From the AEGIS e-Journal, Volume 10 Number 2, February 2007
IP/CI Conference CALL for PAPERS and PRESENTATIONS Conference Mission: The mission of this conference is to provide senior managers and counsel with the most current strategic and tactical knowledge base on the identification, valuation, and protection of intellectual property and critical information The objective is for the papers and presenters to be informative, as well as to give readers/attendees no option but to think and plan. ÆGIS, February 2007 4 Commercial Climate: Loss of critical information and intellectual property from competitive intelligence, economic espionage, and theft is a serious and burgeoning problem. The cost of an average incident in a manufacturing environment is $50 million. The cost of an average incident in a non-manufacturing environment is $500,000. If one incident is uncovered, a second – and often third – incident is usually discovered to be taking place concurrently. Losses of $100 million or more can have a significant effect on a company’s financials, producing a reduction in earnings of a dollar per share if the company has 100 million shares outstanding! The federal government estimates total annual cost of competitive intelligence, economic espionage, and theft to be $300 billion. This is 2.25% of America’s GDP, and translates into 7,500,000 American jobs lost annually. Because of the economic and social significance of these losses, the SEC has mandated that, under Sarbanes Oxley, companies must implement internal controls to track these losses. That pre-supposes the ability to identify, value, and protect intellectual property and critical information. There are three problems that can arise from not having a program for the identification, valuation, and protection of critical information and intellectual property, each of which can affect senior managers and directors: 1. They will have to deal with the consequences of being in non- compliance with Sarbanes-Oxley, which can involve both civil and criminal exposure. 2. If the theft ends up being prosecuted under the Economic Espionage Act of 1996, a compelling case can be made that by not having an OPSEC program as required by Sarbanes-Oxley to identify, value, and protect information from competitive intelligence, economic espionage, and theft, they failed to take the required “reasonable measures to keep such information secret.” This means that they have, through negligence or deliberate indifference, abandoned the trade secret status of the stolen information, which was therefore not a trade secret as defined under the Economic Espionage Act of 1996 and the Uniform Trade Secrets Act. 3. They face the possibility of shareholders bringing a negligent action lawsuit because the company knew (or should have known) that with annual domestic losses of $300 billion, there was a high-probability ÆGIS, February 2007 5 threat that should have been addressed. PLUS they both abandoned the trade secret status of their information under the Economic Espionage Act AND were non-compliant with Sarbanes-Oxley, which were at least partly designed to force them to protect shareholders from just this type of loss. Since ignoring Sarbanes-Oxley requirements indicates negligence or deliberate indifference, there is a probability that their liability will not be covered by their Directors and Officers Insurance because they did not exercise due care. It becomes personal liability. Topics We are looking for presenters and papers addressing strategic and tactical (but not operational) issues on: Identification • The intangible economy • Management objectives and the information that adversaries and business competitors would find helpful or critical in defeating those objectives • Identification, cataloguing, and tracking IPCI • IPCI audits • IPCI banks and funds • IPCI, public companies, SOX, and the SEC Valuation • Valuation of IPCI • The effect on the organization of lost or compromised IPCI • IPCI value impairment through failure to implement an OPSEC program • Items that relate to the topics of IPCI, valuation, the future of IPCI • Litigation / OPSEC / IPCI valuation / M&A • Recovery after a loss ÆGIS, February 2007 6 Protection • OPSEC: The government-developed process for identification, valuation, and protection of critical information • Identifying adversaries and competitors • Tracking IPCI that has left its company Implementation • Creating a system-wide OPSEC program • Location of IPCI, geographic and legal environment • Dealing with the publicity of IPCI losses • What an ideal IPCI jurisdiction would look like • Re-domiciling IPCI • IPCI and SOX reporting Please note that while we are focused on addressing the Conference Mission, we will consider all submissions. After all, you may have a great topic we have not thought of, so send it in! Submission Requirements: The paper or presentation (if completed), or an abstract of the paper or summary of your presentation. Include title, author’s profile, affiliations, and contact information (address, e-mail and phone number). Submission of a paper grants AEGIS unlimited use of the material if accepted for publication or presentation, with copyright retained by the author. Submission deadline: Postmarked by 10 April 2007. Send submissions to papers@aegisjournal.com or AEGIS journal 440 W 41st ST New York, N.Y. 10036-6816 ÆGIS, February 2007 7 CLE Credits CLE credits may be available (depending on state requirements). Conference Registration: Registration is $450.00 for participants registered before April 1, 2007 and $550.00 dollars for those registered after 1 May 2007. Presenters will receive complementary registration. Those who have had papers selected for the conference publication, but not for presentation, will receive the conference publication free of charge and may attend for a registration fee of $50.00. Those interested in attending can call us at 1-917-545-9428, e-mail us at conference@aegisjournal.com, or mail us at AEGIS journal 440 W 41st ST New York, N.Y. 10036-6816