The Product Development Process – When To Patent
The Product Development Process
When to Patent
When to Patent, and Why
This section on Intellectual Property is an addendum to the Product Development Process article years after original publication. It is stimulated by the many questions from readers. This is a rather important topic in the process, especially for the individual inventor or start-up company. This is NOT legal advice, it is our opinion based on experience.
Please let us know if you have additional questions or comments.
Why Use Patents?
Isn’t it obvious? So no one else “Steals” your idea. Well, no. A patent won’t keep others from “Stealing” your idea, but it does provide some legal leverage for going after someone who infringes. That said, one key thing to remember — A patent is only as good as your pockets are deep. It’s an unfortunate part of the legal aspects of patents specifically, and intellectual property generally.
From my point of view, Patents provide 4 good things, and 3 not so good things. First, the Good:
- Patents provide a method of demonstrating a legal right to exclusive use of an idea – for a period of time.
- If infringement occurs (intentionally or accidentally) a patent provides legal teeth for defining a remedy.
- For companies with integrity, Patents provide a road map of competitors areas to avoid.
- If the intellectual property (the idea) is to be sold or licensed, a patent adds substance, and therefore value.
Second, the Unfortunate Side Effects:
- When a patent is issued, it is published to the world, and you tell the world exactly what you are doing. That can often stimulate other ideas that compete directly against yours.
- When an application is made, the clock starts ticking. Patents offer legal protection for intellectual property, but only for a limited time. Using that time appropriately can become an important issue.
- The way a patent is written can limit itself. The patent not only tells the world what you are doing, but it also tell the world the limits of what you are doing. For someone savvy, that immediately opens the gate for “designing around the patent”. (That’s a request for us at Synthesis fairly often.)
So, Why Patent?
Here are the rules of thumb I use:
- Use patents when the ideas can be discovered by someone (like the competition) who sees or purchases the product.
- Use patents to give substance to the ideas or to a venture. If the concepts (or company holding the intellectual property) are for sale, patents are a good method of assigning value. (Incidentally, this is one of two times I recommend patenting an idea prior to being ready for production. See below.)
- Don’t use patents when it is not obvious or cannot be discovered by an examination of the product. This is often referred to as “trade secrets”. Basically, if the idea is really good and you tell the world, someone will want to copy it, or mutate the idea into something else. If you don’t need a patent, don’t seek one.
- Don’t apply for patents unless you are actually going to take the product to market. There are some exceptions, but lots of people waste big bucks on patents that never go anywhere.
Why Patent Examples:
Product 1 contains a new technology that can easily be discovered by taking it apart and examining how it works. Patent this technology.
Product 2 uses a new kind of machine. The product could be made using an old method that is much slower and more expensive. Don’t patent this. Keep it as a trade secret.
When to Patent:
In reality the patent protects the ideas when they are in production. Unless someone else is working on the same idea at the same time (risk), the best time to apply for a patent is the day before the product goes into production. (Or in some cases, the day before you display it publicly, like at a show.)
I say that a little tongue in cheek, but the concept is to maximize time of protection by the patent. As a nice side effect, this will usually avoid telling the competition what you are doing in advance of actually doing it.
A Personal Note: I have seen many inventors spend thousands to get a patent, then, after several years, when the product is finally ready for production, they find the ideas have evolved such that they are no longer completely covered by the original patent. They end up going through all the expense again for a new patent or CIP.
Non-Disclosure Agreements (NDA)
Use a Non-Disclosure (NDA) instead of a patent to protect the Intellectual Property, especially in the beginning stages of development. It’s much cheaper, faster, and more flexible.
My advice: Think carefully about the timing. Use “Non-Disclosure” or “Invention Disclosure” forms to protect your idea when working with vendors to develop the ideas. These offer reasonable legal protection for very cheap, and it is very common in industry. More important still, as you develop your new product, you’ll find that some things change, and you will want them protected as well. Better to wait on the patent application until the product definition reaches maturity.
What kind of Intellectual Property Protection?
There are several avenues for legal protection of intellectual property — Patent, Trademark, Copyright, etc.. For physical things, like products, patents are usually the choice. For software and artwork products, the choices include more.
The basis for obtaining a patent is the idea must meet several criteria. I’m not the one to elaborate, but in general, it must be a physical item, machine, or method, which is new, useful, and unique (usually they use the word “novel”); and it must not be obvious to one skilled in the field.
There are 2 kinds of patents — Design Patents and Utility Patents:
- Design Patents are generally to protect the artistic nature of a product. For example, for one customer, we design decorative accessories for cars. The protection is design patents which keep the competition from directly replicating the artwork or “design”. A limitation of design patents is they cover only the exact artwork — not variations (embodiments) of the same.
- Utility Patents are generally to cover the way things work. These are the ones with the biggest legal teeth. They cover a lot more (like variations or embodiments that are very similar in function and/or extensions of the same). They also cost a lot more.
Sometimes people classify a 3rd patent type:
- Provisional Patents are not really “patents” in the classic sense. They’re more like place holders that allow time to file the full patent. These are good, in my unofficial opinion, only in cases of time constraint as they are VERY limiting, and usually start the clock ticking prematurely. Consult with a patent attorney carefully before going this route.
As a side note, older patent law was based on “First to Invent”, but newer law now says “First to File”. I suppose this reduces some of the argument about when something was invented, but it now puts a much larger financial burden on the inventor with respect to getting the filing in quickly. Under the old law, there was very little reason to use Provisional Patent applications. Now, with the new laws, Provisional Patents make sense in more situations, but they are still constraining. If you don’t file the full Utility Patent application by exactly 1 year from Provisional Application, then the idea becomes public knowledge and you can NEVER patent it. 1 year may seem like a long time, but it flies by and you loose all rights. Yes, it’s that bad, so think carefully before applying.
For more in depth information on intellectual property protection, read the Patent Law FAQ available from Gould & Whitley — an excellent overview, from a good patent attorney.
Concluding Thoughts . . .
Patents can be very expensive. Perhaps you’ll drop $15,000 on the initial patent application, then you’ll pay more in attorney’s fees to prosecute and answer USPTO office actions. Hopefully it gets approved and the patent issues. (If not, you’ve wasted the money.) After issuing, there are maintenance fees, and they keep coming till the patent finally expires. Unless you’re actively using them, patents are a money pit.
Why so sarcastic? I’ve seen so many inventors flush amazing amounts of money away chasing patents — money they didn’t need to spend. I’m not against chasing dreams — quite the opposite! Just plan appropriately, and don’t gamble your life savings on a hope that your widget will make you rich. Instead, plan carefully and realistically — chase the dream with your feet on the ground — then you’ll probably achieve it.
I am an inventor. I understand the emotion, and I understand the dream. Intellectual property is important.
My advice: Cautiously address getting patents, and be sure your business plan supports the return on investment BEFORE you apply for a patent. Don’t force it. Walk away if it doesn’t pan out.
Links To More
- For help with patents / intellectual property, and for specifics about your particular project, please see a patent attorney. They are the only ones to give proper legal advice about patents.
- If you’re an inventor, check out the Inventors Lab as a guide through many things inventors face.
- For assistance with designing or developing your product, please drop us a line.
Next Up: Patents: Protecting Your Big Idea