Key Insights on IP Management – Interview with Prof. Dr. Martin Bader – Black Friday Trademarks – Trump Guitars vs. Gibson Les Paul – IP Fridays – Episode 158

IP Fridays - your intellectual property podcast about trademarks, patents, designs and much more

You can find the profile of Prof. Martin Bader here:

https://www.thi.de/en/persons/prof-dr-oec-hsg-martin-bader

My co-host Ken Suzan and I are welcoming you to episode 158 of IP Fridays. Today’s interview guest is Prof. Martin Bader. In my view, he is THE expert when it comes to IP management and in particular patent management. He is consulting some of the top patent filers in the world and I can pick his brain today.

But before we jump into the interview, I have news for you!

For years, German retailers faced legal uncertainties when using the term “Black Friday” in promotions, as it was registered as a trademark. Unauthorized use risked costly cease-and-desist letters. However, after multiple legal challenges, the German Federal Court of Justice (BGH) confirmed that “Black Friday” is no longer protected as a trademark. This decision allows retailers to freely use the term in their marketing without fear of legal repercussions.

On November 25, 2024, the German Patent and Trade Mark Office (DPMA) began participating in WIPO’s Digital Access Service (DAS) as a depositing office for patents and utility models. This allows applicants to request priority documents electronically through WIPO DAS, enabling secure and efficient sharing of these documents with participating IP offices worldwide. Applicants can request electronic priority documents for free using Form A 9164 or opt for paper copies at a fee. Upon processing, the DPMA provides a confidential access code for retrieval of the documents via DAS.

On October 31, 2024, the European Commission fined Teva Pharmaceuticals €462.6 million for abusing its dominant market position to delay competition against its multiple sclerosis drug, Copaxone. The Commission determined that Teva misused the patent system by filing multiple divisional patents to extend Copaxone’s exclusivity and engaged in a systematic campaign to spread misleading information about a competing glatiramer acetate product, thereby hindering its market entry. This decision underscores the EU’s commitment to maintaining competitive markets in the pharmaceutical sector, ensuring affordable drug prices, and fostering innovation.

The Unified Patent Court’s Düsseldorf Local Division ruled that Aarke AB’s “Carbonator Pro” infringed SodaStream Industries Ltd.’s European Patent EP 1 793 917, which pertains to a device for carbonating liquids with pressurized gas. The court interpreted the term “flask” in the patent claims broadly, encompassing Aarke’s design despite differences from SodaStream’s illustrations. Aarke’s defense, invoking the “Gillette defense”—asserting that their product mirrored prior art and thus couldn’t infringe a valid patent—was rejected, as Aarke hadn’t filed a counterclaim challenging the patent’s validity. Consequently, the court granted SodaStream a permanent injunction against Aarke’s product in seven UPC member states, reinforcing the importance of precise claim interpretation and the limitations of the Gillette defense in infringement-only proceedings.

Gibson has issued a cease-and-desist letter to 16 Creative, the company behind the newly launched Trump Guitars, alleging that the design of their electric models infringes upon Gibson’s protected Les Paul body shape. The Trump-endorsed guitars, marketed as the “only guitar officially endorsed by President Donald J. Trump,” feature designs with slogans like “Make America Great Again” and are priced up to $11,500 for autographed versions. Gibson, known for vigorously protecting its intellectual property, has previously taken similar legal actions against other manufacturers to safeguard its iconic designs.

Key Insights on IP Management: Interview with Prof. Dr. Martin Bader

In a recent episode of IP Fridays, I had the pleasure of interviewing Prof. Dr. Martin Bader, an esteemed expert in intellectual property (IP) management and Professor of Technology and Management at the Technical University in Ingolstadt, Germany, as well as an Adjunct Professor at McGill University, Canada. Over his extensive career, Prof. Bader has consulted numerous companies, authored a standard book on patent management, and shared his expertise on navigating IP challenges in today’s dynamic business environment. Here are the key takeaways from our conversation:

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1. The Growing Importance of Innovation for SMEs

Prof. Bader emphasized that medium-sized enterprises (SMEs) are under increasing pressure to innovate. Customers are less willing to pay premium prices, and SMEs face fierce competition from global players, particularly from emerging markets like China and India. This situation is compounded by technological shifts, such as digitalization and artificial intelligence (AI), which require companies to rethink their value chains and adapt their IP strategies accordingly.

For instance, SMEs in engineering must shift focus from traditional hardware protection to safeguarding services and software. Companies that fail to adapt risk losing ground to competitors who understand the new value drivers.

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2. Overcoming the Challenges of IP Collection and Management

One striking insight was the difficulty SMEs face in identifying and managing IP effectively. Prof. Bader noted that many potential inventors within companies don’t even realize the value of their innovations, especially in areas like software development or new business models. Without an IP-savvy management team, companies may miss out on critical opportunities.

Large corporations often struggle with similar challenges, particularly in global organizations where identifying inventors across departments and geographies is daunting. Prof. Bader stressed the importance of fostering an internal culture that encourages innovation and supports IP awareness across all levels of the organization.

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3. Lessons from 20 Years of Patent Management

While the fundamentals of IP strategy have remained consistent—focusing on strategy, implementation, and execution—the dynamics of value creation have shifted dramatically. Prof. Bader highlighted that companies now need to integrate IP into agile project teams and adapt their processes to keep up with technological advancements, such as AI-driven innovations.

He also warned against relying entirely on external law firms for IP management. While external advisors are valuable, companies must build internal IP competencies to effectively steer their strategies and ensure alignment with long-term goals.

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4. Prof. Bader’s Top Three Tips for SMEs

For medium-sized companies looking to improve their IP portfolios, Prof. Bader offered the following advice:

1. Take IP seriously: Management must understand IP’s value, not just as a cost but as a strategic tool for mitigating risks and creating opportunities.
2. Protect where value is created: Shift focus to protecting software, services, or systems rather than just traditional engineering outputs. Use a combination of formal and informal protection mechanisms to safeguard innovation comprehensively.
3. Develop internal IP capabilities: Build a robust internal IP function with dedicated processes and resources. Avoid outsourcing everything; instead, balance internal and external efforts to maintain strategic control.

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5. What Investors Look for in IP

Investors and corporations evaluating startups place significant importance on IP. Prof. Bader pointed out that beyond having patents, the strength and relevance of those patents to the market and competitors are crucial. Investors also value teams with IP expertise and strategies that align with their business models. Startups without a strong understanding of their IP landscape may face challenges in attracting serious investment.

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Final Thoughts

Prof. Bader’s insights underscore the evolving nature of IP management and the need for companies to stay proactive and adaptive. SMEs, in particular, must recognize the importance of IP as a driver of value creation and competitiveness. By building internal capabilities, focusing on where value is created, and aligning IP strategies with business goals, companies can position themselves for success in today’s fast-changing market.

If you’d like to learn more or connect with Prof. Martin Bader, he’s available on LinkedIn. For the full interview, tune in to the latest episode of IP Fridays.

Transcript:

Dr. Rolf Claessen: Today’s interview guest is Professor Dr. Martin Bader. He is a Professor of Technology and Management and Entrepreneurship at the Technical University in Ingolstadt, Germany, and an Adjunct Professor at McGill University in Quebec, Canada. He is the founder of BGW IP in St. Gallen, Switzerland, and Chairman of the Supervisory Board of BGW Management Advisory Group in Switzerland. Before that, he held several industry positions at MTU, ABB, Siemens, and Infineon, where he served as Vice President and Chief IP Counsel. Most importantly, he is an expert in IP management. Thank you very much for being on the show.

Prof. Martin Bader: Yeah, thank you for your invitation.

Dr. Rolf Claessen: You are the expert, in my view, in patent management, and you are the author of the standard book on patent management, now in its fifth edition. For over 20 years, you’ve been distilling advisory and research insights into practical takeaways and consulting with many companies in this field. What are the top challenges for medium-sized technology-driven companies, let’s say with 500 employees, compared to the top challenges for large corporations?

Prof. Martin Bader: Thank you for the introduction and the first question. The challenges for SMEs today are significant. One major challenge is innovation. European SMEs, in particular, are under pressure to remain innovative. Customers no longer want to pay top prices for top quality, which increases the need for these companies to innovate continuously. This challenge is compounded by technological changes, like digitalization, which forced many SMEs to rethink their value chains and adapt their IP strategies. For instance, a shift from protecting static machines to focusing on services and software has been a major change.

Additionally, globalization has brought increased competition from emerging countries like China and India, adding further cost pressure, particularly for Swiss companies dealing with unfavorable currency exchange rates. Compared to large corporations, SMEs face a more significant struggle in maintaining a strong IP position while managing resources efficiently. This includes challenges in identifying inventions, particularly in new areas like digitalization, where traditional R&D methods might not capture the full spectrum of innovation happening in software or services.

Dr. Rolf Claessen: What do you think about collecting ideas or new inventions—do you think it is more difficult for smaller companies or for large corporations?

Prof. Martin Bader: I have a quote from a global corporation executive who said, “You don’t know how lucky you are if you know where your inventors are.” The challenge lies in finding inventors and inventions that may not be obvious, especially in areas like software development or new business models, where employees might not traditionally think of themselves as contributors to IP. This issue is compounded by a lack of IP-savvy management, which may miss out on opportunities in these emerging areas.

Dr. Rolf Claessen: What are the topics that have remained the same in IP management over the past 20 years, and what has changed the most?

Prof. Martin Bader: The foundational structure, based on the St. Gallen Management Model—strategy, conceptual, and implementation levels—has stayed consistent. However, the main change is that SMEs have become more familiar with basic IP tools, like patents, trademarks, and trade secrets. Yet, as value creation shifts from traditional engineering to software, services, and systems, SMEs need to adapt their IP strategies to these new realities. Companies also need to be proactive in integrating IP functions into agile project teams and ensuring they keep up with technological advancements, such as AI, which require both internal expertise and efficient use of external advisors.

Dr. Rolf Claessen: What are your three most important tips for medium-sized companies to improve their IP portfolios and IP management?

Prof. Martin Bader: First, take IP seriously. Management must understand both risks and opportunities, and not just view IP as a cost. Second, focus on protecting where value is truly created—this may now be in services or software rather than traditional engineering. Third, develop an internal IP function with proper processes and organizational structures. Avoid relying entirely on external law firms; instead, actively manage and steer outsourced activities to ensure they align with your company’s strategic goals.

Dr. Rolf Claessen: Thank you for these insights. If listeners want to reach you, where can they find you?

Prof. Martin Bader: The easiest way is via LinkedIn. You can find me under Martin Bader, and my email is also available there or via my affiliations.

Dr. Rolf Claessen: Thank you very much for being on IP Fridays.

Prof. Martin Bader: Thank you for the opportunity to share my thoughts.