In the thick of it
Laura Quatela has held a succession of market-defining positions in the IP field. As she embarks on perhaps her most exciting role yet, she outlines how she got where she is today and where she is going next
Laura Quatela makes a habit of being where the action is. Having presided over Eastman Kodak during its bankruptcy and patent sale, assisted Technicolor through its dispute with an activist shareholder and played a central role in Alcatel-Lucent’s acquisition by Nokia, she has now taken a leadership position with Chinese corporate leviathan Lenovo. “I really enjoy the operating company environment and particularly being part of a technology company with complex IP assets and strategy,” enthuses Quatela of her latest post as chief legal officer (CLO).
Lenovo is one of China’s phenomenal success stories. Established as Legend Holdings in 1984 at a guardhouse in China, by 1996 it had become the country’s largest PC provider. Following a rebrand to Lenovo in 2004, it acquired IBM’s PC division the following year and by 2013 was officially the world’s largest PC company. However, despite its meteoric growth, Lenovo was lacking in real IP leadership until 2012, when Ira Blumberg was hired to develop its patent strategy.
Since Blumberg’s hire, Lenovo has been investing heavily in building its IP portfolio and positioning itself as a key player in both innovation and acquisition. In 2014 alone, the company purchased a portfolio of 21 patent families from former public IP company Unwired Planet for $100 million, bought 3,800 mobile patent families from Japanese tech giant NEC and acquired a portion of the Motorola Mobility portfolio from Google for $2.9 billion- a deal which made Lenovo the world’s third-largest smartphone provider.
“My aim is to guide a truly global and diverse staff to deliver their best professional selves to the businesses and clients we serve in this complex, fascinating and fast-paced environment,” states Quatela of her role at the company. As CLO, she reports directly to the CEO and in turn has a senior legal leadership team – which includes Blumberg – reporting to her. “Ira has a strong track record of IP leadership for the company. Where it would benefit him to tap my IP consulting and other experiences, I will provide it free of charge,” she laughs, when asked about her immediate plans for the management of Lenovo’s IP portfolio and how much of her time she expects to devote to it.
Quatela’s move to Lenovo has been in the pipeline for a while, but until recently the timing was not quite right. “This is chapter two of my story with Lenovo,” she reveals. “We were first in discussions five or six years ago, when I was at Kodak. The company’s financial situation was becoming constrained and there had been some shifts in the management structure, so I didn’t feel I could leave Kodak at that point. I’d kept in touch with Lenovo and they called in the summer to ask if I would consider the position of CLO, as the incumbent was retiring.”
Quatela will remain based in Rochester, New York, while also having an office in Lenovo’s US headquarters in North Carolina. However, had the position been based in China, she would have found it a smooth transition. A Mandarin speaker, she spent a year in China during her bachelor’s degree in international politics and later attended the East China Institute of Politics and Law in Shanghai while studying for her juris doctor.
However, despite her background and linguistic skills, working for a Chinese company was not something that Quatela anticipated until relatively recently. “All of my focus on China was pretty early, starting in the late 1970s, before it became trendy,” she muses. “But I feel as though it prepared me to work for a Chinese company and I am glad to have been given the opportunity to do so.”
Given her track record in IP monetisation, it might perhaps have been more predictable that Quatela would take on the role of chief IP officer (CIPO) at a tech company, rather than the far broader position of CLO. “Chief operating officer, company and business unit president, general counsel (GC), CIPO – they are roles I have served before. But whatever the title, to borrow from Lin-Manuel Miranda, I look to be ‘in the room where it happens’,” asserts Quatela. “As a member of the executive committee, Lenovo’s CLO has the chance to influence key decision making. I have found this to be very rewarding work in other situations and I’m sure this will be the case at Lenovo.”
Steep learning curve
As for so many leaders in the IP field, a career in intellectual property was never part of Quatela’s master plan, but rather a happy accident. “In law school I had started an MBA but never finished it, and that has always been a career regret,” she explains. While pursuing her legal career with Kodak, she expressed an interest in finance training and was lucky enough to be taken under the wing of the company’s accommodating chief financial officer: “He was in the later stage of his career and very eager to teach. But when I returned to the legal department after this wonderful mini-business-school training, there were no open business lawyer positions – the type of role I had held previously. The GC did offer an IP opportunity because he thought I might like licensing. I told him: ‘I’m an English major, I haven’t been to the research labs and I wouldn’t know a patent if I fell over it!’ He proposed that I try it for a year and sweetened the pot by hinting that a management position would open in the area in a year’s time (and he thought I was ready for it).”
Lenovo factory in Wuhan
While Kodak invented the digital camera, it was slow off the mark when it came to commercialising the technology, lagging behind competitors which had already started to leverage their intellectual property. In order to catch up and kick start Kodak’s licensing business, it was decided that the best course of action would be to seek royalties from players which had copied its technology. “Kodak’s licensing operation was originally housed in the legal department, with no real business profit and loss accountability or sales and marketing experience – we were a small band of lawyers and technologists unleashed on the world to extract money from infringers,” recalls Quatela. “We realised pretty quickly that we needed to take a more holistic approach to our operation: to bring everything from strategy and communications capabilities to bear to properly position what we were doing, right through to the financial aspects.” The team spent a great deal of time and effort reshaping what they were doing and making strategic hires to ensure that the group was as well balanced and productive as possible.
Quatela went on to lead the licensing team to great success, making a lasting impression on her colleagues and rising through the ranks to become company president. It was this position that she held during the company’s dark days of bankruptcy and the subsequent sale of its portfolio of digital imaging patents. “There is not much about bankruptcy to look back on proudly – it’s a really tough process,” says Quatela. “I was not involved with the bankruptcy auction of the patent portfolio, as by that point I was president of the company and was running the consumer businesses. I do feel, however, that there are so many pressures in a bankrupt environment that decisions tend to be made for the benefit of the creditors, rather than for other stakeholders.”
This was 2012 – a period of post-Nortel excitement and sky-high expectations for patent sales; consequently, multibillion-dollar estimations were made about the value of Kodak’s intellectual property. However, the final figure fell well short of this: the portfolio was snapped up for a relatively meagre $525 million by a united Intellectual Ventures and defensive aggregator RPX, funded in part by 12 licensees, including Apple, Google, Fujifilm and Samsung. Rather than start a bidding war, these companies colluded to buy the patents at the lowest price which Kodak could accept in order to secure financing that would take it out of bankruptcy. That this bargain-basement figure was ever revealed to potential buyers was deemed by some members of the IP community to be a fatal mismanagement of a transaction which was potentially worth far more. “There was a traditional investment banking approach taken to selling the patent portfolio, which is not the way we would have gone about it had our CIPO and I been managing that decision in the bankruptcy,” says Quatela. “I am convinced that if it had been handled more as an IP project, we would have conducted the transaction very differently and would ultimately have achieved a different outcome.”
Lenovo: facts and figures
- A $46 billion global Fortune 500 company
- More than 55,000 employees
- Customers in more than 160 countries
- Became the world’s number 1 PC company and number 3 smartphone company in 2013
- Sold more than 100 million ThinkPad laptops
- First Chinese member of the License On Transfer Network
The 15 years which Quatela spent at Kodak taught her a great deal about the management not only of intellectual property, but also of people, and stood her in good stead for the next phase of her career. “I learned a lot of lessons while at Kodak, but I think that – in the context of leadership – one of the most valuable was in building teams and the importance of diversity of thought and experience within those teams,” she affirms. “For a long time before leaving Kodak, we realised that we had built a highly regarded team and that we had an almost unparalleled success story: we had generated $4 billion in patent licensing and sale revenues in six years.” As such, when the time came to walk away, Quatela and her colleague Timothy Lynch established Quatela Lynch Intellectual Property with the intention of replicating that success for other operating companies.
Established in early 2014, the company helps clients to leverage their intellectual property and make strategic investment decisions. “Very early on in our tenure, we were asked to parachute in to Alcatel-Lucent to restructure the team and portfolio, with a direct focus on monetisation,” Quatela explains. However, as she and her colleagues set about their task, it became evident that their remit would alter radically as the company decided to sell to Nokia. “I don’t believe the acquisition by Nokia was on the radar when we were retained by Alcatel-Lucent – it was something that developed as we were part of the company,” explains Quatela of the coincidental timing. “We pivoted from firing up the monetisation engine to focusing on IP positioning and valuation in the context of the acquisition. So we spent several months on this. Then it became a question of how these organisations would integrate. We continued to manage the team until the Alcatel-Lucent IP team was fully integrated into Nokia.”
According to Quatela, the management of this process is a fine example of exactly what she and her colleague set out to achieve when establishing Quatela Lynch. “Although our role changed during our engagement with Alcatel-Lucent, the point was that we had a large client which we worked with on a daily basis; we had internal management responsibility; and from that platform we were able to institute real change for the company in IP strategy, set-up and approach. This is what we look to do, and what we think we are able to do better than others because of our experience and track record.”
Calming the waters
This wealth of experience has also proved of great benefit to Technicolor, for which Quatela has been a member of the board of directors and chair of the strategy committee since 2013. The French media and entertainment technology company has suffered a turbulent few years, during which responsibility for intellectual property passed through several hands before settling under the steady guidance of Arvin Patel. On top of that uncertainty, Technicolor became embroiled in a dispute with shareholder Vector Capital over the latter’s aggressive plan to split the company into two distinct product and licensing businesses.
“When I joined the Technicolor board, we had an activist investor which was very focused on the IP portfolio,” says Quatela. “Initially it stirred debate about the licensing business itself – about whether it should somehow be separated or the portfolio sold. Today, the company has positioned IP behind the operating businesses. Whereas Technicolor was once known for licensing and continues to be successful under Arvin Patel’s leadership, the company has made a series of acquisitions to grow and expand its core operating businesses. So we’re all about getting investors and analysts to focus more on these operating businesses and less on the licensing results, which we all know are less predictable.”
Vector Capital was eventually persuaded of the board’s position that a united company was the best way forward and gave its backing to Drive 2020 – a five-year plan designed to grow the business through the creation of new and valuable intellectual property while still capitalising on its successful licensing programme. “All of the directors were involved in creating Drive 2020 because it’s important to achieve consensus at that level around how the strategy of a company is deployed,” explains Quatela of her role in delivering this new plan. “Although I lead the strategy committee, this work is really driven by a talented management team with support from all of the directors’ participation insofar as their schedules allow. I’m proud that the strategy devised post-activist very much reflects the thinking of the entire board and key executive staff.”
Year of the dragon
The last few years have been a time of great change and fantastic opportunity for Quatela; but despite the move to Lenovo, her heart remains firmly with the people with whom she honed her craft while at Kodak. She is adamant that her new job is not a severance from Quatela Lynch IP and is confident that she is leaving it in safe hands. She considers the Lenovo position less a move away from her firm and more an inevitable step along the road.
“At Quatela Lynch Intellectual Property, we have a model of diving deeply into an operating company in one way or another, and my move to Lenovo is an extension of this,” she reasons. However, unlike past roles that she has undertaken as principal at Quatela Lynch IP, with Lenovo there is no endgame or exit strategy. “This is a bit different,” she concedes. “At Alcatel-Lucent, for example, although I reported to the CEO as an executive officer, I was a consultant and not actually an employee. At Lenovo, my position is more fixed and I am firmly part of the corporate structure and management team.”
The next year or so will be an exhilarating time for Quatela, as she makes her mark on the Chinese tech giant and establishes herself in yet another role set to shape the IP market of the future. “The IP community has for some time now been seeing a lot more activity in Asia as companies that have been very successful there are looking to expand into other geographic markets, and perhaps also product markets. And this is part of the reason I am so pleased to be joining Lenovo,” says Quatela. “Having the opportunity to understand this perspective deeply is a rare chance to expand my thinking about how IP trends will develop over the next few years.” And what she learns there will no doubt prepare Quatela for the next big market-making role she decides to pursue in future.
Laura Quatela – an insight
Who is your IP hero?
I have two: Gary Van Graafeiland, the general counsel who gave me a start in intellectual property despite my obvious lack of technical qualifications; and Ron Hilst, the IP manager who trained me, literally from scratch.
Outside of intellectual property, who or what has been the biggest inspiration in your life so far?
I would have to say the two most important men in my life – my father and my husband – are my greatest sources of inspiration. Both built businesses in their respective professions, dentistry and surgery, when most simply join an existing practice. They have gone about it in vastly different ways, but they are both risk takers; both leaders; both incredibly hard workers; both humanitarians.
Do you have any hobbies?
My husband and I founded a medical foundation, Help Us Give Smiles, which is a big focus for our family. Referring to it as a ‘hobby’ is diminishing, but the fact is that we both devote significant time and energy to it. My husband leads five to six missions a year to Ecuador, Guatemala, Vietnam and now Peru, many of which one or more of our kids volunteer for. I’m on the fundraising side. Among other things, we host a summer concert on the lake every year for about 400 patrons that features artists as varied as Lou Gramm of Foreigner, Chris Botti and Aaron Neville. It’s a fabulous event, but it requires an enormous amount of preparation.
Where is your favourite place to holiday?
It tends to be the last place I visited. As a family, we make one or two annual jaunts, but otherwise, we tend not to be repeat customers. There’s just too much to see and do out there in the world. By December we will have visited all seven continents, with a trip to Antarctica.
What’s your favourite season of the year and why?
Most definitely autumn. I’ve spent most of my life on the south shore of a Great Lake – Erie, Michigan and presently Ontario – where the fall season is spectacular: warm days, crisp nights, beautiful colours, mostly blue skies, even in Rochester, and lots of traditions around apple picking, corn mazes, frost on the pumpkin, that sort of thing. My favourite holiday is Thanksgiving, when we always have a full house of friends and family from around the world who we spend days cooking for.
If you could invite any five people (living or deceased, real or fictional) to a dinner party, who would they be?
I add to and subtract from this list all the time. The latest add isn’t too original, it’s Lin-Manuel Miranda – who isn’t fascinated with his genius? Longer-tenured members of the list are George Eastman (for obvious reasons), my mother (she passed away almost 20 years ago and I still have so many questions for her!), Frank Lloyd Wright (architecture was my Plan B) and either Ernest Hemingway or F Scott Fitzgerald – couldn’t have them both, because the whole affair would wind up a drunken brawl.
And what would you eat?
What we call in our family SOAR – steak on a rock. It’s an Ecuadorian technique.
As a child, what did you want to be when you grew up?
I don’t remember thinking too much about it until high school. (My father always told me I could be whatever I wanted to be, so I didn’t feel pressured to lock in on a career ambition.) But his best friend was an FBI agent who, in my sophomore year of high school, arranged for me to attend a murder trial in our town that the national press was covering. I was riveted and became convinced that criminal law was my career path.
If you could live anywhere else in the world, where would it be and why?
Quatela and family
My vision is that our kids would end up in generally the same region of the world, and my husband and I would live there. I’m sure it’s not a shared vision, though, so my fallback position would be Nantucket in the off season and Hong Kong for the balance. I can’t be happy without a body of water to stare at.
Looking back at your 18-year-old self, what advice would you give her?
Advocate less, align more.
And how do you think your 18-year-old self would respond?
She would advocate for the opposite view.
In the past few years Laura Quatela has played a significant role in the future of several high-profile operating companies. Now, rather than sit back and opt for the quiet life, she is once again throwing herself in at the deep end and taking on a new role with China’s largest tech giant, Lenovo:
- Quatela’s first foray into intellectual property was at Kodak, after she was fortunate enough to receive a mini-business-school education from the company’s chief financial officer. Along with fellow members of Kodak’s licensing team, she generated $4 billion in licensing revenues over six years.
- As president of Kodak when it faced the bankruptcy auction of its patent portfolio, Quatela had little involvement in the way in which these processes were managed. However, she is adamant that if it had been handled more as an IP project than a traditional investment banking transaction, the outcome could have been different.
- With a fellow former Kodak colleague, Quatela established Quatela Lynch Intellectual Property with the intention of replicating their licensing success at Kodak for other operating companies.
- Alcatel-Lucent was one of Quatela Lynch IP’s first clients. It was initially employed to monetise its portfolio, but the job swiftly evolved into preparing the company for acquisition by Nokia and transitioning the IP department into its new home.
- Quatela was first contacted about a role with Lenovo while still at Kodak, but it was not until this summer that the timing was right.
- In her role at Lenovo, Quatela will report to the CEO and have the senior legal leadership team – including Ira Blumberg, vice president of intellectual property – report to her.