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| You may be
able to obtain an exclusive, worldwide monopoly
for a new, useful, and non-obvious process,
item of manufacture, or biological creation
(including non-natural plants). If you don’t
file for a patent, your competitor might, and
then force you to shut your doors. Patents created
GE, AT&T, Texas Instruments, and most other
successful corporations. |
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| This one-hour seminar focuses on identifying patentable
ideas, proving you invented first, and navigating
the patent process. Additional topics include: what
you must NOT do, what must be in a patent application,
the patent timeline, and how much you should budget
for a patent. $95.95 |
| This one-hour seminar covers the basics you must
know to protect your ideas—patents, trademarks,
copyrights, trade secrets, and contracts that protect
ideas. Course materials help you identify what you
have, and the next step to protect your rights. $95.95,
Free when you register - Just Signup!
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General Definitions |
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| For most modern
businesses, intellectual property (or "IP")
is the most valuable asset of that business. Unfortunately,
it's usually completely neglected-particularly by
small and medium-sized companies. There are five basic
types of intellectual property protection: patents,
trademarks, copyrights, trade secrets, and contractually
created IP. Utility patents protect functional or
structural aspects of products or services, while
design patents protect ornamental designs on products.
Trade secrets are any information, not publicly available,
used in the course of business to give a competitive
advantage, such as a customer list. Trademarks identify
the source of origin of a good or a service. Copyrights
protect literary, musical, and other artistic expressions.
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Example |
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| iMAC Consider the
Apple iMAC computer with distinctive colors and a
tear-drop shape? Utility patent protection applies
to the electronic circuitry, to the software that
runs the machine, and the software programs the machine
runs. Design patent protection would apply to the
ornamental feature of the computer-namely, the tear-drop
shaped monitor and unique color scheme. Trade secret
protection applies to the manufacturing process that
allows the manufacturer to produce the computer at
85% of the nearest competitor's cost, and to Apple's
supplier and distributor lists. Trademark protection
applies to the name of the company (Apple) and to
the computer (iMAC) to identify their origin. Copyright
protection would apply to the software on the hard
drive, and to many screen images displayed by the
computer. The license agreement you agree to when
you install software creates additional intellectual
property-a contract.
Eventually, you must be able to distinguish each type
of intellectual property protection in order to prevent
misappropriation of your intellectual property assets.
After reviewing this information, you will take the
first steps to recognizing the value and benefit of
each type of intellectual property. |
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PATENTING YOUR INVENTION |
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| What is a Patent?* |
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| A patent is a temporary
(20 year) right granted by the United States to an
inventor, to exclude others from making, using, or
selling (and by case law, importing) an invention.
A patent is good only in the United States unless
certain steps are taken prior to the disclosure of
the invention. A patent right is sometimes referred
to as a legal monopoly right, since it confers a right
to keep others from the invention, rather than as
a "positive" right to make, use or sell
an invention. There are currently about two million
United States patents issued to inventors that are
still active, and almost half a million pending patents.
Confusion is often created because there are two types
of patents issued by the United States Patent &
Trademark Office (USPTO): utility patents and design
patents. They protect different types of intellectual
property, and provide very different rights. |
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| What's Patentable? |
| Utility Patent: |
| A utility patent
may be granted to protect a new, useful and non-obvious
structure, process (including computer programs),
function, or business method. Improvements to any
of these types of inventions that are also non-obvious
are valid subject matter for patent applications.
The term of a utility patent is 20 years from the
date of filing the utility application. Time Budget
for a Utility Patent: It takes about a week to prepare
a utility patent application, once the job is begun,
and it takes about a year to hear back from the patent
office once one is filed. The total time between filing
and issue can be as short as a year, typically lasting
two years, and may last much longer. |
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| Design Patent: |
| A design patent
protects an ornamental design embodied on an article
of manufacture, or the ornamental nature of the article
itself. It is granted for any new, original and ornamental
feature. The term of a design patent is 14 years from
the date of issuance. It typically takes about a day
to prepare and file a design with the USPTO, and six
months to receive a response from the patent office
once a design patent is filed. Time Budget for a Design
Patent: It takes about a year to complete the design
patent process, though longer terms may be needed
for some designs.
* A prototype or working model is not needed to seek
patent protection. |
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What is Not Patentable |
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| You cannot receive
a patent for perpetual motion devices, abstract ideas,
laws of nature ("discoveries"), naturally
occurring substances, or printed matter. |
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Public Disclosure (this is
not easy to understand!) |
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| An inventor cannot
receive a United States patent for an invention publicly
disclosed in writing by someone else anywhere prior
to the date of the invention. If a publication is
by the inventor, then the inventor has twelve months
from the publication date to file the patent. Public
disclosures also include any exhibit at a trade show,
or printing in a publication anywhere in the world.
You should always seek a patent attorney's opinion
if you have any questions regarding whether your invention
is patentable, and before having any presentation
or discussions outside the scope of a non-disclosure
agreement. ANY DISCLOSURE, BY ANYONE, ANYWHERE, PRIOR
TO A U.S. FILING DESTROYS THE ABILITY TO FILE A PATENT
OUTSIDE OF THE UNITED STATES. |
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Offers to Sale |
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| If the invention
is offered for sale or license, then the inventor
has only one year to file an application for a patent.
It does not matter if no sales are made, or if no
licenses are signed. |
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Public Use |
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| If the invention
is known or used by others in the United States before
the date of the invention by the inventor, then the
inventor is not entitled to a United States patent.
Other statutory and case law bars
exist. Consult a patent attorney about statutory bars
before filing a patent application |
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Should you Patent? |
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| A host of factors
should be considered before rushing to file a patent.
Do you have the time, money, and energy needed not
only to protect your invention, but to push it to
market? Is the invention marketable? Is the invention
producible at a price that allows for effective marketing?
The Invention Factory does not provide marketability
advice, or provide "invention submissions."
We do, however, for a consulting fee, frequently assist
inventors with locating prototype engineers, sources
of financing, and invention evaluations, upon the
request of the inventor. |
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Benefits of Patenting |
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| A patent allows
the patent's owner to prevent others from making,
using, or selling an invention throughout the United
States. A patent is one of the few assets that can
increase in value over time. A patent may also increase
the value of your business because it is considered
a valuable asset by banks, financial markets, venture
capitalists, and potential purchasers of your business.
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Adding Value to Your Business
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| In just one week
in 2001 the following headlines could be seen to cross
the Reuters News Service: StemCells Wins Two New Patents,
Shares Jump [100%] (6/7/01), HP to Pay Pitney $400
Million in Patent Suit (6/4/01), Girl, 9, Starts College
Courses (5/31/01) [describes the patents Ms. Saladna's
received and created a multi-million dollar company
around], and TiVo Secures Key Patents, Stock Soars
(5/25/01), just to name a few. In addition, Patented
technology made Hyperchip the Hot Start-up of the
Year (6/5/01). Check out some of our success stories,
listed below. |
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Marketplace Power |
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| Why do companies
receive so much value for a patent? First, they can
literally prevent competition with their invention,
if that's what they choose to do. You can do it too!
Alternatively, you may decide that you'd rather receive
licensing royalties. Maybe you want the best of both
worlds? You can then produce your product with legal
monopoly profits, and still receive royalties-people
may literally pay you for the right to compete with
you. That's POWER! |
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It's an Asset! |
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| There are many
ways to financially benefit from a patent's asset
character. Your patent may be sold outright. You may
also license your patent to one or more parties for
a percentage of the sale price. You may also create
a business and take the invention anywhere from product
promotion all the way to manufacturing and distribution.
A patent is also inheritable. |
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Risks of NOT Patenting |
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| What might happen
to your business if you decide to not file a patent
to protect an invention? If you think trade secret
laws will protect you, think again. What if a hacker
breaks into your system and publishes your trade secrets
on the Internet? It may surprise you to know that
they are no longer secrets, and are then free for
the world to use. If an employee leaves and publicly
discloses your trade secrets, they become free to
the world. What if a marketing person accidentally
places a copy of a trade secret in a folder at a trade
show? You've just learned another way trade secrets
can be lost. Yes, that employee and hacker broke the
law. Yes, you can sue, but how much money will you
recover? Probably very little. |
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Lost Market Opportunity |
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| Do you use Email?
If the guy who invented it received just a .01 CENT
royalty on each email, he would make over $100 MILLION
A DAY. He didn't patent the idea because he believed
in "open source" (read "free")
software. How nice. Have a quartz watch? Thirty years
ago the Swiss made 80% of the world's watches, and
they kept time more accurately than any other watch
in the world. Then the Swiss invented quartz movement
which is much cheaper and more accurate than Swiss
springs. The Swiss inventors decided not to patent
it-it just didn't fit their business model. Then Texas
Instruments, Timex, and a few other companies decided
that, well, it DID fit their business model. Today,
the Swiss have only about 5% of the world's watch
market. |
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Lost Company Value |
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| Deciding not to
pursue patents can cost much more than a lost opportunity.
It can cost you money. One "last minute"
filer showed up on a Monday with an offer in hand
to buy his business for thirty million dollars. He
had told the buyer that his technology was patent
and otherwise protected. It wasn't. That Friday, he
sold his company for under three million dollars.
This guys lost $27 million dollars in value in a week.
Why? Well, ask yourself what's worth more: 1) a company
with an invention that can be reverse engineered,
copied, and legally reproduced for a few thousand
dollars, or 2) the same company with the same technology
that is protected by patents so that even if the technology
is reproduced, or even independently created, it can
lock any competitor out of the market for twenty years?
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You Can Be Attacked By a Competitor
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| What if someone
else patents the invention? They can literally shut
you down, or make you pay them for the right to compete
with them. Shortly after an invention audit, where
lots of patentable inventions were identified, a company
X decided not to patent their technology (like the
guy who invented email). They decided to rely on trade
secret protection instead. About eighteen months later
I received a fax from him-a cease and desist letter
from a competitor who had just received a patent on
virtually identical technology. Company X was forced
to shut its doors, rather than face an expensive and
up-hill legal battle. What was amazing was that the
competitor's patent was filed six weeks after that
audit meeting. If Company X had pursued protection
immediately, they could still be in business today,
and probably with one less competitor, to boot. |
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Preserving
Your Rights Prior to Filing a Patent
Detailed Record Keeping |
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| Filing a provisional
or utility patent immediately after an invention is
identified is BY FAR the best thing you can do to
protect your rights to an invention. If you fail to
file a patent before a competitor, you'll be forced
into an "interference proceeding" or a court
battle-both are expensive and offer no guarantee of
success. However, next to actually filing a patent
application or a carefully prepared provisional document,
detailed record keeping is the most important thing
you can do to protect your invention since you'll
use the documentation in court or the interference
proceeding. Proper record keeping is important because
it is evidence of the date the inventor came up with
the invention (i.e., the date of invention). DO NOT
MAIL YOURSELF THE INVENTION (AKA: POOR MAN'S PATENT).
Mailing yourself a sealed letter with your invention
documents enclosed does NOT get you a patent, or even
prove your invention's conception date-DO NOT DO THIS,
EVER, PERIOD. All inventors should maintain a bound
notebook for recording inventions. Ask us about our
suggested engineering notebooks. |
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Bound Notebook |
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| Entries in the
bound notebook should contain a clear and complete
explanation of the manner and process of making and
using the invention. All computations, sketches, diagrams
and test results should be entered into the notebook
at the same time. Notebook entries should also describe
all testing performed, the particular type of equipment
used, and the results of the testing, both good and
bad. Additionally, all persons involved in the work,
and their specific role, should be identified in the
notebook entries. Every entry in the bound notebook
should be signed and dated by the participants, indicating
the particular project with which the entry is associated.
If possible, the entry should be signed and dated
by one (or preferably two) witnesses who understand
the invention. |
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Disclosure Document Program (DDP)
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| The Disclosure
Document Program (DDP) is a service provided by the
USPTO that accepts and preserves invention papers
for two years as evidence of the date of conception
of an invention. The DDP is not a patent application.
Please see the enclosed paper that highlights some
problems with the DDS before even thinking of using
it. For example, the DDP information can become part
of the public record-this means your trade secrets
also become public, and are secrets no-more. The filing
of DDS papers is one of the most common ways invention
submission companies commit inventor fraud and cheat
inventors out of money. |
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Patent Searches and Opinions
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| Though not a required
part of the patent process, sometimes the first step
in the patenting process is to have a professional
patentability search completed by an independent patent
searcher. The Invention Factory typically hires independent
patent searchers who can visit the USPTO to perform
manual and database United States patent searches.
However, no one can ever guarantee to find all prior-art,
and that the more thorough the search, the more it
and the related opinion will cost. Think of it this
way: a search can let you know when you can not get
a patent, but can never be 100% relied on to let you
know if you can get a patent. |
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Patentability (Knock-out and
Novelty) Opinions |
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| After the independent
patent search is completed, we compare the relevant
located patents to your invention. A knock-out opinion
is an objective opinion about your chance of receiving
patent protection based on US Patents. The patentability
opinion, along with copies of the relevant patents,
is sent to you. If US and international databases
and other sources are searched (for example, technical
papers), then opinion is called a "novelty"
search |
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Infringement Opinion |
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| Sometimes, an inventor
wishes to know if their invention may infringe an
existing patent, or if a product or service being
offered by another infringes their patent. This type
of opinion examines, element by element, the claims
of a patent to the device in question, and may require
the review the patent file at the Patent Office. |
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The Patent Application and Patent
Prosecution |
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| A patent application
typically includes an abstract, a specification that
describes the invention), at least one "claim,"
a Declaration, a filing fee, and usually at least
one drawing. However, filing an application does not
entitle an inventor to a patent. The patent pass an
examination and approval process known as "patent
prosecution." |
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Claims |
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| Claims are legally
the most important part of the patent application.
They define the invention, and determine the scope
of coverage of the patent. Experienced patent draftsmen
are uniquely qualified to help an inventor receive
the most preferable patent coverage for an invention.
Adequate patent coverage increase the chance that
potential infringers will be prevented from making,
using or selling your invention. Individual inventors
without representation often unnecessarily give-in
to patent office demands to narrow the scope of the
claims in a patent, which can greatly reduce the value
of a patent. |
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Office Actions and Responses
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| After filing the
patent application with the USPTO, a paper called
an Office Action is received from the USPTO (typically
within eight to fourteen months, though some software
application can take up to two years to be examined).
The USPTO will almost always reject some or all of
the claims. Usually the USPTO Examiner will state
that he believes it would have been obvious to create
your invention in view of the prior art (typically
other patents located by the Examiner).
After receipt of an Office Action,
it is then necessary to argue that your invention
is patentable based upon the differences between the
invention and the art cited by the Examiner. Legal
arguments based on case law, as well as structural
differences, may be used to refute the Examiner's
position. A telephone interview with the Examiner
may also be requested.
Sometimes, if an examiner does not
allow some patentable subject matter, additional action
may be needed. This may take the form of an appeal
to the USPTO appeals board. Sometimes, other procedural
tools are used, such as the filing of another patent
application called a "continuation application."
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