United States & Canada

More clean technology patents are issuing than ever before. The Clean Energy Patent Growth Index (CEPGI) indicates that more clean technology U.S. patents issued in 2008 than any other year since the CEPGI started tracking patent issuance in 2002.

The CEPGI provides an indication of the trend of clean technology innovation by tracking how many clean technology related U.S. patents issue each year in the following technology sectors: Fuel Cells, Hydroelectric, Solar, Wind, Hybrid/electric vehicles, Tidal/wave, Geothermal, Biomass/biofuels and other clean renewable energy.

Among those issued clean technology patents, the dominant technology is fuel cells, followed by wind and solar. The top clean technology patent owners include Honda, General Motors, UTC Power, Ballard Power, and Toyota. Interestingly, automobile companies account for five of the top-ten clean technology patent owners. Patent applicants from Canada were granted the fifth largest number of clean technology U.S. patents, behind the U.S., Japan, Germany and South Korea.

Although the CEPGI tracks how many clean technology U.S. patents issue, Canadian patent issuance tends to follow a similar trend, albeit with a delay. For example, Cyclone Power Technologies recently announced that the Canadian Intellectual Property Office issued a Notice of Allowance on their application directed to their “cyclone engine”, an eco-friendly heat regenerative engine that was named the 2008 invention of the year by Popular Science magazine. The corresponding U.S. patent issued almost 3 years earlier.

National patent offices are adopting clean technology patent initiatives that may spur on the trend of increasing clean technology patenting. For example, the U.K. Intellectual Property Office recently announced an initiative that puts patent applications directed to inventions with an environmental benefit on the patent prosecution fast track.

Litigation

An increase in clean technology patent issuance naturally leads to an increase in the risk of related litigation.

For example, Pax Scientific recently sued the company Re:Thought in a U.S. federal court, alleging that their Biometric Horizontal Wind Axis Turbine infringes Pax’s U.S. Patent No. 5,934,877. Their patent is directed to a rotor with its surface configured in the shape of shells of the phylum Mollusca according to a logarithmic curve known as the Fibonacci Progression. Although there is no corresponding Canadian lawsuit, a corresponding patent has issued as Canadian Patent No. 2,226,486. As another example, the drive trains in Toyota’s hybrid vehicles were found to infringe U.S. Patent No. 5,343,970, owned by hybrid technology company Paice LLC. Toyota was sanctioned with a $4.3 million jury verdict and must also pay an ongoing royalty rate of about $98 per infringing vehicle.

Clean technology companies can help reduce the risk of costly litigation by establishing a litigation patent watch. A litigation patent watch involves periodically run searches for issued patents and litigation activity of interest based on technology areas, competitor names and/or known prolific individual inventors. In this way litigious patent holders can be identified and if the watch is conducted in foreign jurisdictions, such as the U.S., a company can determine whether a relevant foreign patent is being asserted in a foreign court. A Canadian company could then monitor corresponding Canadian patents or applications in anticipation of a corresponding Canadian lawsuit.

Also, clean technology companies can take proactive steps to develop a clean technology patent portfolio, which can in turn generate licensing revenue and strategic bargaining chips that can reduce the risk of future litigation. An internal IP audit of existing and new products can identify technologies vital to current and future operations. Once identified, patent applications can be filed to secure rights in those technologies. Acquisition of relevant patent applications and issued patents also can appreciably increase a company’s value.

The CEPGI is maintained by the U.S. patent law firm Heslin Rothenberg Farley & Mesiti PC, and is explained in more detail at http://cepgi.typepad.com/.