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   Outsourcing IP work overseas/secrecy order risks?
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patent1970
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Outsourcing IP work overseas/secrecy order risks?
« on: Oct 22nd, 2004, 2:50pm »
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Hi all,
 
I've been lurking and finally has something interesting to pose, I think.
 
A client of mine (US research company)  has approached me about outsourcing most of their patent work (a few dozen cases a quarter and the current prosecution portfolio of 60 or so cases)  to an Indian outfit.  
 
Since we don't do prosecution for this client, I have no interest either way.  They retain us to review licensing matters and to advise now and then on how their prosecutors are doing.  You can say I'm sort of a pseudo-virtual inhouse counsel on their IP issues.  I am also a friend of the CFO so he just popped me this question regarding sending work to India.
 
I am inclined to say go ahead, as I did before for another client, but for one small issue that is specific to this client.  It's been nagging me.
 
One thing that concerns me is that their work deals with rather exotic technologies. I of course can't go into details--it is in the area of high speed computing and complex sensor arrays, things of that sort (how is that for vague?)
 
Nevertheless, I know they had two or three secrecy orders imposed on their patent applications in the past few years.  Client not happy about that, but that's not for me to decide.  For those who are not aware, all patent applications are reviewed by the USPTO (except those already having gov't interest, in which case the gov't agencies do the reviewing themselves) for sensitive national security matters, like Defense or Atomic Energy, those kinds of things.  If the application contains matters sensitive to national security, then a secrecy order is imposed.  35 USC 181, I believe.
 
I already told them that the secrecy order cases have to stay in the US (in addition to the usual keeping mum).  But I'm worried about what's coming.  
 
So here are my questions.  
 
1)  Should I okay them for using the Indian outsourcing firm?  The benefit is extremely attractive:  They can save up to 50-70% of the cost of a patent application.  If a patent application is outsourced to the Indian firm and then filed in the USPTO, and a secrecy order is issued, can anyone see any potential liability?  
 
2)  I am not up to date on the latest Patriot Act and the whole slew of legislations dealing with terrorism.  What if one of their high speed computing techniques is found to have applicability in building some nutty weapons.  Does the fact that the case is prepared by an Indian engineer/trainee in Mumbai or Bangalore before filing in the USPTO and before the issuance of the secrecy order create any liability for the company?  More specifically, any liability for the officers of the company  (like my friend)?
 
3)  Finally, anyone has any experience with using outsourced Indian patent prosecution firms?  I have had excellent experience with Indian technologists and I have to believe that they are quite good.  I have seen a sample draft application--and I'm pleased with its quality.  But how is real life experience?  
 
No politics or impassioned arguments regarding outsourcing please.  As you can imagine, I heard an earful from the current prosecution firm, since they can't compete in price.   I tend to ignore those arguments.
 
I want to (have to, in fact) do what's best for the client based on the law, including saving them $ and higher quality, and I would appreciate hearing from other practitioners here.
 
Any Indian/overseas practitioner on here wants to chime in, I'd be very grateful.
 
Thanks in advance.
 
Patent1970
 
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Isaac
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Re: Outsourcing IP work overseas/secrecy order ris
« Reply #1 on: Oct 22nd, 2004, 4:05pm »
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Unless there is some export regulation involved on the technology, I don't think the question of who drafts the patent application is a legal issue.  Certainly the PTO regulations are about filing and the resulting disclosure rather than about a presumably confidential disclosure to a foreigner inside or outside the US who does the drafting work.  
 
But I personally would not be comfortable with exporting of drafting work that the US government is likely to decide should not be exported.    
 
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Re: Outsourcing IP work overseas/secrecy order ris
« Reply #2 on: Oct 22nd, 2004, 6:33pm »
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on Oct 22nd, 2004, 2:50pm, patent1970 wrote:
1)  Should I okay them for using the Indian outsourcing firm?  The benefit is extremely attractive:  They can save up to 50-70% of the cost of a patent application.  If a patent application is outsourced to the Indian firm and then filed in the USPTO, and a secrecy order is issued, can anyone see any potential liability?  

Once you file your patent application, you are automatically evaluated for a foreign filing license -- permission to file outside the US.  I believe you can submit a fairly rudimentary disclosure as an application for a foreign filing license.  If the license is granted, you probably have no problems sending the work overseas.  
 
Now, my experience is pretty much limited to patent practice.  If there are other laws to look out for, I don't know much about them.  But I think a foreign filing license is pretty close to a blank check to expose your technology overseas.
 
on Oct 22nd, 2004, 2:50pm, patent1970 wrote:
2)  I am not up to date on the latest Patriot Act and the whole slew of legislations dealing with terrorism.  What if one of their high speed computing techniques is found to have applicability in building some nutty weapons.  Does the fact that the case is prepared by an Indian engineer/trainee in Mumbai or Bangalore before filing in the USPTO and before the issuance of the secrecy order create any liability for the company?  More specifically, any liability for the officers of the company  (like my friend)?

Don't know.  Foreign filing licenses are decided upon pretty quickly from what I understand (a couple weeks, maybe).
 
on Oct 22nd, 2004, 2:50pm, patent1970 wrote:
3)  Finally, anyone has any experience with using outsourced Indian patent prosecution firms?  I have had excellent experience with Indian technologists and I have to believe that they are quite good.  I have seen a sample draft application--and I'm pleased with its quality.  But how is real life experience?

Who's going sign the papers?  It has to either be the applicant themselves or a someone registered to practice before the USPTO.  When you find such a person, they'll want to consider their malpractice coverage if the budget doesn't allow for meaningful review and editing of the drafts from overseas.  
 
If and when the patent is litigated, who's going to be called as a witness?  Having testified myself about some of my work, I have no intention of being examined and cross-examined about something someone else wrote.  Beyond that, consider that Indian English and American English don't map one-to-one.  I don't mean any offense to any non-native English speakers, but some apparently minor linguistic discrepancies can open the door on challenges based on vagueness or ambiguity or lack of enablement.  Patents are no place to use the wrong words; it's just not tolerated in the law.
 
Get a writing sample.  Some of the things I've seen written in India suggest that I'd spend nearly as much time translating it into American Patent English as I would spend just writing it myself.  However, a writing sample might convince you otherwise.  My fear there is that the company doing the writing in India may have high turnover and the person who wrote the writing sample might not actually do the writing for me long term.
 
I've thought much about somehow leveraging the lower cost of living overseas to provide bulk, inexpensive, high-quality legal services and, so far, I don't see how I can maintain the high-quality if I don't have careful control over who's doing the drafting.  And, I'm not sure I can manage that as tightly as I'd like from here in the US.
 
Now, some clients are huge and only care about numbers.  MSFT has indicated that they intend to file 2,000 applications this year and 3,000 next year.  They also say they've never asserted a patent on software.  (Many think MSFT is about to change strategy, by the way.)  If your hope is to build a huge portfolio and never rely heavily on any single patent, using the cheapest writers possible makes sense.  
 
Remember, cheapest isn't always the most economical -- otherwise, we'd all be driving Yugos.
 
One last thing.  I had heard a while back that the PTO was going to amend the rules of practice to eliminate ghostwriting.  I honestly don't know (i) whether they made such changes or (ii) how it would be implemented since many attorneys have youngers associates draft papers for the attorneys' review and signature.  
 
I hope that's helpful.
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Re: Outsourcing IP work overseas/secrecy order ris
« Reply #3 on: Oct 26th, 2004, 7:38am »
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According to below given link, the U.S. Patent agents/attorneys need to be residing in U.S. and/or be U.S. Citizens.  Also, foreign registered agents/attorneys can only file the inventions based from their country.
 
So, I do not understand how it will be outsourced unless non-registerered persons perform the work. Also, U.S. patent law is supposed to be fairly different from other countries.
 
In addition I would check up if  there are any issues of attorney-client privilege if attorney/agent (not registered in U.S.) is drafting and prosecuting the application.
 
http://www.bitlaw.com/source/37cfr/10_6.html
 
Note: This is not legal advice. Just my personal opinion.
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Re: Outsourcing IP work overseas/secrecy order ris
« Reply #4 on: Oct 28th, 2004, 3:23pm »
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Can some one please let me know what a decent wage in Canadian dollars is for India
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