Patents becoming assets for business development

The way the business world is queuing up before the patent offices, it is quite evident that patents are being accorded the highest importance as an asset for business development by businesses. Of late, it has been reported in the media that the Bank of America has applied for or received 43 patents – the maximum number of patents for blockchain. Virtual currencies like Bitcoin primarily work using the ledger technology used for verifying and recording transactions known as blockchain.

Not very close to the Bank of America, but with a sizeable number, are the International Business Machines Corp (IBM) and Mastercard Inc, with 27 patents each, for choosing to use blockchain and artificial intelligence for giving the push for future growth. These are the big companies which typically are the leaders in their chosen field of business and quite often successfully anticipate the future path of growth along with the method to be followed to achieve the decided goal.

Amazon has recently patented a robot, which can tailor clothes with glow-in-the-dark guidance. This is a system which uses fluorescent inks as a guide for cutting fabric. This ink can be used on fabric, rubber, leather, paper, plastic, etc. The ink remains invisible under normal lighting, however, it can be seen under ultraviolet light and can be detected with sensors to do as instructed. The applications can be enormous for customised products. These products can be made even in the delivery truck, which may be driverless.

From technology companies to luxury brands making fashion statements, and from biotechnology innovations to financial engineering, intellectual property is emerging as the foremost requirement for the success of a business enterprise. Businesses are protecting their turf even in some of the jurisdictions which were erstwhile considered to be extremely weak intellectual property regimes like China. Recently, on January 11, China’s Shenzhen Intermediate Court decided in favour of Huawei, the Chinese smartphone maker, against the South Korean giant Samsung. The court ordered Samsung to stop manufacturing and sale of the infringing products and observed that Samsung had maliciously delayed negotiations between the two companies since 2011. Though this is a Chinese court’s decision in favour of a Chinese company against a foreign company, however, it should not be construed as a nationalist bias because patent holders are being given considerable importance and recognition.

In the cloud technology, IBM got more than 1,900 cloud technology patents in 2017. According to IBM, its patents include 1,400 artificial intelligence patents, 1,200 cyber security patents and several others in related areas. IBM has received more patents per year for 25 years than any other American company.

Grand old tales of patent litigation regarding the electric bulb, Ford’s car, telephone, even a wooden pavement have become part of folklore for law students and intellectual property fraternity. Several of these cases were decided by the US Supreme Court in the 19th century taking the intellectual property protection to glorious heights, and interestingly, with the opening of floodgates of business method patents in 1998 in the State Street Bank case, the judiciary in the United States gave a new twist to patent protection and business development.

In the last decade or so, the explosive growth of business method patents has been criticised on several occasions, however, the courts have not yet ruled against the business method patents as evidenced from the Bilski versus Kappos case in 2010, and later in Alice Corp versus CLS Bank case in 2014. A similar trend has been followed which has compelled several writers to comment on the efficacy of the grant of too many patents, which at times leads to patent trolls resulting in, debatably, an impediment in the development of business and technology.

The way technology related to robotics, artificial intelligence, cloud technology, biotechnology, smart phone usage, telecommunications, pharmaceuticals and several areas concerned with making the lives of human beings better is developing and evolving, patents will no doubt remain as the most important asset for businesses.