Technology companies intending to market innovative products face the following situation: 3 million patent applications are being filed, yearly. How to practically deal with the legal risk of potentially infringing millions of patents as a business executive. How to assess FTO?

"Let's ask our external patent attorney, if we have FTO for our innovative product", one might think. Sorry, that does not work! An attorney is qualified to give specific legal advice but not business management advice. It is quite like asking an insurance broker, if you need a particular insurance against whatsoever. Don't waste your time on this, I'll give you a likely answer for free: "Have that XXL FTO (or insurance). It is important to reduce your risk. Imagine, what will happen, if...". Alternatively, the answer could be: "It depends..."

How many insurances do you have? I have a few but I deliberately choose which ones I really need. 

“OK, got it but: 🤷 How to FTO, then?”

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To be clear, I am all in for ALWAYS having an FTO check, when entering new markets or launching new products. The approach, strategy and scope of an FTO is however certainly a highly business specific IP management task. FTO design should take into account factors like resources, manpower, agility, etc.

Generally, FTO processes should be designed to not inhibit agility in innovative product generation. On the other hand, legal business risks have to be managed, as well. In relation to "innovation", "FTO" would often be in a sensible tradeoff position: 

innovation agility vs. legal risk management.

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...smartly tackle "FTO" in 5 steps, a possible approach in a nutshell:

1️⃣ Check your business case for your product (chances)

2️⃣ Find out which legal/economic risks you are willing to take with your product (worst case scenario, etc.)

3️⃣ Decide on your FTO resources (manpower, money, time) to spend. Base your decision on step 1 and step 2.

4️⃣ Do a reasonable (step 3-resources) IPR/patent search and evaluation. Stay agile!

5️⃣ If necessary, ask a (patent) attorney for legal advise on potentially relevant patents identified in step 4. 

One is well-advised to design FTO processes and perform FTO tasks in alignment with the business and in conformity to the IP strategy. An experienced and business-focussed IP manager understands the multifaceted challenges of an FTO and helps you to succeed.

👉 Get in touch with me for IP strategy and IP management consultation and coaching.