Category: Innovation

Earliest of TechNexus collaborators, OK Labs has been acquired by General Dynamics

Steve Subar launched and grew Open Kernel Labs from within Chicago’s TechNexus incubator over the past five years, becoming only the second of what has now been more than 170 young companies to grow in the ecosystem. While growing at TechNexus, Steve led OK Labs to more than 50 employees, through millions of dollars in capital raises, and now to a successful exit to General Dynamics (NYSE: GD), a $32 billion aerospace and defense company.

At TechNexus we take pride in the success of the companies that collaborate in our incubator, but also companies that represent what the Chicago tech scene is all about – hard-nosed innovation and building scalable businesses.

OK Labs recognized the immense potential of mobile virtualization. Before the acquisition, OK Labs had deployed its software on more than 1.6 billion devices. Only a handful of other companies can say that, and OK Labs is the youngest to have reached that milestone.

This sort of innovation and alignment between new ventures and industry leading corporations is exactly the focus of TechNexus — and where much of our time has been directed. We are all proud of OK Labs evolution. Congratulations to Steve and the entire team at OK Labs! We look forward to supporting your transition as well as your future contributions to General Dynamics.

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Trademarks matter, and this is exactly why they exist

Today Timelines Inc., a growing young company based inside of Chicago’s TechNexus, filed a trademark infringement suit against Facebook. Timelines has operated timelines.com, a site that allows people to post pictures and notes to tell the story of their lives and the story of events around them. They have a registered trademark, and even facebook.com/timelines had been setup and enjoyed by users and fans of the timelines.com site. The folks at Timelines Inc invested five years and $3m building their product and brand.

Facebook has decided to call their new, enhanced profile feature (rolling out now, and over the coming weeks to all users) a “Timeline”. Not only does this concept and trademark name pretty directly conflict with the Timelines.com site’s own intellectual property, Facebook was so egregious about taking over the name that they even redirected facebook.com/timelines to their new product (just seizing control away from tiny Timelines Inc without warning or notice). At the top of timelines.com, they still have a link to their old Facebook.com/timelines fan page, which Facebook hijacked and now uses to promote their new Timelines feature.

This is a case of Goliath and David, with the world’s largest social network not just rolling out a new feature that’s remarkably similar, but intentionally doing so in a way that threatens the very existence of another company. Sometimes intellectual property lawsuits in the tech industry can seem a little capricious… but this case is very clearly about the confusion caused by a giant company throwing their weight around with no regard for the small entrepreneur. If not for this lawsuit, Facebook would have steamrolled over this little company, and probably succeed at erasing it’s very existence. Ideas matter, intellectual property is an asset, and trademarks have to mean something, even to the big guys.

TechCrunch and many other national outlets are now covering the story.

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Securing Trade Secrets in a New First-to-File Patent Process

The tech industry has a paramount interest in patents and protecting intellectual property, and it’s worth a review of the recent, rather historical, changes to patent law.

Pres. Obama signed The America Invents Act, AIA, on Sept. 16, 2011, at Thomas Jefferson High School for Science and Technology in Alexandria, Va. Three major provisions of AIA significantly change the United States patent process.

AIA allows direct funding of the U.S. Patent and Trademark Office. Congress will assign a budget for the office, but the patent fees will be placed in escrow and that money can be released when it exceeds the allocation.

This new law sets up a review process for patent applications. Third parties may question the validity of a patent for nine months after issuance.

The most important change, however, is “first-to-file,” which makes the U.S system similar to other nations and eliminates “first-to-invent.”

Different parties of interest have presented arguments pro and con about this legislation. Many commenters have questioned the effects on shop, garage and backyard innovators. One widely claimed drawback facing independent, individual inventors is their lack of funds to complete the “reduction to practice” requirements of patent law. A functional operation of the patent, beyond the conceptual state, must be demonstrated to show either actual or constructive practice, which are legal “terms of art.” This often requires capital funding, and disclosure may be necessary to convince lenders or investors.

Under first-to-invent, an inventor could prove with good documentation that a practical invention had existed before a patent thief filed. With first-to-file, the process can be hi-jacked any time. A co-worker, relative, employee, investor, etc., may find opportunities to seize a concept and patent it first, especially if that person can access quicker funding or superior developmental facilities in order to complete the reduction to practice. This burdens inventors with the need to protect ideas from all potential patent thieves.

Internal and external security for patentable concepts now require stricter controls by inventors. The following six suggestions should matter to a tech entrepreneur or company with any degree of protected intellectual property:

  1. Non-disclosure agreements must be re-written by legal counsel. Similar documents, such as confidentiality, proprietary information and secrecy agreements should be re-considered now, and all such contracts must be mutual. Employee and partnership forms require immediate updates.
  2. A “need to know” basis must be uniformly imposed to restrict access to information by non-key personnel.
  3. Different forms and types of knowledge about patentable concepts should be kept in separate storage, even on different computers. Drawings should be in one location, written descriptions in another. Working models must be separate from documents. All information technology resources must be password protected, isolated, and physically locked down.
  4. Loose lips may sink patentable ships. Idle discussions, any chatter, about concepts must stop.
  5. Presentations at meetings with venture capital people or bankers, suppliers, sub-contractors, etc., should proceed from a carefully controlled hierarchy of how much and what types of information to disclose. Presence of expert legal counsel is highly advisable.
  6. First-to-file has no legal precedent in U.S. courts, so do not “trust” outside parties. Protect all information.

Be cautious and file as soon as practical. And if you need help understanding the value of your patents and intellectual property, there are no better experts than OceanTomo, based here in Chicago.

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