Download IP Valuation Charter_3 April 2017

LES Standards Committee Charter Document
Intellectual Property (IP) Valuation Standards Committee
3 April 2017
Scope
The core function of the Intellectual Property (IP) Valuation Committee is to create industry-wide standards for
businesses engaged in the practice of valuing IP, including patents, trade secrets, and copyrights, or using IP valuations
in commerce. These standards will serve to:
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Establish a standard framework for conducting IP valuation engagements.
Improve the practice of IP valuation.
Establish a consistent framework and method of evaluation and reporting that produces IP valuation reports
that courts, government entities, and other third parties can utilize to admit or accept in an objective form.
Increase the public acceptance and credibility of IP valuation reports.
By identifying durable and flexible IP valuation methods, the standards will preserve and enhance the function IP
valuations serve while maintaining objectivity and compliance with current and future rules, regulations and laws.
Specifically, the business practice standards will include requirements for ethical conduct in IP valuation development
and reporting and industry-accepted business practices.
These standards apply specifically to businesses that regularly engage in producing, reviewing, or consuming IP valuation
reports. The focus of the standards will be on due diligence, valuation modeling, and valuation reporting behaviors and
practices applied uniformly across the industry.
Type of Standard
The committee envisions the primary standards document to follow a formal accreditation process compliant with ANSI
guidelines. One of the first tasks of the committee is to define phrases like “certification” and “accreditation”; for
example, an entity may become certified through the adoption of the standards into corporate policy but may need to
go through a full audit before it can become accredited. Accreditation will follow a binary model on a pass/fail basis as
assessed by a third party, possibly such as LES or ANSI.
Work Products:
1) The primary work product will be a document outlining the specific steps and guidelines an IP valuation must
follow in order to achieve certification or accreditation (see Type of Standard above). Categories of behavioral or
business practice standards may include:
 Due Diligence steps
 Valuation modeling methods
© LES USA & Canada
Patent Valuation Standards
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LES Standards Committee Charter Document
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Valuation reporting requirements
2) While the primary goal is to address the consistent development and production of IP valuation reports, the
committee also envisions the creation of a discrete set of uniform document templates to supplement the
standards and provide models for organizations conducting IP valuations. These templates may include the
following documents.
 Due diligence checklists
 Valuation model templates
 Valuation report templates
 Exemplary case studies
Appendix A below contains a full draft list of potential standard agreement templates. These agreements will
be assigned to Committees or a newly collected working Subcommittee.
3) The committee also envisions a suite of documents describing the standards and the certification or
accreditation process, with instructions for all relevant parties involved in the process.
Timeline
Steps
Charter draft completed
Committee recruitment finalized
First draft of the standard
published to the committee for
review
Initial comments from the
committee submitted to
committee or subcommittee
leadership for review
Second draft of the standard
published to the committee for
review
Final comments from the
committee submitted to the
committee or subcommittee
leadership for review
Committee voting on the draft
standard
Submission date to the LES USA &
Canada board for review
Approval by the LES USA & Canada
board to submit the draft standard
to the general membership for
comments
© LES USA & Canada
Date
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Patent Valuation Standards
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LES Standards Committee Charter Document
Publication of the draft standard
to the general membership for
comment
Submission of comments to the
draft standard by the general
membership complete
Review of general membership
comments by the committee
Publication of general membership
comments and the publication of
the committee’s response
Submission of the final draft
standard to the LES USA & Canada
board for review and approval to
publish the draft standard for
general membership voting
Publication of the draft standard
for general membership voting
Voting complete
Publication of the new LES
standard
Structure of the Committee
The committee will have a chair, vice-chair, and secretary, which will be voted on and approved by the larger
committee, as well as advisors from both LES and ANSI. The committee envisions having member participation
throughout the process as well as in potential subcommittees, which will be formed and recruited by committee
leadership.
Current Committee Leadership
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Mike Pellegrino, Committee Chair
o President, Pellegrino & Associates, LLC, (317)566-8199, [email protected]
Alex Rehmeier, Committee Vice Chair
o Director, IP Integration, Boeing, (714)896-4849, [email protected]
Chuck Cruit, Committee Secretary
o IP Management Consultant, Boeing. (484)709-5363, [email protected]
Committee Recruitment
The committee believes it is critical to recruit a wide and diverse body of IP valuation producers, reviewers, and
consumers, LES members and otherwise, to participate in the formation of the standards. Recruitment will be led by
Mike Pellegrino, Gauri Prakash-Canjels, and Stan Stephenson.
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Patent Valuation Standards
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LES Standards Committee Charter Document
Membership
The Committee Leadership will participate in the active recruitment of a diverse array of members to assist in the
development of the standards. The initial membership should reflect the broad IP valuation community and a variety of
key stakeholders. Members may have experience as licensing executives or attorneys, either in an in-house or external
capacity. Members may include consumers of IP valuation reports (e.g., for financial reporting purposes, M&A purposes,
or litigation purposes). Members may include service providers that prepare valuation reports. Members may include
readers of valuation reports who may work at banks or regulatory agencies. Members must be willing to sign up to the
LES Standards By-Laws and IP Agreement, as well as an annual membership fee.
Further, The IP Valuation Standards Committee envisions active collaboration and communication across all other active
LES committees, potentially in the form of a joint subcommittee (as warranted) formed from members of more than one
Committee to jointly develop practices and documents that may be useful to more than a single Committee.
See Appendix A for current committee membership.
Recommend deleting APPENDIX B – STANDARD AGREEMENT TEMPLATES – DRAFT AS OF MARCH 9, 2015
Below is a full draft list of potential standard engagement checklists. Each document is assigned a tentative priority.
Next to each document is an indication of the Committee that is likely to lead the primary documentation effort:
Agreement Template
Version
Engagements
Engagement Contract
Certified engagement
All Types
1
Joint Subcommittee
Engagement Contract
Non-certified engagement
All Types
1
Joint Subcommittee
General IP Due Diligence
Checklist
All Types
1
Joint Subcommittee
Patent Due Diligence Checklist
All Types
1
Joint Subcommittee
Market Analysis Checklist
All Types
1
Joint Subcommittee
Valuation Model Checklist
All Types
1
Joint Subcommittee
Valuation Report Checklist
All Types
1
Joint Subcommittee
Valuation Report Template
All Types
1
Joint Subcommittee
Valuation Model Template
All Types
1
Joint Subcommittee
© LES USA & Canada
Patent Valuation Standards
Priority
Committee
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