Monday, October 25, 2010

Overnight Success Plus IP Rights

You might not know it by looking at the website, but Toronto based Engineering Services Inc. (ESI) has a Canadian space focused pedigree going back to the 1970's.

In fact, from 1975 until 1981, ESI founder Dr. Andrew Goldenberg was an employee of SPAR Aerospace Ltd. which built the first Space Shuttle Remote Manipulator System (or Canadarm). Goldenberg worked mainly on the control, analysis, and design of the Canadarm and on satellite controls according to his bio on the University of Toronto Department of Mechanical and Industrial Engineering website, where he is now a Professor and the Director of the Robotics and Automation Laboratory (RAL) and Mechatronics Laboratory (ML).

He also remains at ESI, where he serves as CEO.
Photo: NASA (19 July 2009)
Knowing this helps to provide a little context for the recent awarding of three Canadian Space Agency (CSA) contracts to the scrappy little firm. The most recent was the October 25th, 2010 CSA announcement "Canadian Space Agency awards contract for exploration technologies" which states:
The Canadian Space Agency has awarded a contract valued at $3 million (CAD) to Engineering Services Inc. (ESI) of Toronto, Ontario, to develop prototypes of a robotic arm, control stations and exploration tools. In the coming months, these technologies will be integrated into terrestrial prototypes of lunar or martian rovers. The contract also includes an option for a second arm worth $500 000. The investment is part of the Government of Canada's 2009 Economic Action Plan and aims to accelerate the research and development of new technologies for space exploration.
The company has also been awarded two other CSA contracts for the development of a micro-rover platform with tooling arm and a small manipulator arm as outlined in this December 14th, 2009 ESI press release.

It's interesting to note that the final paragraph of the ESI press release states specifically that: technologies and intellectual property retained by ESI over the course of the work will be put to new and challenging uses both in space and on the ground, strengthening ESI's position as a leader in the transfer of robotic technology to the marketplace for the benefit of Canada.
Intellectual property (IP) developed as a result of CSA contracts has traditionally not remained with CSA contractors but is instead normally assigned to the CSA Commercialization Office which provides intellectual property management and supports technology transfer.

However, this policy has generally been a failure and very few CSA advances have ever ended up being repackaged and sold commercially.

But as originally outlined by Marc Boucher in his April 28th, 2010 article "Canadian Space Agency Gives Green Light to Build Prototype Mars Rover" the intellectual property developed through this specific series of contracts will remain with the contractor and therefore could end up being be of substantial benefit to ESI as the company moves forward.

Kudo's to the CSA for making this change. Canadian companies are best positioned to commercialize any intellectual property developed from Canadian space contracts and should be allowed to do so.


From: Daniel Faber

Hi Chuck,

I hope things are well in Canada? It's good to see the blog posts again :)

Regarding your story "Overnight Success Plus IP Rights", you mention that "Intellectual property (IP) developed as a result of CSA contracts has traditionally not remained with CSA contractors". It is my understanding that this policy changes back and forth on a 5-10 year cycle.

Kieran will have more experience in this but my understanding is that sometimes they let the contractor have it (and retain a right to use it and give it to others if they don't like the work of the first company), and sometimes they keep it all in CSA.

On another note, I was in Europe recently (unfortunately I didn't get to jump over to Canada on this trip) and did the rounds of the ESA Business Incubation Centers (BIC), the ESA Investmet Forum, the IAC Entrepreneurship & Investment Committee (which I am now a member of), and the Open Sky Technology Fund ( There is some very interesting stuff happening over there. The basic message is 2-fold:
  1. If you want start-up money and don't mind moving to Europe & putting up with their bureaucracy, there is money attached to the BICs, and 
  2. If you have revenues of >$500K and want to expand there appears to be a LOT of money available. Having seen pitches from several start-ups there, they are about the same quality as in Canada so Canadians are definitely not at a disadvantage.
CSA should set up an ESA BIC! Worth disucssion, and might get ministerial support given what appears to be a recent push to support innovation by the govt now that most Canadian VC firms have disappeared.


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