Fordham 25 (Report 1): General Counsel Roudtable

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On a rainy Spring morning, the AmeriKat flew down from her perch in the Upper West Side to Fordham Law School for the first day of the 25th Anniversary celebrations of the Fordham IP Conference.  After a rousing speech from Professor Hugh Hansen and Deans Feerick and Diller (Fordham), the first session of the day opened with a round table of General Counsels including Mark Chandler (Senior Vice President and General Counsel, Cisco), Michael Fricklas (Executive Vice President, General Counsel, Viacom (as of a last Friday)), Mark Seeley (Senior Vice President and General Counsel, Elsevier) and Brad Smith (President and Chief Legal Officer, Microsoft).

All GCs stated that IP is important to their role, with Brad Smith explaining that at Microsoft they have monthly meetings to discuss strategic issues that present opportunities or threats and every week they go through a list of issues they are facing, which will always include some IP topics.  Brad said that IP really runs through the blood stream of every company in the technology sector.  You cannot separate it.  During the week of the Democratic National Convention, Microsoft was fighting off a nation-state attack.  The basis of the attack was a phishing attack using an internet domain that the group registered with the Microsoft name in order to falsely illicit customers to obtain tech support.  Microsoft had to take control of the domain.  They went through federal court under the Lanham Act and trespass to chattels to take control of the domain.  IP really touches on everything in the business.
In response to a question from Hugh as to whether they have any fun, Michael said that if you don't like stress a GC is not a job for you.  As a GC you need to structure a team which can solve most problems by themselves.  You should only be dealing with problems which requires more team brainpower to solve - those problems that do not have an obvious solution.  If you do not think that dealing with a complicated, difficult problem is fun than you should not consider a GC role.  A lot of the job is also "selling a solution" - getting an organization to execute a solution.  Mark Seeley and Brad said that all of the issues they work on are incredibly fun as the issues are all about society and technology.

Brad Smith (Microsoft)

Although people have to trust you and believe you are moving in the right direction, there is still a hierarchy so if there is a difference of opinion within the organization you don't stay at odds very long.  That often is resolved because the depth of knowledge (from the IP team) and the breadth of perspective (of the GC) come together to identify the best solution.  That is not to say that the breadth of perspective from the GC means there is no depth, but the GC's role is to identify how the IP issue is intersecting with other IP issues.  It is about pushing each other.  The question they asked recently at Microsoft is how much of their budget they need to spend on maintaining and prosecuting their patent portfolio.  The patent attorney team will of course say 120%, but the GC has to balance it all together.

Brad said that what he finds most interesting is how different IP feels in a time of flux and when in the center of controversy.  When the conference first started the issues were about copyright, then five years ago it was about patents and now its about copyright again.  IP is all about a rebalance of rights when technology progresses.  Michael says that there has to be more discussion about the balance on what the right protection is and where the optimal balance lies.  Not enough people are properly engaged on where that balance is and Congress seems to be locked out of that debate.  There is not a lot of rational discussion on this.  The Courts are being asked to weigh on technology they do not really understand and to opine on legislation written in a different era with which they wish not to interfere to greatly with.

In this environment, Michael said that he felt there was more that technology companies can do without undue cost or risk, but drawing that line is difficult.  There is a lot of fear of taking any additional action will result in a lot of unforeseen cost.  In the content business, a lot of people are making a lot of money building business on other people's efforts and there is not enough done to address this.  Statements that tech is anti IP is a political slogan.  What tech is really about is identifying the right balance for IP in order to progress science and the arts.  Whenever someone has a right, it stops someone else bringing a product to market.

Is Congress a problem solver?  If you believe in law, you have to go to Congress to fix it.  We all live in countries where the relative strength of branches of government ebbs and flows.  In even the gridlock of Congress in the past decade, they were still able to pass the America Invents Act.  You cannot imagine a world where the law stays healthy without work of Congress.  But people are frustrated, stated Brad, when Congress does not act in fields like cybersecurity and immigration.  Two or three years ago in Microsoft, we felt that the pendulum was coming back.  The number of lawsuits filed against Microsoft is down, the cost is down and the cost of settling is down.  Brad thinks the fact that Congress did not act last year when people wanted them to is not necessarily a bad thing.  Because the technology sector is for ever changing, it makes sense that incremental legislative changes are made.

Mark Chandler (Cisco)

However, Mark Seeley said that where there is a gap between legislative activity, the Courts should be stepping in.  Mark also stated that gridlock is not the normal rule for legislative bodies as Brussels has a very activist agenda for copyright reform.  Michael said that they are having a lot of success in Europe to draw the copyright line.

Can industry get together to solve problems?  Michael and Mark Chandler said that a lot of issues can be solved by companies, especially those that are too contentious for Congress.  Politicians who are looking for re-election, will not wish to get involved in those issues.  So industry has to look to other avenues where the investment of energy will be more useful.  To do so you need to identify the problem you are trying to solve, who is the best body to solve this and how do you go about organizing and implementing this solution.

In response to the role of the courts, Brad Smith said that what we have seen in the last 25 years is broadly the same that we have seen over the last 250 years.  It is the same story of settled law being unsettled by new technology which causes uncertainty and controversy.  All of this has required more from the Courts than Congress for the reasons already discussed.  The Courts have had to be more interventional.  The story is the reverse in Europe where the legislature and executive branch are doing more.  The Courts there then have to deal with new issues from new legislation.  Over time, Brad thinks they have largely been successful in reestablishing equilibrium.  Brad looks at the patent space in particular where five or six years ago there was enormous emotion and controversy hearing general counsel talk about patents (like someone was taking away their children).  We have seen a series of decisions from the Courts where you can praise or criticize the decisions, but equilibrium has been restored.

Michael commented that there is a lack of understanding of the technology and business implications of decisions from the Courts who make them.  Brad disagreed.  The biggest speed of technological change was in the 1800s where the inventions were totally transformative and yet the courts kept up.  Michael said that the shift from hardware to software where new business models can be implemented in moments because of software is also transformative (just in a different context).  Industry is also more complicated as it was in the 1800s and the Courts are reluctant to engage with this.  Brad said that the past is always clear and the future is always foggy - it is so clear to us now what the right answer was then and the future is always so full of uncertainty.

Hugh then asked what they look for in IP counsel?  Brad said you start by looking for what you would expect - an accomplished track record.  25 years later Brad says that fundamentally the most important quality is an enormous curiosity to learn as the field is constantly changing (changing not because solely of the factors in it) because of external factors - what is happening in the economy and in global relations.  You cannot be a great IP lawyer over time if you do not have a sense of curiosity and commitment to learn.  Brad said that the other thing is diversity - acknowledging the lack of it on the panel.  To benefit from the diversity of thought you need a diversity of backgrounds.