Intellectual Property Activities
Canon's Intellectual Property Approach
Since its establishment, Canon has actively engaged in technology research and development, achieving success as an R&D-oriented company in creating markets and customer segments by developing products with proprietary technologies.
This history underpins the Company's belief that the achievements of R&D activities are products and intellectual property. At Canon, the purpose of intellectual property activities is to support business development. As such, we promote entry into new business areas, business diversification, and global expansion of production and marketing operations, with a focus on effective utilization of intellectual property rights.
Basic Policies on Intellectual Property Activities
- Intellectual property activities are vital to supporting business development.
- The results of R&D activities are products and intellectual property.
- In addition to protecting its own intellectual property rights, Canon respects the intellectual property rights of other companies and handles related issues appropriately.
Respecting Intellectual Property Rights
Canon is thorough in responding to product copying and intellectual property infringement. Canon has devised and implemented thorough safeguards and policies to guard against such threats.
At the same time, clear rules have been established to ensure that the intellectual property rights of other companies are respected and that our products do not infringe on rights held by others. More specifically, thorough investigations of third-party patents are conducted to prevent use of intellectual property held by others without first obtaining the relevant rights. Such thorough investigations of third-party rights are carried out at all stages, from R&D onward, based on cooperation between the R&D division involved in the technology and the department responsible for intellectual property rights.
By thoroughly instilling these rules throughout the Company, Canon smoothly and appropriately enters into partnerships with other companies and outside research institutions for cross-licensing or joint research projects. This makes it possible for Canon to achieve greater results than it could attain only by using its own patents.
A Corporate Culture that Supports Intellectual Property Activities
Canon encourages employees involved in R&D operations to draft patents (invention proposals) rather than create reports and to read patent bulletins rather than research literature as they carry out their day-to-day R&D activities.
To draft an invention proposal, a researcher needs to compare his or her own R&D activities with prior art technologies, understanding them objectively and summarizing them systematically. This leads to the acquisition of higher-value patents as intellectual property rights. Patent bulletins provide technological information that informs researchers about technical issues and solutions in relevant fields, knowledge of prior art technologies, competitors' activities and other trends. Intellectual property rights information bulletins are useful for alerting researchers when rights holders need to be taken into consideration during business development.
At Canon, researchers and engineers involved in R&D are keenly aware of the significance of intellectual property activities, which fosters a corporate culture of consistently setting high development objectives.
Intellectual Property Management System
To carry out its business activities consistent with its intellectual property strategy, Canon Inc. has centralized intellectual property rights management under the direction of the Corporate Intellectual Property and Legal Headquarters.
Specifically, the intellectual property rights of R&D divisions, other products operations and Canon Group companies are centrally managed to optimize the overall intellectual property portfolio.
For example, when concluding a patent licensing agreement with another company (a third party), the Corporate Intellectual Property and Legal Headquarters approves the agreement only after making adjustments reflecting merits for the entire Group. This step ensures that the Group maintains an appropriate intellectual property portfolio. We review our portfolio regularly to ensure that only necessary rights are being reserved.

Intellectual Property Management Structure
Group Company Management Structure
The respective roles and responsibilities of Canon Inc.'s Corporate Intellectual Property and Legal Headquarters and the intellectual property divisions at each Group company, along with the formulation process for policies on activities and other issues between them are determined by Canon's management rules.
An Intellectual Property Summit is periodically held to facilitate information sharing throughout Group companies in Japan and overseas. This summit serves as a forum to communicate information and perspectives on trends in society as well as intellectual property initiatives being undertaken by Group companies in Japan and overseas. It also ensures that prompt action can be taken when an intellectual property issue arises.
Moreover, people in charge at the Corporate Intellectual Property and Legal Headquarters have been posted or sent to visit Canon Group companies to bolster global intellectual property activities and develop human resources.
Promoting More Innovative Inventions Leading to Patent Rights
As the cycle from product development to marketing becomes shorter, it is more difficult for researchers to closely study technologies that lead to inventions and to accurately stay abreast of a broad range of related technological trends.
One approach we have taken in this regard is to appoint Patent Portfolio Managers (PPMs) within each product operation. A PPM is a veteran technician with rich knowledge and experience concerning technological and patent application trends. PPMs select useful inventions and link the types of patents that tend to be overlooked amid the Company's busy development operations to effective patent applications.
Through this organized approach, Canon aims to expand and reinforce its intellectual property.
Prior Art Searches to Improve the Quality of Patent Applications
Even if R&D culminates in a patent application, a patent cannot be granted if a third party has submitted an application for a similar invention. Accordingly, we conduct prior art searches for previous publications to ensure that we assess the validity of applications and that we pursue originality in development.
When filing patent applications, each inventor uses Canon's search system, P/Net SR to investigate the existence of similar prior art. In 2006, we incorporated an English-Japanese translation function into the system to allow efficient searches of U.S. patents as well. In addition, Canon Technology Information Services Inc.—a Group company specializing in technology search services—performs more detailed prior art searches.
The thoroughness of such screenings raises the quality of patent applications, while utilization of the Japan Patent Office's Super-Accelerated Examination System*1 and Patent Prosecution Highway*2 speeds up the patent process.
- *1Super-Accelerated Examination System
This system is offered by the Japan Patent Office to provide an even faster route than the existing accelerated examination process. A pilot program was introduced in October 2008.
- *2Patent Prosecution Highway
This is an arrangement between the Japan Patent Office and various other countries and regions. It enables an application that has been determined to be patentable in the Office of First Filing (OFF) to undergo an accelerated examination in the Office of Second Filing (OSF) with a simple procedure following a request from an applicant.
Canon Prevails in Laser Printer Toner Cartridge Patent Infringement Suit
In June 2010, Canon filed patent infringement suits against 20 companies, including Ninestar Image Int'l Ltd. and Zhuhai Seine Technology Co., Ltd., before the United States International Trade Commission and U.S. District Court for the Southern District of New York. In these suits Canon claimed infringement of the patents held by the company in regard to certain toner cartridges and photosensitive drums sold by the respondents for use in Canon or Hewlett Packard laser printers.
As a result, in May 2011, the United States International Trade Commission and U.S. District Court for the Southern District of New York determined the patents at issue to be valid. Therefore, the respondents are prohibited from selling and offering for sale in the U.S., and from importing into the U.S., the toner cartridges and their photosensitive drums subject to the infringement lawsuit.
Brand Management
Brand Management Approach
The Canon brand is the symbol of Canon's commitment to its customers. Under this brand, the Canon Group is responsible for fulfilling the following mission:
- As a manufacturer, to deliver high-quality, convenient products that provide customer satisfaction and are a pleasure to use
- As a marketing company, to provide optimal solutions and services that meet customer needs
- As a corporation, to gain the confidence and trust of society
Proper brand management is vital to ensuring that customers and society are not adversely affected by unauthorized use of trademarks within the Group and improper use of Canon's corporate logos by third parties.
Ever aware of this responsibility, Canon has formulated Brand Management Rules and established the Brand Management Committee to deliberate and resolve brand-related issues.
Established as a secretariat of the Committee comprised of the persons responsible for brand-related issues from the
Public Affairs Headquarters, the Legal Administration Center, the Design Center, Environment & Quality Headquarters, and Corporate Intellectual Property and Legal Headquarters, the Brand Management Division is structured to act quickly in response to brand-related problems.
Brand Management Rules
Canon has formulated a set of Brand Management Rules, including the Canon Mark Basic Rules in 2003, to ensure that employees use the Canon brand in compliance with regulations and raise the value of the Canon brand through the trust of customers and society. These rules govern the use of trade names, brand names, the Canon logo, and other corporate insignia.
We plan to revise these various rules in 2012 so as to execute appropriate management in light of the changing business environment and opinions concerning our brand from both within and outside the company.
Promoting Awareness of the Canon Brand
While implementing rules and management systems, Canon carries out brand education programs across all Group companies in the regions where it operates to ensure that all employees fully understand the Canon brand and act with propriety and in accordance with pertinent rules. Such education raises the awareness that "Each and every employee embodies the Canon brand."
For example, Canon Inc. is incorporating brand education programs into the training curriculum for new recruits and newly appointed general managers.
In addition, we are using our corporate Intranet to disseminate information that helps to raise awareness of the Canon brand among employees at Group companies, including direction on how to use the Canon logo properly.
We held briefings in 2010 for Canon Inc.'s products operations and Group companies concerning the Product Environment & Quality Guidelines Regarding Use of Trademark Canon. These Guidelines stipulate the continuous implementation of quality assurance and product environmental assurance to strengthen the foundations of the brand.
An increasing number of companies have been joining the Group in recent years through M&A, making it important for everyone within the Group to share the same culture and goal awareness. In light of this situation, we will focus on internal branding so as to increase Group vitality through a shared recognition of the Canon brand.
Measures to Tackle Counterfeits
Canon's stance on counterfeit products has always been strict. Such products cannot be overlooked as they not only damage the brand, but may also lead to economic losses arising from malfunctions and inferior quality and, in the worst case, cause injury to or endanger the lives of customers purchasing Canon products in good faith.
Accordingly, we are actively involved in anti-counterfeit efforts based on our trademark rights. We are engaged at several levels in exposing factories that manufacture counterfeits and retail locations that sell them, while pressing national customs bureaus to stop their importation.
Moreover, in recent years the number of counterfeit items entering the market through electronic transactions via Internet-based retailing in which the authenticity of products is often not confirmed has increased. We are working to counter such activity by monitoring the sale and distribution of counterfeits through the Internet and exposing the counterfeiters.
In Japan also we are taking strict measures, including litigation, as part of our drive to halt trade in counterfeit goods.
The sale and distribution of counterfeit goods is likely to become increasingly borderless. Accordingly, Canon will continue its crackdown activities in current markets, while also bolstering customs enforcement measures in regions known to be global logistics hubs, and monitoring and deterring counterfeit goods transactions on the Internet.
Patent Application Status
Canon has promoted the globalization of its business operations from its early days, putting great emphasis on filing patent applications outside Japan. As a result, as of the end of 2011, Canon possessed approximately 86,000 patents and utility models worldwide.
When filing patent applications outside Japan, our teams develop detailed patent-filing strategies based on regional business strategies, technologies and product trends to assess the countries/regions where patents are necessary.
Filing of patent applications in the United States in particular has been emphasized with the dual goals of expanding operations and advancing technology partnerships, as the United States has many high-tech companies and a large consumer market. High priority is also given to filing patent applications in Asia, where technological innovation is advancing rapidly. In particular, we have stepped up filing activities in China due to its development as a dominant production base and a major consumer nation.
| Rank | Holder | No. |
|---|---|---|
| 1 | IBM Corporation (USA) | 6,163 |
| 2 | Samsung Electronics Co., Ltd. (Korea) | 4,899 |
| 3 | Canon Inc. (Japan) | 2,813 |
| 4 | Panasonic Corporation (Japan) | 2,566 |
| 5 | Toshiba Corporation (Japan) | 2,478 |
| 6 | Microsoft Corporation (USA) | 2,306 |
| 7 | Sony Corporation (Japan) | 2,282 |
| 8 | Epson (Japan) | 1,535 |
| 9 | Hon Hai Precision Industry (China) | 1,485 |
| 10 | Hitachi (Japan) | 1,464 |
| Rank | Holder | No. |
|---|---|---|
| 1 | IBM Corporation (USA) | 5,866 |
| 2 | Samsung Electronics Co., Ltd. (Korea) | 4,518 |
| 3 | Microsoft Corporation (USA) | 3,086 |
| 4 | Canon Inc. (Japan) | 2,551 |
| 5 | Panasonic Corporation (Japan) | 2,456 |
| 6 | Toshiba Corporation (Japan) | 2,212 |
| 7 | Sony Corporation (Japan) | 2,130 |
| 8 | INTEL Corporation (USA) | 1,652 |
| 9 | Hewlett-Packard Company (USA) | 1,489 |
| 10 | LG Electronics Inc. (Korea) | 1,488 |
| Rank | Holder | No. |
|---|---|---|
| 1 | IBM Corporation (USA) | 4,887 |
| 2 | Samsung Electronics Co., Ltd. (Korea) | 3,592 |
| 3 | Microsoft Corporation (USA) | 2,901 |
| 4 | Canon Inc. (Japan) | 2,200 |
| 5 | Panasonic Corporation (Japan) | 1,806 |
| 6 | Toshiba Corporation (Japan) | 1,669 |
| 7 | Sony Corporation (Japan) | 1,656 |
| 8 | INTEL Corporation (USA) | 1,534 |
| 9 | Seiko Epson (Japan) | 1,328 |
| 10 | Hewlett-Packard Company (USA) | 1,269 |
- *1Canon survey based on United States Patent and Trademark Office data as of December 31, 2011.
- *2IBM is an acronym for International Business Machines Corporation.

Trend in Canon's Unexamined Patent Applications in China



