Internet of Things (IoT) Strategic Patent Development Best Practice

Goldman Sachs defines IoT as the third wave of internet revolution: by connecting to the internet billions of devices, IoT opens up a host of new business opportunities and challenges. According to McKinsey, IoT has the potential to create up to $6 trillion economic value annually by 2025. According to Research and Markets, there are more than 2000 companies that are selling IoT enabled products, playing a vital role in the IoT technology development or act as an enabler to the IoT business development. Consequently, as more and more business players compete to have the leadership in the emerging IoT market, many global high tech business leaders and start-ups are now participating in the development of patents for their IoT innovations competitively.

For example, as of October 15, 2015, more than 600 patent applications are filed in the USPTO that specially mentioned the IoT in their disclosures. Therefore, to have a winning strategy for developing IoT patents in alignment with the IoT market development is timely and very important.  One essential factor in the strategic IoT patent development is to construe the patent disclosures to support future development of IoT businesses and commercial implementations of IoT innovations.

Allure Energy is a smart home energy management company based in Austin, Texas. Allure Energy develops leading-edge smart energy management solutions for many IoT applications. Allure Energy has developed 22 US family patents for the smart energy management up to now starting from two U.S. Provisional Patent Applications, Ser. No. 61/255,678 entitled a “Proximity Based Home Energy Management System and Method”, filed on Oct. 28, 2009 and 61/235,798 entitled an “Alternative Energy Asset Management System with Intelligent Data Framework Capabilities, filed on Aug. 21, 2009. Allure Energy exploited strategic patent drafting and prosecution (continuation practices).

Allure Energy initially drafted the disclosures of a few co-pending patent applications very broadly in anticipation of future business development. Then, Allure Energy prosecuted family patents to capture many commercial implementations as the market evolves. Allure Energy is still developing more family patents to capture most recent commercial implementations (e.g., IoT device control using Bluetooth connection, exploiting smartphone for the IoT device control, autonomous adaptable energy management system).

Significant number of forward citations shows the high quality of the family patents. Especially, many patents of most key industry players including Google (Nest Lab), GE and Honeywell in the smart energy management heavily cited Allure Energy patents. For example, more than 30 GE patents cited the Allure Energy patent US8024073. Five patents (US8442695, US8457797, US8509954, US8571518 and US8626344) exploited to sue Google and Honeywell for patent infringement. A huge number of claims of the family patents make it very difficult to invalidate the family patents through PTAB IPR process.