Conference programme

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Delegates are invited to meet and discuss with the poster presenters during the poster presentation sessions between 10:30-11:30 and 16:00-17:00 on Thursday, 19 November 2015.

Lead Session Chair:
Stephan Barth, ForWind - Center for Wind Energy Research, Germany
Philip Totaro Totaro & Associates, Germany
Co-authors:
Philip Totaro (1) F
(1) Totaro & Associates, Hamburg, Germany

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Presenter's biography

Biographies are supplied directly by presenters at EWEA 2015 and are published here unedited

Philip Totaro is the Founder and CEO of Totaro & Associates, a market research and innovation strategy consulting firm based in Hamburg, Germany. Mr.
Totaro is regarded worldwide as the foremost expert on wind industry technology and intellectual property matters. Mr. Totaro has a Bachelor's Degree in
Aerospace Engineering and over 12 years of experience in strategic planning as well as creating and protecting intellectual capital. He has previously
worked for General Electric, United Technologies Corporation, and most recently was head of intellectual property and competitive assessment for Clipper
Windpower. He has helped cultivate and disposition over 500 innovations, and his assessments have led to over 300 issued patents. His strategic market
analysis has led to the funding justification of over US$500M in R&D investment and the development of multi-million dollar product and service offerings.
He has provided legal and technical due diligence
for over US$1.5B in M&A.


Poster

Poster Download poster (34.28 MB)

Abstract

The Need for Independent IPR Certification

Introduction

Presently, independent intellectual property infringement risk certification is not mandated in the wind industry, or virtually any other industry where project finance is utilized. Most turbine OEMs provide their own data and validation to turbine purchasers and project financiers, but only if asked, and typically only in matters related to patent infringement litigation recognized in the public domain.

This validation from the turbine manufacturer is not an independent assessment. What most turbine OEMs do not realize or have not publicized, is that they are all infringing on one another. This information is typically ignored unless addressed to a turbine manufacturer or known by an OEM. If it is known, the potential infringement is typically kept quiet unless strategic considerations are at play.

Additionally, turbine manufacturers are introducing another level of risk for project financiers and turbine purchasers by not providing full indemnity in turbine supply contracts specifically to limit their own liability. Most turbine OEMs do, however, mandate full indemnity from their sub-component suppliers or those sub-component suppliers are barred from participation in a competitive bid or sole source award for key components in the wind turbine.

Approach

The process of IPR infringement risk mitigation works by starting off with a comprehensive patent landscape and catalogue of IPR and technology in the industry. This is typically the top failing of IP search firms and law firms, because lack of industry domain expertise and lack of technical subject matter expertise usually leaves an incomplete set of results for the freedom to operate (FTO) review.

From a study which was conducted, conventional patent search tools and methods were compared to a wind patent landscape which had been rigorously reviewed. Results on one category of technology indicate that the conventional patent search methodology employed by IP search firms or law firms will result in an incomplete set of results, false positive results, and results which require significant further study and examination. This last step is what leads to expensive costs of FTOs, and is typically one reason why most companies do not engage outside parties to help facilitate IPR infringement risk mitigation at all.

Main body of abstract

There was a point in time at which independent technical certification of a wind turbine architecture was not mandated. Nowadays, third-party technical certification is a necessity to secure project finance and a sensible precaution by a turbine manufacturer to avoid downstream wind project liabilities.

Property and casualty insurance against such downstream problems has emerged to close any gaps which may have been missed during the project due-diligence and the independent technical certification. These insurance policies are predicated on an operational track record of turbines and benchmarking against other manufacturers (as well as other industries) in regards to quantifiable failure rates, scope of liability claims, and contractual obligations of industrial equipment manufacturers, equipment purchasers and those who finance such projects.

A solution is required for risks related to potential IP infringement.

In a case study which is presented here, one particular turbine manufacturer was seeking product validation for new market entry. The composite risk score was quantified at 18 of 3,200 patents being high risk, indicating immediate mitigation action was required on those matters.

The detailed risk mitigation of the 18 identified patents found that 5 of the patents had extremely broad claim breadth and were not actually being utilized, while the other 13 patents were deemed invalid. This clean bill of health enabled the turbine manufacturer to obtain an intellectual property indemnity insurance policy and qualify for preferred project financing.

Conclusion

Cost effective visibility to IPR infringement liability is possible and risk mitigation will bring the wind industry in-line with the mainstream.


Learning objectives
Gain visibility to IP infringement risks, understand the mitigation protocol and have confidence to provide finance on a project that will not be halted for an arbitrary patent infringement liability or injunction.