1. @watermark Do You Have Freedom to Operate? Dr Tania Obranovich B.Sc. (Hons), Ph.D., LL.B., Dip IPP (IPTA) Special Counsel © watermark

2. What is Freedom to Operate? The ability to proceed with research, development and/or commercial activity without infringing a third party’s valid IP rights IP rights - Patents - Trademark - Designs - Plant Breeder’s Rights etc Considered on a jurisdiction by jurisdiction basis

3. Third Party IP Rights vs Your IP Rights Two separate and distinct sets of rights FTO relates to your ability to use technology owned by a third party without infringing that third party’s IP rights to that technology Securing and exercising your own IP rights does not provide a defence to infringement Securing your own IP rights may create a FTO issue for a third party wanting to use your technology

4. What type of activity requires FTO? Research -however, consider research use and safe harbour/Bolar exemptions -existence and scope of exemption varies from jurisdiction to jurisdiction Commercial activity -beware limited licences granted with commercially available kits and reagents Non-commercial activity (eg. pro bono/free services) Filing and prosecuting a patent application which details/recommends using third party proprietary IP is not an infringement of that IP

5. Why is it necessary to ensure that you have FTO? Need to know where your organisation stands -due diligence -risk management Can impact on product development Can impact on value of company/technology Capital raising/IPO implications Forewarned is forearmed -assess risks -manage risks

6. FTO Searching Entirely different to novelty searching in terms of its focus and execution Can be time consuming and expensive Need to balance complexity / expense against outcome sought -i.e. budget vs risk mitigation FTO can never be determined with absolute certainty. It is a risk management tool to provide the best estimate of FTO relative to the depth of analysis which is performed

7. FTO Searching Determine if a third party has filed a patent claiming the technology you wish to use Only patent literature relevant Only the scope of what is claimed is relevant Only granted claims can create a FTO issue Look at expiry date of patent

8. FTO Searching Beware the complexity of considering a published patent application which is still under prosecution and therefore not yet granted since claim scope not finalised Patent applications are typically drafted with broader claims than are ultimately granted Novelty and inventive step are still under consideration Once initial subject matter search completed and analysed, perform patent family and status search of relevant patent documents

9. FTO Searching – additional issues to consider 18 month non-publication blackout Timing of Search -ideally early -expensive therefore early not always realistic -technology focus and/or markets of interest can change therefore a later search can be more relevant -calculated infringement risk during research stage

10. Once you have the FTO Report Identify the nature and scope of the risks Evaluate options and address risks Issues such as strong vs weak patent or application vs granted patent status are very significant when deciding strategy going forward

11. Once you have the FTO Report Strategies for obtaining FTO  design around to avoid infringement  wait for patent to expire  watch a patent application, file 3 rd party observations, oppose grant  carry out activity in another, patent free territory  argue non-infringement  invalidate patent or render patent unenforceable in court i.e. “clear the way”  negotiate a licence/assignment  continue your activities and wait to receive a Letter of Demand (risky)  cross-licencing opportunity

12. Miscellaneous FTO Points Put others on notice of existence of your IP Umbrella patents vs selection patents: cross-licencing Patent portfolio structuring to discourage third party validity challenges and encourage licencing

13. Thank you Contact: Dr Tania Obranovich 613 98191664 t.obranovich@watermark.com.au www.watermark.com.au © watermark Do you have freedom to operate? (May 2016)