Thursday, May 26, 2011

Inherent and But For Materiality

Inequitable conduct defenses are being retooled after a recent decision by the Court of Appeals for the Federal Circuit. See 08-1511.pdf on http://www.cafc.uscourts.gov/. Therasense and Abbott won their appeal of a district court finding of inequitable conduct, but the appellate court took this opportunity to adopt a new standard for materiality.

The Court of Appeals for the Federal Circuit has changed the materiality standard for acts of omission before the patent office to "but for" materiality, while apparently adopting "inherent materiality" standard for sufficiently "egregious" affirmative acts, such as fraudulent affidavits and schemes to defraud the patent office. However, a "sliding scale" of materiality and intent is rejected by the entire panel. How will "egregious" affirmative acts be distinguished from affirmative acts that are not egregious? To be determined, if the United States Supreme Court allows the majority opinion to stand long enough for egregiousness to be litigated.

Monday, May 23, 2011

How To Be An Entrepreneur

1. Be honest with yourself, your investors, your employees and your customers.
2. Know your business better than anyone, and know your customers best.
3. Have a product or service that your customers need.
4. Manage cash flow; seek early sales and revenue; always innovate and improve.
5. Leave customers wanting more, but don’t make them wait too long.
6. Embrace failure:
• an uncompromising teacher;
• a requisite step for innovation;
• a crucible for character.
7. Work harder than anyone; and
8. Selflessly lead your team to achieve timely business goals, notwithstanding inevitable failures.

Entrepreneurs fail, sometimes early and often. Honest entrepreneurs embrace their failures, learn from their failures, innovate and improve products and services based on their failures, and take ownership of their failures, without excuse. An entrepreneur knows the business and inspires others, within the crucible of failure, to rapidly retool and redirect efforts toward success. Life and business are uncertain. However, attracting new customers, while keeping existing customers loyal and satisfied, leads to a predictable revenue growth. The sigmoidal curve, above, illustrates a statistically predictable exponential rate of growth, early, and eventually market saturation.

The slow growth during a start-up phase and exponential revenue increase during a rapid growth phase is a predictable pattern for entrepreneurial businesses. Work hard, know your customers, have products or services that customers want, deliver goods and/or services that leave customers wanting more, constantly improve, constantly innovate, concentrate on sales and revenue, and manage your cash flow. These business basics are essential to any company. To be a successful entrepreneurial company, never settle for failure. Learn from mistakes and move on smartly.

To be entrepreneurial is to embrace failure, to learn from failure, to improve and create even more loyalty among customers, employees and investors, based on constant innovation and improvement, within the crucible of failure. Entrepreneurial success is only to be gained by 100% perseverance, followed by another 100% and another and so on.