Nearly every patent practitioner has been impacted by the U.S. Supreme Court’s decision in Alice Corp. v. CLS Bank International, 134 S.Ct. 2347 (2014). Alice applied the two-part eligibility test set forth in Mayo Collaborative Services v. Prometheus Labs, 132 S.Ct. 1289 (2014), i.e., is the claim directed to ineligible subject matter and, if so, is there an inventive concept in the claim that amounts to something significantly more than the mere ineligible subject matter? In Alice, the answer was no on both counts. GT attorneys James DeCarlo, Nicholas Martin, and James Ryerson discuss this and other recent decisions as well as strategies patent litigators and prosecutors should consider in dealing with eligibility challenges in their recent article “Patent Eligibility After ‘Alice.’”
Following the recent Supreme Court decisions in Alice Corp., Myriad, and Mayo which invalidated an array of claims under 35 U.S.C. § 101, patent subject matter eligibility has become a closely watched and debated issue. In its most recent attempt to decipher these decisions and apply them in patent examination, on May 4, 2016, the U.S. Patent and Trademark Office (“USPTO”) issued a Subject Matter Eligibility Update (“May 2016 Update”) May 4, 2016. The May 2016 Update provides a memorandum to the Patent Examining Corps on best practices in formulating a subject matter eligibility rejection and evaluating the applicant’s response, along with additional subject matter eligibility examples in the life sciences area.
In formulating a § 101 rejection, examiners should, according to the memorandum:
(1) identify the judicial exception (i.e., abstract idea, law of nature, or natural product) by referring to what is recited (i.e., set forth or described) in the claim and explain why it is considered an exception;
(2) identify any additional elements (specifically point to claim features/limitations/steps) recited in the claim beyond the identified judicial exception; and
(3) explain the reason(s) that the additional elements taken individually, and also taken as a combination, do not result in the claim as a whole amounting to significantly more than the judicial exception.
By 2050, the global population is expected to increase to 9 billion people — a dramatic increase of more than 35 percent. Given scarce natural resources and the uncertainties of climate change, feeding that growing population means food production will need to increase by 70 percent, according to the Food and Agriculture Organization.
Florida, where agriculture ranks as the second-largest industry, is perfectly positioned to take the lead in combating world hunger through investments in agricultural research. One strategy for doing so involves attracting innovative agricultural technology companies to the market. There is no better ally to enlist in such an effort than the state of Israel, which is known for its innovation in this area. Many of these Israeli food and agricultural technology companies are actively seeking opportunities for U.S. expansion.
Israel has been investing in food and agriculture innovation since its inception 68 years ago. The result: the country is a leader in this area, despite the fact that the geography of Israel is not naturally conducive to agriculture. Israel’s climate, geography and lack of water resources, provide many parallels that would be relevant to Florida. Those success stories include leading Israeli Agtech companies like Kaiima, a genetics and breeding company that utilizes technology to enhance crop productivity. The work of Netafim, a leader in smart drip and micro irrigation solutions, helps to reduce water usage and increase yields. And, Afimilk provides technology that helps dairy farmers increase yields and profitability.
The past few years have seen an uptick in new accelerator and incubator programs that are focused on helping startups launch and grow. Participating in one of these programs can be advantageous for an emerging business looking for expert insight, seed money, venture capital, or market exposure. But not all are created equal. While most programs provide benefits such as funding, mentorship, and access to potential investors, they are not a guarantee of success. A positive experience depends on setting realistic expectations and understanding what these programs can and cannot do.
Choosing an incubator or an accelerator program depends entirely on you, your business, and what you want out of the experience. An entrepreneur should do proper research into the broad range of options to determine what program is the right fit and consult with counsel to ensure that an appropriate program is chosen.
Difference Between Accelerators and Incubators
Incubators and accelerators both prepare companies for growth. As a result, the terms “accelerator” and “incubator” can sometimes be used interchangeably. They both help companies grow by providing guidance and mentorship, but in slightly different ways, and there are subtle but important differences between these types of programs.
As the term implies, the purpose of an incubator program is to “incubate” or nurture a startup from a very early stage, providing the young company with the necessary tools to develop, such as office space, business skills training, access to financing and professional networks, and advice. The goal is to help the company develop to a point that it can stand on its own feet. Incubators are typically sponsored or run by VC firms, government entities, or major corporations. Incubators can sometimes take equity in the venture, and if they do, it is usually a small amount, since they typically do not provide upfront capital.
According to the National Business Incubation Association (NBIA), “The most common goals of incubation programs are creating jobs in a community, enhancing a community’s entrepreneurial climate, retaining businesses in a community, building or accelerating growth in a local industry, and diversifying local economies.” An incubator program typically does not have a predetermined end or a competition element, and tends to be less structured than accelerators. Overall, incubators are a longer-term proposition and take their portfolio businesses through all stages of their lifecycles. In most cases, startups accepted into incubator programs work with other companies in a co-working environment and may have a monthly lease program.
Accelerator programs usually focus on helping a business that may be beyond the incubator stage, and that may be ready for sustained growth. The accelerator program is usually set up to “accelerate” a business with an intense program (i.e., one to six months), through which many resources are available. The entrepreneur may receive a small amount of capital, office space, mentorship, and access to business and legal advisors in exchange for some equity in the company. The ultimate goal of an accelerator is to support the startup to the point of attracting venture capital and angel investment in a short period of time. Some common and increasingly popular accelerator programs include MassChallenge, TechStars, and Y-Combinators.
One of the best ways to find an accelerator is to explore platforms for startups such as AngelList. And, for a closer look at the data on each accelerator program, visit www.seed-DB.com, an online database which tracks over 200 accelerators worldwide and nearly 6,000 startups that have emerged from them. Among the listings you will find figures for dollars in funding, dollars in exits, and jobs created by each company.
Both accelerators and incubators want your company to succeed. For accelerators, this is especially important since they take a percentage of your business, and only make money if you make money.
Finding the Right Match
Finding the appropriate program can depend on what stage you are in your business. You should carefully consider where you are in your company’s evolution and do your due diligence before applying to any program. Consider the following questions:
- What are your goals?
Consider why you are applying to an accelerator or incubator. Are you most interested in the mentorship, advice, and coaching, or the seed capital and access to follow-on investment? Does working in a community of fellow entrepreneurs appeal to you, or maybe you need more privacy? Understanding these primary drivers will help you choose the right program and get the most out of your experience.
- Record of success
Research the program’s team. Who is running the program and who is backing it? You will want to know that the program has a successful track record in your industry sector. Additionally, you should consider looking for a program that has effectively helped similar businesses launch, secure funding, or ensure success.
- Understand the niche area for the accelerator or incubator
Today, many programs focus on a particular sector, such as health care, biotech, or interactive media. Be sure the accelerator or incubator mission aligns with your business goals.
- Do you need mentors?
Some programs offer a high level of oversight and mentorship, while others are less involved. If you are looking for access to business and legal advisors, then you should look for a program that has a strong mentorship element. And, don’t forget that advice and mentorship can come from other entrepreneurs, which is partly why you want to get into the best accelerators.
- Are you willing to give up equity in the company?
An entrepreneur considering an incubator versus an accelerator should weigh the pros and cons of giving up equity in the company in exchange for the program’s services and support.
Consider the location of the accelerator/incubator in the context of where you want to build your business. If you are developing video gaming software, for example, you may want to explore programs in regions that are rich in interactive media innovation such as Austin, Texas, or Boston. Keep in mind that some programs have very specific “place of business” requirements.
Accelerator and incubator programs can give you much needed financial assistance, office space or equipment, and expert mentorship. In the end, whichever path you choose, it is important to remain committed to the program in order to reap the utmost benefit.
The 261-page final draft of the EU General Data Protection Regulation (GDPR), which replaces Directive 95/46/EC (Directive), was formally approved by the EU Parliament on April 14, 2016. The document is expected to be published in the Official Journal of the European Union (EU) in June, and to enter into force 20 days thereafter. The GDPR will apply, and enforcement will commence, two years from the date of entry into force, i.e., approximately in early July 2018. The repeal of the Directive will take effect as of the date when the GDPR begins to apply.
The GDPR is not just an update of a 20-year old directive that was designed at the dawn of the Internet era, and that was based on privacy principles published by the Organization for Economic Co-operation and Development (OECD) in the early 1980s. The approval of the GDPR is a significant development in the shaping of the law of privacy and data protection in the European Union as a cohesive, homogeneous whole, where one single law becomes the primary vehicle to govern the activities of very diverse countries in a particular domain.
It is time for companies that fall within the scope of the new GDPR to start preparing for the transition. This GT Alert focuses primarily on the obligations faced by companies whose principal business establishment is located outside the EU and the European Economic Area (EEA).
In a 58-page opinion published April 13, 2016, the influential European Union Article 29 Working Party (WP29), which includes representatives of the data protection authorities of the 28 EU Member States, expressed significant concerns with respect to the terms of the proposed EU-US Privacy Shield that is intended to replace the EU-US Safe Harbor.
The WP29 made numerous critiques to the proposed EU-US Privacy Shield framework. Some of which include, for example, the lack of consistency between the principles set forth in the Privacy Shield documents and the fundamental EU Data Protection principles outlined in the 1995 EU Data Protection Directive, the proposed EU General Data Protection Regulation, and related documents.
The WP29 group also requested clearer restrictions for the onward transfer of personal information that occurs after personal data of EU residents is transferred to the US. The WP29 is especially concerned with the subsequent transfer of data to a third country, outside the United States. In addition, the WP29 continues to be concerned about the effect, scope, and effectiveness of the measures proposed to address activities of law enforcement and intelligence agencies, often described as a “massive collection” of data.
At the most recent SXSW, Hanson Robotics, based in Plano, TX, debuted its latest personal robot – Sophia. With lifelike skin that is made from patented silicon, Sophia can emulate more than 62 facial expressions. Cameras inside her “eyes,” sophisticated computer algorithms, and a combination of voice recognition technology and other tools enable Sophia to “see” and “think.” Sophia is just the latest example of major advances in the development of machines striving to attain human “characteristics,” “intelligence,” and “awareness”.
Creepy? Maybe. Predestined? Definitely.
Life Imitating Fiction
Arguably, the notion of Artificial Intelligence (AI) or Cognitive Computing has been around since Frankenstein was published in 1818. For example, consider the Star Trek series, especially The Next Generation, where AI is prevalent. The android DATA was imparted with human-level intelligence and expertise by his creator, Dr. Soong. Albeit fictional, DATA is an example of a machine achieving human-level awareness. Conversely, Seven of Nine (or more specifically the Borg/Borg Collective) is essentially a human or humanoid that has been assimilated and made more machine-like, striving for efficiency and perfection of a machine. The Borg individual is given artificial limbs, eyes, and other body parts, as well as implants (for example, brain implants), so that each Borg individual can communicate with the Collective and the Borg Queen.
Known to many as the “Start-up Nation,” Israel has also been dubbed “Silicon Wadi”; ranking 7th amongst all countries in venture capital activity outside of the U.S. In 2015 alone, there were 326 VC investments in Israel, approximately 60% of which were in the information technology sector. In a recent article entitled Inside Silicon Wadi: Why VC in Israel is a booming business, Kevin Dowd, a writer for Pitchbook, highlighted and explained Israel’s prominent position in the VC world.
Dowd pointed to two key factors in Israel’s success in obtaining such a large portion of VC investments. First, in 1993 the Israeli government implemented the “Yozma” program, which provided tax incentives to foreign investors and matched any foreign investment in an Israeli company with government funds. Subsequently, in the early 2000s several government reforms also helped in relaxing what was a more centralized economy, making Israel much friendlier to VC investment. Second, Israel’s high-tech market is constantly producing more companies with innovative ideas and products for companies to invest in. With the highest number of tech startups per capita in the world, Israel is ripe for venture capital activity.
Greenberg Traurig is the only major international law firm with a multidisciplinary, registered office in Tel Aviv and serves as a gateway for Israeli businesses and entrepreneurs seeking opportunities around the world, as well as for companies exploring opportunities within Israel. The Tel Aviv location offers clients the global reach of Greenberg Traurig’s international network, connecting Israel to major commercial centers across the globe. GT Tel Aviv is deeply involved in the venture capital world and has connected U.S. investors with Israeli companies as well as helped Israeli companies raise money and increase operations abroad.
Today DHS released an advanced copy of its final rule allowing foreign students with degrees in Science, Technology, Engineering, and Mathematics (STEM) to extend their Optional Practical Training (OPT) for an additional 24 months. DHS will publish the final rule in the Federal Register this Friday. The rule will go into effect on May 10. Beginning May 10, students who are currently in the U.S. under their 17-month STEM OPT extension will be able to file to extend their OPT for an additional 7 months.
This rule gives foreign students with STEM degrees the opportunity to work in the United States for up to 36 months. The extended time period offers a number of benefits to foreign students and U.S. employers that wish to hire them. By defining fields of study that qualify for STEM in accordance with the Department of Education’s Classification of Instructional Program (CIP) categories, the new rule expands on the permissible fields of study that were authorized under the old STEM rule. Notably, increasing OPT work authorization from 29 months to 36 months will give F-1 STEM OPT holders more chances at being selected for an H-1B visa number in the annual H-1B lottery. The rule also redresses the U.S. District Court for the District of Columbia’s vacatur of the 2008, 17-month Optional Practical Training (OPT) STEM Extension rule, and part of the contentious legal battle surrounding the overall validity of the STEM extension program, which is expected to be decided by a Federal court in May.
Greenberg Traurig will host the First Annual International Entrepreneurs Summit of Philadelphia at the International House Philadelphia on March 22. The First Annual International Entrepreneurs Summit of Philadelphia is an opportunity for foreign entrepreneurs and international students, including scholars and researchers interested in starting a business, to learn about launching a venture in the region. The event will include:
- A panel of leaders to discuss topics relevant to international entrepreneurs, including raising capital, immigration matters, local resources and more;
- An opportunity to hear from international entrepreneurs who have already launched businesses in the region; and
- Networking with local entrepreneurs, investors, government representatives and other professionals.
To register for this event click here.