Technology Transfer and OLD products

A little further discussion of a paragraph at the end of this post (last post)

So, we get a notice today from a Tech transfer office saying, politly and indirectly as these things do, "Your product is all over our patent". We get these letters on, essentially, a daily basis. Most are completly full of it and just seem like tech transfer offices fishing for money, hoping we license something without thinking. I actually don't understand them, but we (I....) look in to it, mutter about what a ludicrous stretch of the claims this is and move on....

The actually funny part about most of these letters is that they are for products, in general, that have been on the market for multiple years. This, for the most part, means that there really aren't big sales attributed to them. With exceptions, that form the basis of whole areas of the company, old products are just old. They are on the slow slope toward death, and the reviews of them include such calculations as "is is worth just making one big last batch and then discontinuing it?" and "How much does it cost to run the freezers on this?" and other such moribund conversations. (Note, that for the most part a business development person isn't in these meetings, so those looking for what I do for a living - > not this! Product managers/marketing get that fun). So - we get these notes about these moribund products. I dutifuly call them and ask to see what the problem is ( think - getting a speeding ticket "whats the problem officier?") and they spin some sort of story. I point out some problems with the story ("your smoking crack" is not something I say) and then we get down to the details of what they want. They ask for a big number. I don't laugh. I may mute the phone, but I don't laugh. I explain that it is a dying product and would they just like us to pull it from the market. This normally sort of shocks them, as this is not what is expected. Many will go away at this point and not come back. Some will drag the conversation on through several more calls just to make sure we really aren't infringing. Only once have I had to make good on that promise. They beleived we were infringing. I, and legal council, didn't. The product was doing $50k/yr down from a peak of like $600k/yr. They said "see you in court". We pulled the product that day. They were shocked. The follow on call was

• "you removed the product from sale"
• "Yes"
• "Why?"
• "You said it was infringing and you were going to sue us, so we have to license or remove. We have no choice."
• "We didn't want you to do that"
• "Huh? What were we supposed to do?"
• "License. We are more than willing to license"
• "But you wanted $300K upfront with a 10% royalty. We won't earn that back anytime soon. The product was dying, so we just sped up the process."
• "would you put it back if change the terms?"
• "1% - maybe, but probably not. That product was so close to death that any effort we put in to it makes it a dead product. labor is money, and the effort it will take to deal with this will make it a money loser"

The conversation went on for awhile. We never put the product back on the market, as it just wasn't worth the effort. Once we had taken it off, it would take legal paperwork to put it back on. The bill is too high.

So - Be careful what you wish for. If you are looking at a product from a company that isn't core to what they are doing, has been out for awhile, and hasn't really seen any advertising anytime recently - they are just letting it die it's nice slow death over in a corner so you probably can't hold them up for big money. Small money - maybe. Big money - Not happening.