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Nano World: Lawyers key to nano-revolution

By CHARLES Q. CHOI   |   Oct. 8, 2004 at 12:40 PM   |   Comments

NEW YORK, Oct. 8 (UPI) -- Nanotechnologists may be pioneering science and engineering at the infinitesimal scale of billionths of a meter, but it remains beyond doubt that no one understands the finest print better than lawyers, experts told United Press International.

New law groups specializing in nanotechnology are readying to help clients make the most of this groundbreaking field.

"In a lot of ways, lawyers are going to be nearly as important -- have as much of an impact -- as the technologists when it comes nanotechnology," said John Miller, a managing editor at the journal Nanotechnology Law & Business and vice president of intellectual property for Arrowhead Research Corp., a nanotech company in Pasadena, Calif.

"Nanotechnology is particularly attractive to law firms because it potentially has such wide commercial application and encompasses virtually every area of business law practice. There is significant money to be made," explained Valerie Fontaine, a founding partner of Seltzer Fontaine Beckwith, a legal search consultant firm in Los Angeles.

Nanotech funding is rising, with governments, corporations and venture capitalists spending more than $8.6 billion worldwide on nanotechnology research and development in 2004, according to Lux Capital in New York.

Two kinds of law groups are playing in the nanotechnology field at the moment, Fontaine said. The first includes general-practice firms that have put together nanotech groups drawing from their expertise elsewhere, such as intellectual property, mergers, acquisitions, financing, regulations, lobbying and treaty law. The second comprises intellectual-property boutique firms.

The greatest benefit a law group can provide for a nanotechnology firm right now, Miller said, is protection of a company's technology in the arena of intellectual property, or IP.

"It's crucial to establish as broad and effective a patent protection as possible," Miller told UPI. In addition, "intellectual property helps get investors excited -- it becomes a tool to raise capital. Investors see it as a key to competitiveness and have more willingness to throw money at companies with more solidified IP portfolios."

Having a good law group helps keep an IP portfolio in order by filing patent paperwork by deadlines, filing internationally, "and all the basic, boring stuff law firms do," he continued. "There's much IP you need to make sure is organized, and a good patent lawyer will help you understand what others can do to design around your claims and design your claim accordingly."

The advantage of using general-practice firms is they are better able to service all of a client's nanotech-related needs, while the IP boutique is limited to intellectual property issues, so the client would need to retain another law firm to handle all other legal issues, Fontaine said.

"These are the same pressures that have caused many IP boutiques to close and those attorneys to join general-practice firms over the past five to 10 years, without regard to the pressures of a nanotech practice particularly," she told UPI.

Law groups also will have to deal increasingly with nanotech-related litigation.

"With so many patents with overlapping claims, once materials get to market in the next few years, lots of people will have potential claims of infringement," Miller said. "Probably the most acute area there is with carbon nanotubes."

Last week's UPI Nano World noted that patent wars are likely to erupt in the next two to four years as nanoproducts finally make it to market -- a development that could stymie the technology's development for years.

Fontaine said she expects law groups eventually to begin representing people allegedly injured by exposure to nanotech substances.

"If there is public concern about environmental effects, you're likely to have litigation, warranted or not," Miller said. "Some plaintiff lawyers are likely to sue for some toxic tort."

Miller added he thinks a law group with an office in Washington, D.C., would enjoy a definite advantage in nanotechnology.

"The key there is to have a relationship with the (U.S. Patent and Trademark Office), to be able to have some kind of informal relationship with patent examiners -- to, say, meet over lunch and discuss a specific patent," he explained.

A law group with expertise in nanotechnology is key.

"A difficult situation in this field is there aren't a lot of people with particular expertise in it," Miller said. "So a problem is if you find a firm with expertise in the area you're working in, they often represent a potential competitor already, so they're conflicted out of representing you."

Among the top, general-practice firms in nanotech, Fontaine said, are -- in alphabetical order -- Bracewell & Patterson, Foley & Lardner, Gray Cary, Howrey & Simon, Morrison & Foerster, Oppenheimer Wolff, Pillsbury Winthrop, Squire Sanders, Vinson & Elkins and Winstead Sechrest.

"We use Foley & Lardner," Miller said. "They have a strong D.C. presence, have amazing expertise across the board, with people with strong technical backgrounds in different areas, and have a general practice on top of it overall. Winstead Sechrest has one partner, Kelly Kordzik, who has spent a lot of time understanding the business of nanotech, going to a lot of conferences, and is really involved with the business community. He's also head of the Texas Nanotechnology Initiative."

The top IP boutiques Fontaine cited include -- alphabetically -- Burns Doane, Finnegan Henderson, Schmeiser Olsen and Sterne Kessler.

"What's unique about Burns Doane is they started a program to educate the patent office on nanoscience," Miller said. "You have nanotechnology, which is interdisciplinary, and the (patent office) is organized by center -- semiconductors, chemistry and so forth -- and you have similar patents for a nanomaterial sent to different centers, since the patent office does not have a nanotech division. And their program has been really successful in raising awareness of basic technical issues in the patent office, and they've a great team of really good technical people. Another great firm is Finnegan Henderson, probably one of the better patent firms in the country. Sterne Kessler represents Nanosys."

Fontaine also noted that the law firm of Bergeson & Campbell represents nanotech clients in the areas of regulatory issues and product approval.

"The regulatory arena could be huge for nanotechnology law groups," Miller noted. "You have the (Environmental Protection Agency) and the Toxic Substances Control Act and (the Occupational Safety and Health Administration) -- as the toxicity of nanomaterials is really uncertain right now. You have the (Food and Drug Administration), for instance, with diagnostic devices. And you have-export control laws."

He said a lot of the technology will be used for defense and military purposes, requiring review of the export control laws, which "now are not expertly crafted to take nanomaterials into account."

There also are regulations based on substances but not on size, Miller said, citing carbon and carbon nanotubes.

"It will be helpful if both the policymakers and private practitioners are forward-thinking about where the technology is going to go, in being proactive about structuring policies and regulations to cultivate nanotech," he said. "Now is the time, when things are still in the R&D phase, to try and help pave a smooth path for commercialization of the technology."

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Nano World is a weekly series by UPI examining the explosive field of nanotechnology. E-mail sciencemail@upi.com

Topics: John Miller
© 2004 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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