The ability to form physical objects from digital files by using 3D printers to set down successive layers of material has businesses rethinking how they will make everything from simple plastic toys to whole buildings.

The half-day symposium in Cleveland focused on the intellectual property opportunities and threats of 3D printing, as well as its creative powers and where the smart money will be invested.

The event was moderated by Mark Avsec, vice chairman of Benesch’s Innovations, Information Technology & Intellectual Property group, and a copyright, trademark and media attorney.

Before becoming a lawyer Avsec earned a living as a studio musician, producer and songwriter, observing firsthand how file-sharing services such as Napster upended the delivery model and economics of the music industry by letting millions of users worldwide download copies of songs for free.

Nothing has put an effective stop to illegal sharing of music, even tools such as court-ordered take down notices. Sales of CDs tell the story, declining substantially in the last decade.

About four or five years ago, Avsec recounted, he realized that 3D printing could send a similar shock wave through manufacturing. Avsec cited a jarring analysis by Gartner that 3D printing will lead to intellectual property losses of at least $100 billion a year by 2018. 

At the conference, titled “What Every Business Must Know Today About 3D Printing/Additive Manufacturing,” executives from American Greetings, the chief IP lawyer for Caterpillar, the president of advanced manufacturer Thogus, the CEO of high-speed broadband network OneCommunity, and other panelists talked about riding the wave of a breakthrough technology already splashing across aerospace, automotive, logistics, biomedical, food production, museum and other industries.

Avsec kicked off the discussion with snapshots of 3D printing’s evolution to date and its tantalizing potential:

• Scientists in China used a printer 20 feet tall, 33 feet wide and 132 feet long to construct a six-story apartment building
• Twitter co-founder Christopher “Biz” Stone predicts that Nike could be a pure software company in 10 years, offering sneaker designs for download on store and home printers
• The Food and Drug Administration has cleared over 350 3D-printed medical devices to allow their marketing and sale in the U.S.

At Cleveland State University, researchers Moo-Yeal Lee and Chandrasekhar R. Kothapalli are working at the biomedical frontier of 3D printing. They’ve used the technology to engineer human tissue and examine the toxicity of drugs. Separately, Aprecia Pharmaceuticals has won regulatory approval for a 3D-printed drug to treat epilepsy. 3D printing of customized prosthetic limbs and surgical implants is expected to explode.

Yet the exciting advances come with thorny ethical and legal questions. What happens if a doctor scans a hip and prints it right in the hospital? Is the hospital the manufacturer? Will doctors themselves become manufacturers, subject to product liability laws, once they print out body parts?

And what about the IP uncertainties for any industry that creates 3D-print files of patented products? How will companies protect their property when it can be replicated by digital code shooting in a millisecond over a fiber optic cable to a competitor or foreign country?

To Caterpillar deputy chief IP counsel John Cheek the IP risks in 3D printing aren’t particularly novel. But the nature of the technology can accelerate and intensify threats, he said. Caterpillar tends to use patents rather than copyright or trademark law to protect its products. Cheek advised companies to patent 3D-printed parts and model files. New validation tools such as embedded micro-trademarks can make products harder to counterfeit.

Other legal issues, Cheek said, concern product warranties and safety, environmental regulations, accounting and tax treatment of print-to-order revenue, dealer and supplier relationships, and packaging and transportation.

The world’s leader in construction and mining equipment is keen on 3D printing for its on-site versatility.  Cheek gave this example: A Caterpillar truck that carries 380 tons and ferries loads four times hourly, idled with a broken part, could cost a customer $40,000 in downtime per hour. A nearby 3D printer could punch out a replacement part at a vast savings in time and money.

Caterpillar is not only a heavy machine maker, though, and Cheek touched on another use the company is investigating -- printing 3D housing in remote, impoverished areas where it’s desperately needed.

“That’s one of the far-reaching things that got our attention a while ago,” he said.

Caterpillar now has over 80 3D printers – 30 commercial and 50 desktop, as well as an additive manufacturing plant in Illinois.

Northeast Ohio-based American Greetings ventured into 3D printing about three years ago.

Benesch trademark and copyright lawyer Julie Fenstermaker, on a panel with American Greetings executives, along with Benesch lawyer Susan Clady, asked how the card company is reimagining a world in which its products are three-dimensional.

Carol Miller, vice president of corporate innovation, said that while most people think of American Greetings as a paper and ink operation, that is changing. The spread of Facebook and other social media as forums for displaying personal interconnections drove home how they’ve become the modern version of a fireplace mantel for cards.

American Greetings started fashioning new products to stay relevant -- cards that dance and wiggle, flash lights and play tunes. Incubating a series of new ideas, the company hit a road bump. It couldn’t come up with renditions as fast as it wanted. The agility of producing prototypes with a 3D printer was clear.

Today, American Greetings has an in-house 3D printer and three dozen concepts in the pipeline that will be executed with the technology. The company in the future may convert greeting card art into 3D gifts, make “retro” versions of properties such as Holly Hobby dolls, and market a way to transform children’s drawings and photos of pets into 3D keepsakes.

American Greetings will sell the know-how, with the items popping out of home printers.

“We’ll use living rooms as the next new marketplace,” said Patricia Motta, chief intellectual property counsel. “That’s our next new retail store.”

Dave Pierson, senior design engineer at nonprofit manufacturing consultant MAGNET, said such customization, made possible on a mass scale because of 3D printing, will start to overtake factory mass production. Cranking out custom parts will change from a weeks-long task to one taking hours, with costs plummeting, Pierson predicted.

Matt Hlavin, president and CEO of Thogus and several sister companies, spoke on “Debunking the Hype Cycle.” Using 3D Printers, Thogus is turning from a design-for-manufacturing into a manufacturing-by-design parts maker.

Hlavin sees 3D printing as a chance to rejuvenate hollowed-out manufacturing zones and “recreate the middle class.” Thogus works with community and tech schools to draw up curricula for training students in 3D printing, building on traditional math and metal stamping classes. Benesch IP partner Risto Pribisich said a 3D-skilled workforce will evolve over time. 

“If we don’t do it, it’s going to be done overseas,” Hlavin warned, sounding a theme of the seminar about the imperative of getting in front of the coming 3D printing storm.

Hlavin said “hype” today arises from the tendency described by Microsoft founder Bill Gates to overestimate the change that will occur in the next two years and underestimate the change that will occur in the next 10. Consider 3D printing an evolutionary not revolutionary technology, Hlavin suggested.

Another panel taking up the future of 3D printing in Northeast Ohio found the outlook promising.

Michael DeAloia, a tech columnist for the Plain Dealer and chief evangelist for the software development firm The Refinery, said 3D printing plays right into a renaissance of Greater Cleveland’s manufacturing past.

Among the region’s assets: An abundance of unused manufacturing space that could be turned into advanced warehouses for 3D printing, sitting on top of a second-to-none fiber optic network.

“Cleveland has all the nuts and bolts, all the skeleton that is perfect for additive manufacturing,” said Mike Stovsky, chairman of Benesch’s 3iP group. For the investment and commercial bankers in the room, he noted, “part of this is a real estate play for Northern Ohio.”

Lev Gonick, CEO of the nonprofit broadband provider OneCommunity, took a slightly contrarian position to caution against viewing 3D printing as a silver bullet. Additive manufacturing is but a subset of the world’s multi-trillion-dollar innovation market, Gonick said. He urged businesses and community leaders to think as broadly as possible about Northeast Ohio’s “rich opportunity.” 

Nonetheless, 3D printing alone will be massively disruptive, and we shouldn’t be comfortable with little incremental steps, Gonick said.

“This is not yesterday’s manufacturing process. This is something very different, and we better set our sights on the horizon if we want to be part of it.”

Other panelists talked about estabishing an additive manufacturing workforce. 3D printing proficiency doesn’t necessarily require a four-year degree, said Professor Brett Conner, director of Advanced Manufacturing Workforce Initiatives at Youngstown State University.  The demand instead will be for training -- and retraining of existing employees – in specialized skills.

The challenge, said Stovsky, is figuring out how to educate people for a world that is evolving in ways that we can’t yet discern.

Three blocks from Youngstown State, America Makes, a national accelerator for additive manufacturing, is busy commercializing products in the “valley of death,” the precarious stage for startups before their products bring in revenue.

Barb Ewing, chief operations officer at the Youngstown Business Incubator, said Northeast Ohio can differentiate itself as a 3D printing cluster by cultivating such budding businesses. But eventually, Ewing said, startups may be dwarfed by the scale of 3D printing as it’s woven into the region’s existing manufacturing fabric.

A final panel hosted by Benesch Chairman Ira Kaplan looked at where the smart money in 3D printing is headed.

Eric Klenz, managing director of KeyBanc Capital Markets, and Andy DeHart, director of 3D printing at Fisher/Unitech, a leading reseller of 3D software and hardware, said both metal additive manufacturing and bioprinting are attracting dollars.

All told, 3D printing companies have raised nearly $4 billion in public offerings since 2011, compared to just $300 million in the industry’s early years from 1987 to 2010.

Sectors such as auto and aerospace are immediate fits for 3D printing applications. Because of its flexibility, Kaplan said, 3D printing will have a meaningful impact on short product runs that will let businesses avoid expensive changes to factory lines. 

Other sectors enticing investors: advanced materials such as polymers and new alloys, and biomedicine, where work is underway on implants for surgical and dental procedures and artificial skin for the cosmetics industry.

A run-up in stock prices for 3D printing companies a few years ago was followed by a crash in 2015 -- a cycle common in the feverish launch of new technology. Costs were higher and margins not as good as people had anticipated, Kaplan said.

The market for large 3D companies is expected to rebound as printers come down in price and get easier to use, the technology is refined, and developers assemble warehouses and other infrastructure to support the industry.

KeyBanc’s Klenz said established manufacturers are taking note of 3D printing and starting to release significant capital into the market.

Meanwhile, hubs such as the crowdfunder Kickstarter let companies bankroll 3D printing ventures before raising institutional capital. Other funding sources are strategic buyers, growth capital, venture capital and initial public offerings, Kaplan said.

Avsec, leader of Benesch’s 3D printing team, said almost every business should be thinking about the coming sweep of the industry and how it will affect its operations. The change is well underway, yet the magnitude of it is just beginning to be felt.

3D Printing will impact the way we make almost everything.

For more general information and to learn more (including by viewing more than 20 Benesch-produced videos on 3D printing), click here.