David Cabello is a partner at Wong Cabello Lutsch Rutherford, an intellectual property law firm. Cabello has been named Texas Super Lawyer® in Intellectual Property Litigation for the last three years.
He also owns a Tesla.
Cabello talked to John Batchelor, host of the John Batchelor radio show, and Lou Ann Hammond, CEO, Driving the Nation about Elon Musk opening up Tesla Motorsports patents.
Some of Cabello’s thoughts on the Tesla open sourcing it’s patents were:
What do you think, as a patent lawyer, of Tesla open sourcing their patents?
That depends. Tesla hasnt released the details or the terms under which the patents will be made available.
Teslas patents are a company asset that was acquired through a significant investment by the company.
Tesla like any other patent owner should receive a return on that investment.
Tesla must keep it’s shareholders interests in mind as it moves forward with this program.
A royalty free license would give Teslas shareholder no return on that investment.
Moreover, a royalty free license may jeopardize the long-term viability of the Tesla supercharger stations.
Tesla has committed to building a network of super charger stations and has further committed to charging Teslas free of charge.
Tesla will therefore make a significant capital investment in the network of super charger stations and will have a long-term “energy” expense as more and more owners of Teslas stop to charge their batteries. If the owners of non-Tesla cars can charge their batteries free of charge (because the technology is open to them), Tesla will have an expense for which there is not a corresponding and offsetting revenue. The long-term expense of super-charging stations can jeopardize the long-term viability of the super-charging stations and consequently the availability of free “charges” for Tesla owners.
What are the pros and cons of open sourcing patents?
The pros are that Teslas leading technology becomes a standard in the industry. But standards need not be royalty free. A standard can develop as long as it is offered on reasonable, non-discriminatory terms. At bottom, if Tesla wants a standard to develop around it’s technology it simply needs to tell the world that it is willing to make it available. I think thats been done. What follows next, is at what cost? If the industry sees the cost as reasonable, then there is no need to develop a competing technology.
The corollary here would be a gasoline dispenser nozzle that only supplied gasoline to Ford products. The industry would be poorly served if everyone had a proprietary nozzle. Certainly theres much more to charging but the concept is the same.
Listen to Cabello, Batchelor and Hammond talk about Tesla and it’s patents: