration. If you need a line of credit at any point in your business start-up or expansion, be sure to check out these SBA resources. Keep in mind that even if in the past you have been unable to borrow money elsewhere, it doesn’t mean you won’t be able to get business financing now. A loan guarantee from SBA will help you secure financing when it would otherwise be unobtainable based on your credit, perceived ability to repay the loan and other factors. They also have programs and ways of streamlining the application procedures necessary to provide financial assistance to the small business community.

This article was written by Michael Marlowe, chief editor of www.GovernmentPro.com -a new site dedicated to providing non-biased information about government grants, loan guarantees, cash benefits, financial aid, unemployment, and other government and private financial assistance programs. Visit the site to read one of the newest articles Finding Grants And Free Money You Qualify For

Unless you’re independently wealthy, your financial support will come from outside sources. This financial support can be either from a loan, from banks or family and friends, or an investment resulting from the sale of stock in the new business.

Most entrepreneurs finance the early start-up stage of their business with personal savings. Service and Internet-based businesses, particularly, don’t require much capital and are often started with just the personal savings of the president and spouse. Personal borrowing from a bank is another possibility. Of course, this loan will have to be secured with a personal guarantee.

Other sources of financing are family, friends, and close business associates who are brought in as investors. You offer them the opportunity to buy a share of your company. With all investors, you should have formal, legal investment agreement to prevent disputes in the future.

There are many federal, state and local financial programs intended to encourage people to launch new businesses. The best place to start is to either contact or go to the web site of the U.S. Small Business Administration and get a listing of their programs for small start-up businesses. You’ll be able to get a description of each program and resources for each individual state.

Venture investors, whether individuals or venture capital funds, make their money by investing in start-ups. They usually have a lot of money available, but they are also very selective. There are three types of venture investors:

1. Individual venture investors, also known as “angels,” are wealthy individuals looking to invest personal money in new ventures. One of the advantages of turning to individuals is that they often decide quickly whether or not they are interested, without the bureaucracy or extensive investigation of more formal investment groups. On the downside, locating enough interested individual investors to finance your start-up can be difficult.

If you decide to approach individual investors, work with a knowledgeable lawyer completely familiar with the government regulations involved in this type of investment.

2. Institutional venture funds are usually limited partnerships in which the bulk of the money is supplied by passive limited partners, such as insurance companies or corporate retirement funds. The portfolio is managed by a general partner or group of general partners. These partners or groups have lots of money and because they are in the business of financing start-ups, they can be a valuable source of experience and expertise.

However, the process is very slow as the funds carefully examine all factors and risks. In addition, venture capital funds drive tough financial deals on issues such as determining what they will pay for your company stock. When you approach a venture fund, don’t appear desperate for money, because you may pay dearly for it.

3. Corporate venture investors are divisions of large corporations usually looking to invest in start-up companies in related business areas. One major advantage of raising money from corporate investors is that in addition to providing money, they can provide both technical and management expertise, and because they have goals other then pure financial gain, they may not drive as hard a deal as venture funds.

The major drawback: Corporate funds often want to eventually gain control of the company in which they invest, a condition you find unacceptable.

Your company will probably need some kind of track record before you should think about selling stock to the public. However, many start-ups have gone public successfully very early in their corporate lives.

Raising outside financial support for your company is a sales person’s job. Forget about being president of the company, an innovative design engineer, or whatever previous positions you held. You are now a salesperson, and what you are selling is your business, specifically, your idea for a product or service, your management team and your knowledge of the market.

Selling is a process with well established techniques. There are many books, audio programs and educational seminars that explain these techniques, from developing leads to planning and delivering your sales pitch to answering objections and closing the deal.

Read these books, listen to the audio programs, take the seminars and learn these skills. Otherwise, you won’t stand much of a chance in getting the money you need to start a business.

Copyright©2007 by Joe Love and JLM & Associates, Inc. All rights reserved worldwide.

Joe Love draws on his 25 years of experience helping both individuals and companies build their businesses, increase profits, and success coaching programs. He is the founder and CEO of JLM & Associates, a consulting and training organization, specializing in career coach training. Through his seminars and lectures, Joe Love addresses thousands of men and women each year, including the executives and staffs of many businesses around the world, on the subjects of leadership, achievement, goals, strategic business planning, and marketing. Joe is the author of three books, Starting Your Own Business, Finding Your Purpose In Life, and The Guerrilla Marketing Workbook.

When an awarding agency expects to be substantially involved in a project (beyond routine monitoring and technical assistance), the law requires use of a cooperative agreement instead. When the government is procuring goods or services for its own direct benefit, and not for a broader public purpose, the law requires use of a federal contract.

The federal government allocates tens of millions of dollars to various agencies every year to give grants to US residents. Big corporations use private foundations to give grants as tax write-offs and for community services. The Government agency to which you apply will send you an acceptance letter with your award amount. Shortly afterwards, you will receive your cash grant.

The amount of money that you receive all depends on the type of grant you are applying for and your actual needs. Grants issued can range from $5,000 to a million dollars or more. This is not a loan so the conventional methods of getting a loan do not apply when obtaining a free cash grant. Individuals who are unemployed and bankrupt receive grants. You can apply to as many grants as you want.

Written by Timothy Orleans. Find the latest information on Government Grants as well as Free Government Grants.

The goal for each of us playing is, starting from scratch, to make the smartest moves in the building of a strong and successful organization.

If we make bad moves we encounter serious obstacles which will set us back or even destroy what we are trying to build.

If we take the wrong shortcuts, we will have setbacks of varying magnitude. Each player is competing in today’s environment, with a high rate of change, a global marketplace, a potential workforce driven by whatever drives today’s generations.

What should we do first? What is the surest road to success? I would posit that in order to achieve the highest likelihood of constructing a business with longevity you must:

1. Have a strategic plan: At minimum,

o Clearly enunciate the vision, values, mission and goals
o Create an action plan
o Create an organizational structure
o Do a S.W.O.T. analysis
2. Have a good reason to start a business in the first place: Identify a need or a niche or a gap that exists in the market

o Determine that you can provide a product or service to meet that need at the right price
o Know who your potential customers are and what will drive them to buy what you are selling
3. Have clear values: Know what behaviors best represent those values, thus creating the company culture.

o The way the organization is structured, how it treats its employees and its vendors, should be a reflection of how the customers are treated.
o The values of the organization should extend in all directions and should be reflected in all relationships, resulting in happy employees and thus, happy customers.

4. Understand what competencies are required: Know which competencies are needed within the company to further its values and to enable employees to thrive in the organization.

o Hiring should be done based on these competencies as well as on technical skills.
o Leaders should be developed based on the competencies needed to fill their positions successfully.

5. Recognize that change is constant, and have a strong spirit of innovation and entrepreneurship through all levels of an organization.

6. Make sure that teamwork and collaboration is critical to success.

7. Be objective about our own skills and competencies and address shortcomings.

There are notable cases of individuals being successful by ignoring the above steps. Some who rush to market without research, without a plan and only a vision have done well. Some who hire for technical skills alone without looking at alignment of the employee’s goals and competencies with those needed in the organization can survive. And some who are unclear on their vision and values may be moderately successful.

Do Not Stop, Do Not Pass Go

But as a rule, those people who skip important steps encounter numerous obstacles which slow them down dramatically. So, the winner of this game would most likely be one following the above steps and not one trying shortcuts.

Starting a business and staying in business are difficult tasks, fraught with dangers. In a different time, when change didn’t occur at such a fast rate, a business leader could “rest” at various plateaus of growth, and maybe even run on “auto-pilot” for a while. Today, that is not possible.

No Get Out of Jail Free Card

Business leaders must engender entrepreneurship and innovation throughout their organization and must remain entrepreneurial even after becoming a second or third stage company. The traits utilized in bringing a company to life are continuously needed to keep it breathing, healthy and growing.

I used to believe that leading a mature company took different, separate competencies. But mature does not mean static. It means evolved, but only partially. Evolution is ongoing, and the need for continuous change requires an ongoing entrepreneurial spirit.

So, all of my recent themes are parts of a whole, pieces of a big picture. That picture is one of a business based on a living, fluid strategy, based in values, injected with entrepreneurship and innovation. Leadership must understand the external and internal constituencies of the business and must objectively look hard at all pieces of the big picture. This takes focus, diligence and passion.

For more leading edge tips for entrepreneurs, subscribe to David Sorin’s Mpowerment Matters ezine at http://www.managementmpowerment.com/. To learn more and comment on David’s blog, go to www.entrepreneursmentor.net.

David Sorin is a leading entrepreneur, author, speaker, attorney and CEO of Management Mpowerment Associate, at www.managementmpowerment.com, a firm that works closely with entrepreneurs to overcome business and personal obstacles to success.

So what’s the problem?

If life science and high-tech professionals know that a streamlined quality system is of the utmost importance, why do many companies lag in quality while failing to meet compliance standards?

The answer is that many life science and high-tech companies are holding on for dear life to quality systems that don’t work. Whether the quality system is paper-based, a hybrid or a Web-based system it still won’t function without specific goals, a flexible control plan and technology that provides both speed and support. To learn more about quality control goals and realistic “tempering” strategies that can be implemented via technology options read the following 5 steps to quality control success:

Step #1: Know Your Company’s Goals for a Better Quality System

The phrase “quality control” implies two types of goals that must be met and properly balanced within a regulated environment. The word “quality” for instance can imply the type of goals that will lead to product success and the genuine satisfaction of customers. The word “control” implies the tempering agents that won’t allow quality goals to “cross the line” of various realistic factors. These agents may include financial limitations, document management, compliance standards, the ability of employees to perform, dynamics between company departments, etc. Both quality goals and control tempering agents are important. Quality goals usually occur in the minds of managerial professionals and the tempering agents occur via technological solutions and via company employees.

Record your quality centered goals first and then let the tempering process occur in steps #2-5.

Step #2: Adapting Goals to Financial Factors for a Better Quality System

Once you have recorded your goals it’s time to temper them to reality, and what are more realistic than finances?

Obviously you want to have the highest amount of quality control that you can afford so look for a quality system that will (at the very least) provide Web-based document control (see step #3) and some sort of audit control. Also, look for a system that can grow over time (i.e. expand into additional quality processes with NonConformance, CAPA or Change Control solutions).

Step #3: Assessing Document Management for a Better Quality System

Since documentation control is required for almost every quality control or compliance procedure, it makes sense to make document management a priority for every quality process.

Whether a quality process is based on audits, CAPAs or change control procedures, look for a document control application that can streamline your quality processes and meet all regulatory compliance standards.

Step #4: Assessing Compliance Management for a Better Quality Control System

Meeting compliance regulations is on every life science company’s to-do list. Compliance regulations can greatly temper your original quality goals. For this reason, it is essential to invest in quality system technology that will change as regulations change, and provide the necessary updates for your quality system solution. Validation support is also a plus. Some companies offer validation scripts so that you can complete validation in-house.

Step #5: Assessing the Ability of Employees to Perform for a Better Quality System

The ability of your employees to understand quality and compliance standards and to act on those standards is of vital importance. How can you estimate your employees’ ability in order to best understand how your initial quality goals might be affected by their behavior? Consider investing in a software training solution that integrates with your document control solution. The solution should include the automated tracking of training related documents, should be Web-based, should include the automated assignment of tasks and tests as well as connections (if finances permit) to change control or audit results. The solution should also include automated test grading and escalation capabilities in case some employees aren’t quite rising to the occasion.

Conclusion for a Quality System Article

No matter what your quality goals are, it does matter how you choose to temper those goals with the right technology and the right people. Stop and consider the many ways in which your quality system could be better.

Marci Crane is a copywriter for MasterControl in Salt Lake City, Utah.

It’s better to be proactive instead of just reactive

Instead of giving up, it’s best to get busy. It’s easy to feel worn out; stress can make us slow down and want to do nothing We all need our time-outs, to rest and recuperate, but don’t overdo it or it can become a habit. Give yourself a set amount of time to feel all those feelings of anger, frustration or stress. Then, get up, dust yourself off, and take action. Looking for jobs, networking with other people, writing a resume is always good to do – just in case the worse scenario happens and your job is ended. It’s better to be prepared than to wait until it actually happens, because then panic can set in, and make things much worse. Sit down and write out a list of what kind of job you want, what kind of benefits you need, and what type of company you want to work for. Be as specific as possible. Just write it all out. You may or may not need to get another job, but in the meantime, writing helps to clarify what you want, and dispel some of that stress. When job hunting, don’t expect to get everything on that list, but use it as a guide in choosing between positions that you find interesting. Choose one that most suits what you’re looking for.

Don’t let company loyalty hold you back

If people are dropping like flies around you, then the writing is on the wall. It’s time to kick the job search into overdrive. The sooner you start to search, the better. The internet is a treasure trove of resources for you, when it comes to job searching. Submit your resume and look at jobs on different employment-related websites such as Monster.com, HotJobs.com, JobsOnline.net, or others. Don’t rely on one site. It doesn’t cost anything to submit a resume usually, or to get results sent to you in an email on a weekly basis. Even if you don’t want to leave your present job, it doesn’t hurt to look, and be aware of what else is out there. Doing this will make job hunting less intimidating and give you hope for a better day ahead.

If you’ve been miserable in your current position, maybe it’s time for a change

Are you sick and tired of listening to bickering customers on the phone all day long, or do your arms hurt from typing too much? Think of what type of job would be a better match for your personality and needs. If working forty hours in a windowless roomful of cubicles is unappealing to you, think of alternatives. Be practical, though. If finances or tight, don’t think that starting your own business will be an instant flood of cash on a consistent basis. Being a freelance artist, myself, it takes time and planning to build a business and see profit in the art world, unless you have high-powered connections. Would you like to open a coffee shop, gymnasium or start a camp? Whatever you long to do, plan and work towards doing it. Years ago, friends of mine were high-powered Manhattan executives, who chucked the city life and bought acreage in rural Pennsylvania. They started a camp for kids, on the top of a hill, with a big barn, a farmhouse and animals. This camp is now over thirty years old. They’re living their dream because they took a chance, and fled jobs that didn’t make them happy.

Whatever you do, the goal is to re-empower your mind, to feel better and get energized. Give yourself time, and patience to get through downsizing or outsourcing. You’re strong and you’ll get through it. The sun will come out tomorrow. It’s up to you to help yourself, by not giving up hope, being good to yourself, and being practical about the future. Trust your instincts, and give yourself time to decompress and relax, to keep from burning out. A better day will come, until then, just take it all one day at a time.

Carolyn McFann is a scientific and nature illustrator, who owns Two Purring Cats Design Studio, which can be seen at: http://www.cafepress.com/twopurringcats . Educated at the Rochester Institute of Technology in New York, Carolyn is a seasoned, well-traveled artist, writer and photographer. Clients include nature parks, museums, scientists, corporations and private owners. She has been the subject of tv interviews, articles for newspapers and other popular media venues.

Unfortunately, for many good technology companies, it may be too late to file for patent protection. The current U.S. rule generally provides applicants with a 1-year grace period during which a patent application must be filed after certain public or private disclosure of the invention. Such disclosure may arise, for example, from a mere “offer for sale” of the technology, even if the product has not yet been built or prototyped. In comparison, the foreign rule, which applies to many industrialized jurisdictions, such as Japan and various European countries, do not give applicants the benefit of any grace period after a public disclosure has occurred. Thus, it is legally compelling for applicants to consider filing for patent protection sooner than later. Although in some situations, there may be some special exception, which still allows for late filings; it is not advisable for applicants to count on those exceptions.

2. TOO NARROW LEGAL SCOPE OF CLAIMING PATENTABLE INVENTIONS.

Many issued patents are not commercially valuable because the scope of their submitted claims are particularly narrow, and can be relatively easily avoided by determined competitors. Thus when submitting new patent claim language, applicants should broadly define novel concepts that include potential design-around by other parties. Although this legal blocking strategy sounds easy enough to state as an objective, in fact, the serious exercise of analyzing future competitive and industry directions can be an extremely difficult task, particularly because the analysis often requires sophisticated market understanding, as well as technical and engineering vision.

3. INTERNALLY MISMANAGED PATENT INFRINGEMENT “WILLFULNESS” EXPOSURE.

Under U.S. patent law, one’s awareness or willful state-of-mind about the existence and infringement of a competitor’s issued patent may significantly affect subsequent legal liability. Thus if a party is proven to be a willful infringer of a known patent, then for punitive policy reasons, economic damages may be awarded to the patent owner up to three times normal recovery amount. This treble-damage exposure is so substantial, that company management should be careful to avoid creating evidence of internal communications such as emails that may be construed later to indicate such willfulness state-of-mind. Additionally in many cases, it may be appropriate for companies as a matter of policy to discourage looking at issued patents owned by other entities. And when a suspect patent is already known, management must take careful steps to refer the matter to competent patent counsel for appropriate analysis and opinion.

4. RELYING SOLELY ON COPYRIGHTS FOR SOFTWARE PROTECTION.

Copyright protection in the U.S. and many other countries arises instantly and at virtually no cost to protect software technologies, such as computer programs, electronic databases, and graphical display screens and related media. In fact, copyright protection is often quite a suitable means to secure much digital media such as video and audio creative works, often even without compliance with copyright registration and notice requirements. Copyright protection, however, is legally vulnerable to reverse engineering efforts by competitors, during which no copyright infringement may arise when the reverse engineering results does not result in literal copying of the original code, but merely an understanding of the underlying ideas and functions. In this vulnerable scenario, perhaps patent protection may be more appropriate to secure any novel algorithm, methods, and computing apparatus.

5. INADVERTENTLY TAINTING I.P.R. WITH 3RD-PARTY CO-OWNERSHIP RIGHTS.

During the course typically of joint-development engineering projects, ideas may originate from many sources, such as advisors, consultant, employees, and even customers. This collaborative scenario sets the stage for creating intellectual property rights that may be co-owned by multiple parties. And unless the rights of such joint owners are specified up-front, for example by contract terms, then there is a problematic possibility that certain parties later may assert not just their partial ownership interest, but actually endeavor to offer licensing rights to other 3rd parties or even competitors.

6. IGNORING THE IMPACT OF NEW “FESTO” U.S. SUPREME COURT RULING RE PATENT AMENDMENTS.

On May 28, 2002, the U.S. Supreme Court (Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., Ltd) substantially changed the legal effect of amending patent claims, particularly upon the effective scope of amended claims. This judicial change cannot be ignored without possibly impairing commercial value of many issued U.S. patents, especially where applicants introduce explicit argument that distinguish various prior-art cited by the Patent Examiner. Without getting into the subtle legal and policy complexities associated with the so-called “Doctrine of Equivalents,” the Festo decision and related subsequent federal cases clearly narrow many patent claims scope whenever applicants propose routine amendments to distinguish the claimed invention against cited prior-art references.

7. UNDERESTIMATING THE IMPORTANCE OF TRADE SECRETS AND CONFIDENTIALITY.

Since patent protection may not arise for many years until after filing patent applications, and copyright protection may not be applicable to protect functional aspects of various technologies, trade secret protection may serve realistically as a solid backstop against competitive piracy or other misappropriation of company know-how. Thus the importance of diligent use of Non-Disclosure Agreements (NDA) and in-house policies and systems to secure confidential and proprietary information rises to a more significant level of management priority. Additionally early disclosures, for example through customer marketing presentations, may irreparably hurt company rights to file domestic or international patent applications.

8. OVERLOOKING LEGITIMATE OPPORTUNITY TO SET-UP OFFSHORE LICENSING TAX SHELTERS.

Often neglected by early-stage startup companies and entrepreneurs are offshore strategies for mitigating federal tax exposure. Such international tax strategies are especially relevant when foreign licensees of intellectual property rights are contemplated possibly in the company business plan. In many cases in fact, it is particularly beneficial to deploy one or more corporate entities offshore much sooner, rather than after licensees are identified, in order to minimize certain taxable valuation exposure associated with transferring such licensed rights.

9. RESPONDING SLOWLY TO U.S.P.T.O. OFFICE ACTIONS.

Because the U.S. patent rules now provide 20 years of enforcement patent protection, after the U.S. filing date, it is important to expedite the claim amendment and application prosecution process; otherwise applicant’s enforcement period is effectively eroded by unnecessary delays in the process. Accordingly, applicants should endeavor to respond in timely fashion, expediting all office action responses and facilitating, communications with patent counsel whenever possible. Additionally, the new patent rules actually apply a time penalty to deduct enforcement period against issued U.S. patents in certain situations where applicants contribute to delays during patent prosecution.

10. OVER/UNDER-SPENDING ON LEGAL FEES TO PROSECUTE PATENT APPLICATIONS.

In the realistic context of the current economic recession especially in Silicon Valley, startup companies and entrepreneurs who are strapped for cash may negotiate for substantial fee discounts from patent counsel to prepare and file patent applications. However, patent applicants should be careful to ensure that most qualified legal counsel in terms of technical and business experience are selected and engaged to work on critical company inventions, perhaps with bottom-line pricing being just one of a number of significant factors to consider.

Dennis has over twenty-years experience in Silicon Valley and High-Tech Industry, as a patent prosecutor and intellectual property litigator, a venture capitalist, and an engineering manager. He specializes in developing offensive and defensive patent strategies for start-up electronics, software and biotech companies and their investors.

Dennis serves as strategic advisor to leading venture capital firms. He is also on the Editorial Board of the Nanotechnology Law & Business Journal, the Board of Directors of the Association of Patent Law Firms, and the Science and Technology Advisory Council. Previously Dennis served on a consultancy with the United Nations Development Program on Asian economic development.

Dennis is also an inventor of several U.S. and international patents in the areas of digital television, sensor networks, and bioinformatics. He has an Electrical Engineering degree from Northwestern University, a law degree from Suffolk University Law School , and is a Registered U.S. Patent Attorney.

But legal and business groups are finding themselves at odds over the legislation, with some saying it would reduce patent litigation costs and improve patent quality while others say it would do just the opposite. Everyone, it seems, can find parts of the measure to love and others to hate.

In April, identical bills were filed in the Senate and House, each titled the Patent Reform Act of 2007. In the Senate, Leahy and Hatch introduced S. 1145, while in the House Representatives Howard Berman (D-California) and Lamar Smith (R-Texas) introduced H.R. 1908.

On May 16th, a House subcommittee approved the bill for further review by the full Judiciary Committee, which held hearings on it in June. The committee released a revised version of the bill June 21st.

In an effort to help make sense of this legislation, we offer this guide to its key provisions, together with summaries of the arguments being raised for and against.

CONVERT U.S. TO FIRST-TO-FILE

What it would do: In what would be a fundamental shift in U.S. patent law, the bill would bring the United States into conformity with the rest of the world by converting it from a first-to-invent to a first-inventor-to-file system.

Arguments for: Proponents maintain this would simplify the patent process, reduce legal costs, improve fairness, and enhance the opportunity to make progress toward a more harmonized international patent system. A first-to-file system, they say, provides a fixed and easy-to-determine date of priority of invention. This, in turn, would result in greater legal certainty within innovative industries.

Proponents also believe that this change would decrease the complexity, length, and expense associated with current USPTO interference proceedings. Rather than tie up inventors in lengthy proceedings seeking to prove dates of inventive activity that may have occurred many years earlier, inventors could continue to focus on inventing.

Finally, because this change would bring the U.S. into harmony with the patent laws of other countries, it would enable U.S. companies to organize and manage their portfolios in a consistent manner.

Proponents include: Biotechnology industry.

Arguments against: Opponents argue that adoption of a first-to-file system could promote a rush to the USPTO with premature and hastily prepared disclosure information, resulting in a decline in quality. Also, because many independent inventors and small entities lack sufficient resources and expertise, they would be unlikely to prevail in a “race to the patent office” against large, well-endowed entities.

Opponents include: The USPTO opposes immediate conversion to a first-to-file system, in part because this remains a bargaining point in its ongoing harmonization discussions with foreign patent offices. Inventors also oppose this.

APPORTIONMENT OF DAMAGES

What it would do: The bill would significantly change the apportionment of damages in patent cases. Under current law, a patentee is entitled to damages adequate to compensate for infringement but in no event less than a reasonable royalty. Section 5(a) of the bill would require a court to ensure that a reasonable royalty is applied only to the economic value attributed to the patented invention, as distinguished from the economic value attributable to other features added by the infringer.

The bill also provides that in order for the entire-market rule to apply, the patentee must establish that the patent’s specific improvement is the predominant basis for market demand.

Arguments for: Proponents say this measure is necessary to limit excessive royalty awards and bring them back in line with historical patent law and economic reality. By requiring the court to determine as a preliminary matter the “economic value properly attributable to the patent’s specific contribution over the prior art,” the bill would ensure that only the infringer’s gain attributable to the claimed invention’s contribution over the prior art will be subject to a reasonable royalty. The portion of that gain due to the patent holder in the form of a reasonable royalty can then be determined by reference to other relevant factors.

Complex products, the proponents contend, often rely on a number of features or processes, many of which may be unpatented. Even where the patented component is insignificant as compared to unpatented features, patentees base their damage calculations on the value of an entire end product. This standard defies common sense, distorts incentives, and encourages frivolous litigation.

Further, courts in recent years have applied the entire-market-value rule in entirely dissimilar situations, leaving the likely measure of damages applicable in any given case open to anyone’s guess.

Proponents include: Large technology companies and the financial services industry.

Arguments against: Opponents argue that Congress should not attempt to codify or prioritize the factors that a court may apply when determining reasonable royalty rates. The so-called Georgia-Pacific factors provide courts with adequate guidance to determine reasonable royalty rates. The amount of a reasonable royalty should turn on the facts of each particular case.

Although intended to guard against allegedly inflated damage awards, this mandatory apportionment test would represent a dramatic departure from the market-based principles that currently govern damages calculations, opponents say. Even worse, it would result in unpredictable and artificially low damages awards for the majority of patents, no matter how inherently valuable they might be.

Opponents further argue that this change would undermine existing licenses and encourage an increase in litigation. Existing and potential licensees would see little downside to “rolling the dice” in court before taking a license. Once in court, this measure would lengthen the damages phase of trials, further adding to the staggering cost of patent litigation and delays in the judicial system.

Opponents include: The USPTO, Federal Circuit Court of Appeals Chief Judge Paul Michel, the biotechnology industry, smaller technology companies, patent-holding companies, medical device manufacturers, university technology managers, the NanoBusiness Alliance and the Professional Inventors Alliance.

WILLFUL INFRINGEMENT

What it would do: Section 5(a) of the bill would limit a court’s authority to award enhanced damages for willful infringement. It would statutorily limit increased damages to instances of willful infringement, require a showing that the infringer intentionally copied the patented invention, require notice of infringement to be sufficiently specific so as to reduce the use of form letters, establish a good faith belief defense, require that determinations of willfulness be made after a finding of infringement, and require that determinations of willfulness be made by the judge, not the jury.

Arguments for: Proponents say that willfulness claims are raised too frequently in patent litigation – almost as a matter of course, given their relative ease of proof and potential for windfall damages. For defendants, this raises the cost of litigation and their potential exposure.

A codified standard with fair and meaningful notice provisions would restore balance to the system, proponents say, reserving the treble penalty to those who were truly intentional in their willfulness and ending unfair windfalls for mere knowledge of a patent.

Further, tightening the requirements for finding willful infringement would encourage innovative review of existing patents, something the current standard discourages for fear of helping to establish willfulness.

Proponents include: Large technology companies, the financial services industry, and the biotechnology industry.

Arguments against: Opponents argue that willfulness is already difficult to establish under existing law. The additional requirements, limitations, and conditions set forth in the bill would significantly reduce the ability of a patentee to obtain treble damages when willful conduct actually occurs. The possibility of treble damages under current law is an important deterrent to patent infringement that should be retained as is.

Opponents include: The USPTO, the Professional Inventors Alliance.

INTERLOCUTORY APPEALS

What it would do: Section 10(b) of the bill would permit an interlocutory appeal to the Federal Circuit Court of Appeals after a Markman hearing on claim construction, rather than waiting for a final judgment from the district court.

Arguments for: Proponents say these appeals would reduce the length and cost of litigation. Claim construction, they argue, is a fundamental predicate that goes to the heart of any patent infringement case. Until a claim is construed, it is impossible to establish whether infringement occurred and whether the patent is invalid. This process also serves to narrow discovery and motion practice and related expenses. Proponents assert that an interlocutory appeal would help to mitigate the judicial inefficiency that occurs when a full trial is conducted based on an incorrect interpretation of the patent, only to be reversed on appeal and sent back for a second trial. More than a third of all Markman rulings are overturned on appeal, meaning that many litigants end up paying the attorney fees and expenses for two trials.

Proponents include: Large technology companies and the financial services industry.

Arguments against: Opponents say interlocutory appeals from Markman hearings would increase litigation and court congestion and offer “another bite at the apple” because the reversal rate for claim construction is fairly high. The net result, they say, will be to significantly delay final judgments from the lower court, significantly delay potential settlements, and significantly increase litigations costs.

Opponents argue that the Federal Circuit would not be able to handle expeditiously the large numbers of Markman appeals, meaning that resolution of the underlying district court cases would be delayed for years.

If this provision is enacted, opponents say, it would result in an interlocutory appeal in virtually every patent infringement case as soon as a Markman order is issued. One study estimates this would double the number of appeals each year.

Opponents include: The USPTO, Federal Circuit Chief Judge Michel, the biotechnology industry, smaller technology companies, and smaller patent-holding companies.

POST-GRANT REVIEW

What it would do: The bill would expand the ability of third parties to challenge a patent after its issuance. In particular, it would allow any person to oppose a patent within 12 months after it is granted. More controversially, it would allow a challenge at any time if the petitioner “establishes a substantial reason to believe that the continued existence of the challenged claim in the petition causes or is likely to cause the petitioner significant economic harm.”

A newly designated Patent Trial and Appeal Board would be responsible for conducting the post-grant reviews. The presumption of validity that applies to patents during litigation would not apply to these post-grant review proceedings. Instead, a “preponderance of the evidence” standard would apply.

Arguments for: Proponents say these post-grant review procedures would be an improvement over existing reexamination procedures because they would allow consideration of evidence gleaned through depositions and interrogatories as well as from patents and other documents. Also, proceedings would be overseen by an administrative law judge rather than a patent examiner. These changes would allow for more meaningful review and that, in turn, would lead to better patent quality overall.

The so-called second window – the ability to challenge at any time – is necessary, proponents say, to allow for a meaningful and broadly available reevaluation of suspect patent claims before a firm is forced into prolonged and expensive litigation.

Proponents include: Large technology companies and the financial services industry.

Arguments against: While reexamination is an important component of the patent system, it must be structured in a manner that preserves the value and enforceability of the majority of patents, opponents say. This change would create an essentially limitless opportunity to challenge a patent at any time during its life. This would be a dramatic departure from the norm and cast a cloud of uncertainty over issued patents. If a patent can easily be challenged at any time under a low standard of proof, patents will have much less value and investment predicated upon them will inevitably be diminished. This, in turn, will likely result in less innovation.

Additionally, the resulting surge in complex, post-grant review proceedings would further strain an already overburdened and under-funded USPTO, thereby jeopardizing the agency’s ability to improve pre-grant patent quality.

Opponents include: The USPTO, the biotechnology industry, smaller technology companies, patent-holding companies, medical device manufacturers, university technology managers, the NanoBusiness Alliance and the Professional Inventors Alliance.
PRIOR USER DEFENSE

What it would do: Section 5(b) of the bill expands the prior-use defense, which presently applies only to business-methods patents, to cover all patents.

Arguments for: Proponents argue that this expansion is reasonable in a competitive economy and strikes a balance between trade secret and patent protection. They also say it goes hand-in-hand with U.S. adoption of a first-to-file rule. Prior-user rights benefit smaller businesses, which often lack the resources or know-how to pursue patent protection, proponents say. This measure would allow them to commercialize their inventions when they used the subject matter of the invention prior to the patent’s filing date, even when they did not pursue patent rights.

Some foreign countries presently allow prior-user rights, including Germany and Japan. This measure would help level the playing field for U.S. companies by putting them in the same competitive position as their overseas counterparts.

Proponents include: The financial services industry and the biotechnology industry.

Arguments against: Opponents contend that prior-user rights undermine the purpose of a patent system by creating a strong incentive to protect innovations as trade secrets. Under a prior-use defense regime, if inventors are able to protect their innovations as trade secrets, they are able to use them indefinitely, even if someone else obtains a patent on the invention.

Opponents also argue that this change would benefit larger corporations at the expense of smaller ones. They also contend that prior-user rights would reduce the value of patents and therefore make innovation less desirable.

Opponents include: The USPTO, the Professional Inventors Alliance.

VENUE

What it would do: Section 10(a) of the bill limits the places where corporations may be sued in patent cases by amending 28 U.S.C. § 1400(b) to provide that a corporation “resides” only where it has its principal place of business or in the state in which the corporation is incorporated. Current law presumes a corporation to reside wherever it is subject to personal jurisdiction. This change would not apply to declaratory judgment actions brought by alleged infringers.

Arguments for: Proponents argue that this change would discourage forum shopping. As the law now stands, any company whose products are sold nationwide is subject to patent litigation in any jurisdiction in the country. As a result, certain jurisdictions have become magnets for patent cases because of the disproportionately high number of cases they decide in favor of patentees.

This forum shopping imposes a costly burden on businesses which must collect evidence and witnesses and travel to remote jurisdictions to try complex patent cases over a period of weeks or months.

Proponents include: Large technology companies, the financial services industry, and the biotechnology industry.

Arguments against: Opponents argue that this change would be a substantial departure from established practice and may not result in the most appropriate and convenient venue for litigation. Certain district courts attract patent cases not because of favoritism, they say, but because of their expertise and timeliness. They also argue that the impact of forum shopping is minimized by the existence of a single appellate court for patent cases, the Federal Circuit.

Opponents include: Smaller patent-holding companies, smaller technology companies.

USPTO REGULATORY AUTHORITY

What it would do: The bill would authorize the USPTO to promulgate substantive – as opposed to procedural – rules and regulations for the first time in its history.

Arguments for: Proponents argue that giving the USPTO substantive rulemaking authority would be beneficial to the patent system and would help ensure an efficient and quality-based patent examination process.

Proponents include: The USPTO.

Arguments against: Opponents note that the U.S. Constitution expressly gives Congress the power to protect intellectual property and that delegating that authority to an administrative agency would be an ill-considered abdication of that Constitutional authority. Further, this grant of authority would create instability in the patent system, because the USPTO could make multiple changes to the law during the life of a patent. The job of defining substantive patent law is better left to Congress and the courts.

Opponents include: The biotechnology industry, smaller technology companies, patent-holding companies, university technology managers, medical device manufacturers, and the NanoBusiness Alliance.

INVENTOR’S OATH

What it would do: The bill would change the current practice of requiring the inventor to sign an application. It would allow the assignee of an invention to file a patent application in its own name. It would also allow substitutes for the inventor’s oath where the inventor is unable or unwilling to sign.

Arguments for: Proponents say this change would reduce unnecessary formalities in the patent application and simplify and streamline the process. They also say this change would go hand-in-hand with a U.S. shift to a first-to-file system.

Proponents include: The USPTO.

Arguments against: Opponents say that patent applications filed by assignees may lack the actual inventor’s personal guarantee that the application was properly prepared. In addition, assignee filing might derogate the right of natural persons to their inventions.

Opponents include: The Professional Inventors Alliance.

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