Alberto Q. Amatong, Jr., Attorney at Amatong|McCoy LLC discusses the issues that arise when dealing with intellectual property.
Please excuse any typos in this hasty transcript.
Matt Register: Hey, guys, welcome back to the show. Texas Business Radio, texasbusinessradio.com is the website, 844-814-8144 is our 24 hour call in line, that means get your calls in now. Get them in later, get them in at 3:00 in the morning, I really don’t have an opinion on it. We’re going to get the experts in here to get those questions answered.
I’m your host, Matt Register. Jay Curry’s the one sitting over there in the co-host chair, and we’re talking about intellectual property. There’s a lot of companies in Texas that have some kind of technology that they rely on for their business, and knowing how to protect it, know how to make sure that you’re not infringing on somebody else’s patent, it becomes important.
And we were talking during the break about this with a little discussion about intellectual property, and guys, as CEOs of companies, I know that you are constantly fighting the priority list of things that need money, right? And you’re constantly trying to fund your company, constantly trying to grow your company. The intellectual property side of it is one that you probably should not ignore. It’s one that becomes very important as you’re growing your company and you’re developing your assets in your company. What do you think about that, Jay?
Jay Curry: Well, I agree with you, Matt. You can’t ignore it, on the other hand don’t go try to do it yourself. This is very complicated stuff, it really takes expertise.
Matt Register: Well, and the good news is there are experts out there-
Jay Curry: Absolutely.
Matt Register: … that can quickly take a look at your company and identify what it is you need. One of whom is in the studio right now. Alberto Amatong, Jr. is an attorney with Amatong-McCoy out of Houston. Alberto, welcome to the show, sir.
Alberto Amatong, Jr.: Thank you. Good afternoon.
Matt Register: Talk to me a little bit about Amatong-McCoy. What do you do and who do you do it to?
Alberto Amatong, Jr.: Well, we’re attorneys, but we specialize in intellectual property, IP, patents, trademarks, copyrights, trade secrets. Two partners in the firm, myself and Mike McCoy. Mike and I started at Fulbright and Jaworski, a large firm, and we had been talking about opening up our own shop, something smaller, but also something that had the capacity to give more focused attention to businesses and also give them competitive rates.
Matt Register: Well, I’m not sure if you’re aware of this, but being in Houston, there’s more than a couple engineers in Houston, and they tend to invent things. They tend to start companies around said inventions. When do they need to get somebody like you involved, because some of these inventions, we’ve had patent guys on here before, IP attorneys, and it’s always a toss up of do we patent it, do we make a trade secret, how in the world do we actually go and protect this? When do you recommend people pick up the phone and call when they’re getting ready to start a company like this?
Alberto Amatong, Jr.: It’s going to be at an early stage in the process. Once, if you’re talking about multiple people, once they’ve got a business idea, and the framework for it, then I think at that point they’re also concerned about or want to know what assets do we have? What technology are we going to be selling or deriving products from? At that point I think they would talk to me about how they could enhance that technology, those assets. Usually that means patents or trade secrets, and further to that, what they need to do to ensure that they are creating it and preserving their right to get patents and trademarks over copyrights.
Matt Register: Well, sometimes a patent by itself isn’t enough, right? There are certain things you got to do once you get that patent, preserve it and make sure that your period of time that you have exclusivity to be able to do this is preserved and you’re not doing something on accident that cuts that short, right?
Alberto Amatong, Jr.: Exactly. In fact, a patent doesn’t start out as a patent, it’s an invention or it’s an idea. So I will advise or I will assess whether that invention is patentable. Then one of the first things we’ll look at is ownership. Who’s creating it and does the company have the documentation or the agreements in place to ensure that they own it? Then, I think as we talked in the break, you can lose an invention or you lose your right to obtain a patent. So there are steps or things that they need to do, or not do, to preserve that right.
Matt Register: Well, I promise you, most people don’t know exactly what those steps are. I mean, this is a complex process, right?
Alberto Amatong, Jr.: Yes. It’s very nuanced, especially the patent side of things.
Jay Curry: So we’ve talked a little bit about engineers, and that’s absolutely right. Engineers tend to invent things and then they want to protect them, but I worked with a couple CEOs that have been around for a while, their companies are pretty nice, but they’ve decided to overcome the ups and downs of the oil business, they need to expand, they started R&D operations. When you do something like that, shouldn’t you come right in on that? What research and development are they doing, and what’s going to end up being patented and not patentable?
Alberto Amatong, Jr.: Yes. The first thing is recognize where that IP might be coming from. And also, again, ensure ownership, so you want to make sure if it’s independent contractors, that the independent contract agreements have clauses in place that transfers the ownership of the IP to the company.
Jay Curry: What about employees, though? If you employ them and pay them to do this …
Alberto Amatong, Jr.: Employees, usually if they are paid to do that, if that is part of their duty where [crosstalk 00:06:13]-
Jay Curry: So put it in the job description.
Alberto Amatong, Jr.: They usually do not need to have it in their employment agreement, but it’s a good idea to do that anyway.
Matt Register: I tell you what, I’ve probably met a hundred of these guys, right? Guys that have worked for a major company as an engineer. They’ve come up with an idea, right, and left-
Alberto Amatong, Jr.: I’m an engineer, by the way.
Matt Register: Yeah, I mean I am too. I love engineers, but here’s where it gets a little dicey, though. They are employed by a major company, they leave the major company and they start a company with whatever invention they have. Who owns that idea? I mean, at what point is this engineer running into trouble if they used company time, company software, company resources to invent an idea that is now going to compete against the big company? Big companies don’t necessarily appreciate that, right?
Alberto Amatong, Jr.: That’s correct. Usually those situations will warrant litigation. And from my experience, one of the most important things or evidence that people look for there is documentation. A lot of times engineers will come up with an invention, but there’s no physical evidence of it. It’s in their head, because an invention, a patentable concept is a concept. It’s actually not anything physical, it’s an idea. The conception of that idea that triggers the date of that invention. Sometimes it’s not, well, it’s usually not easy to trace the birth of that idea, the birth of that invention, and the date or the date of conception usually determines who owns it, because if that inventor is employed as an engineer for the previous company when they conceived the idea, then that company-
Matt Register: It’s possible the company owns it, right?
Alberto Amatong, Jr.: Right. But oftentimes we don’t have documentation, which-
Matt Register: Sure. It’s interesting, and it’s something that comes up a lot, especially in Houston. Like I said, I know probably a hundred of these guys. The last thing I want to talk about is, companies that are expanding by acquisition. They’re getting ready to buy a company that has some kind of intellectual property associated with it. You guys have every ability to come in and help them figure out the landscape of what it is they’re buying, correct?
Alberto Amatong, Jr.: All the time, yes. Especially when they’re buying a company where technology is central to the value of that company and what they do.
Jay Curry: So they need to get somebody like you involved right then, right?
Matt Register: Yeah well, I would think, because questions that obviously pop up is how well protected is this idea, right, and is there anything that I’m going to rub up against, right, whenever I buy it, and is there anything additional I need to do to protect it, right, once I buy it? Is that some of the things that you’re working on, huh?
Alberto Amatong, Jr.: Exactly.
Matt Register: All right. Interesting stuff.
Jay Curry: Yeah, it is.
Matt Register: Alberto Amatong, Jr. Amatong-McCoy is the law firm out of Houston, Texas. What is the easiest way for somebody to get in touch, should they want to learn more?
Alberto Amatong, Jr.: Probably the website, www.amatongmccoy.com
Matt Register: Amatongmccoy.com. We’re going to have that linked right there from texasbusinessradio.com, if you’re driving and can’t take notes. Interesting stuff, Jay. And this is something that people screw up all the time, and I promise you, when companies are trying to grow and they have a never ending need for cash, this is generally something that’s pretty low on the priority list, right?
Jay Curry: That’ right, and it could come and bite them.
Matt Register: Yeah. It shouldn’t be low on the priority list. Interesting stuff. Thank you very much, Alberto, for joining us. Very interesting.
Alberto Amatong, Jr.: Thank you, guys.
Jay Curry: Thank you.
Matt Register: Very interesting stuff. Guys, we’re trying to help you keep your business strong, keep your business growing, and this is certainly a part of it. We do, however, have to take a break and pay some of our own bills. We’re going to be back right on the other side of the break with a whole lot more Texas Business Radio. We’re just actually getting warmed up. We’ll see you on the other side of the break with a whole lot more. Don’t go anywhere, guys.
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In addition to hosting "Texas Business Radio," Matt is an investment banker and serial entrepreneur from Montgomery, Texas. He is the owner of RREA Media and Register Real Estate Advisors and a Managing Director and Principal at Corporate Finance Associates. He has a BS from the United States Military Academy at West Point and an MBA from Rice University in Houston. You can read more about Matt HERE.
Jay W. Curry
Along with hosting “Texas Business Radio”, Jay is a Professional Certified Coach and Master Chair facilitating four Houston-based Vistage peer groups. In addition to being a best selling non-fiction author, the 2015 release of his award winning novel, Nixon and Dovey: the Legend Returns, adds novelist to his title. Jay holds a BS in Mathematics from Oklahoma State and an MS in Computer Science from Kansas State. You can learn more about Jay HERE.