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Intellectual Property and Patent Protection

If you are like many of our clients, after the Client Inquiry Meeting, you have identified your new idea as a potential business opportunity and determined it is worth pursuing further. If you have not read my previous blog “Small business ideas, big business opportunities,” please do so. This will help you understand the difference between a common idea and a rare business opportunity. The post provides tips on how to perform an opportunity feasibility analysis to determine if your new idea is worth the commitment of time and money to take it further. It is a crucial step in turning ideas into business realities that I cannot emphasize enough.

With any new idea, or intellectual property, comes some added fears of theft. You are worried to talk about your ideas because you fear someone may try to steal them. You might fear competitors may get wind and quickly adjust their product to provide the value your invention creates for their customers. These are legitimate concerns. Keeping your ideas to yourself in light of these fears seems like the right idea, and in some cases it is. However, keeping your idea to yourself can significantly slow down any development progress. Many times, by sharing your idea, a person you are speaking with may have just the right contact, resource, or expertise you need to help bring your idea to life. But, if they don’t know what you’re doing then this discovery cannot be made. This is where non-disclosure agreements and patents can come in handy. This blog post primarily focuses on patent protection. It is essential to go through the initial patent steps to help ensure that you are not infringing on an existing patent or product before spending tons of money and time on something you could never legally bring to market.

How to protect your intellectual property

Protecting your ideasTo start, a non-disclosure agreement, or NDA, is a contract signed by the owner of the idea with any party they are sharing the idea with. It basically states that all related discussions to the idea are confidential to the signed parties and cannot be discussed with other parties that are not part of the agreement unless authorized by the owner, otherwise legal action can be taken to compensate for the breach of contract and any resulting damages. This agreement allows you, the idea holder, to speak candidly with someone since they are now held accountable and will be more hesitant to disclose any of your ideas. Another method to protect your idea, which is also the most known is Intellectual Property protection or IP for short. IP comes in four forms: Copyrights, Patents, Trademarks, and Trade Secrets. This post will be outline patents since at Elite Innovations, we specialize in product development where patents are most commonly used.

How to patent an idea

For something to qualify for a utility patent, the idea must be novel, non-obvious, and useful. As part of our services, we help our clients gain IP protection on their ideas. There is typically a two-step patent process recommended to startups for two reasons; one is to file a provisional patent to give the inventors 12 months to be able to disclose their idea, work the kinks out, and raise money, and the second is to file for their full patent, normally a utility patent with products to protect their ideas going to market and open up potential licensing opportunities. Patents become an asset to a company because they can be used to create barriers to entry for potential future competing companies, patents can be licensed to other companies and the patent holder will be compensated for allowing them to use the patent in their products, and patents can be sold outright.

The provisional patent is basically a placeholder to a full patent. This secures the date you filed your provisional patent and the date is transferred over to your full patent, once issued. The date is absolutely critical since the United States is a “first-to-file” country which means that whoever files the patent first becomes the owner of the idea if approved by the US Patent and Trademark Office (USPTO). For instance, let’s say you have the idea, and you tell a company you would like to license the idea to. That company sees you don’t have a patent-pending status and they quickly file a patent before you do with their own money. Regardless if the idea came from you, they now would be first-to-file and have ownership of the idea once approved by the patent office. You no longer have claims to the intellectual property, nor the opportunity to sell it. The provisional patent helps secure that first-to-file date at a fraction of the cost of filing the full patent. Full patents can cost $6,000 – $10,000+ depending on complexity and number of claims you are protecting.

Provisional Patent vs Utility Patent

The provisional patent is broader and does not necessarily have all the claims that would be present in your full patent but establishes the general idea of the novelty, non-obvious, and usefulness of the idea you wish to protect. It then allows the inventor 12 months to choose to file for the full patent, in many cases a Utility Patent, and raise the necessary funds to do so. Note, if you do not file for your full patent within the 12 month provisional window, then you lose the opportunity to file the patent. There are some other things you can do if this situation arises that are advisable by a patent attorney.

During the provisional twelve month period, the inventor can make adjustments to the design, test and validate with customers, sell the product or pitch to investors to raise money, and publicly disclose the idea. Public disclosure is an important concept to keep in mind. If an idea is publicly disclosed prior to any patent-pending status, or let’s say sold for a couple years prior to filing for a patent, then the idea can no longer be patented as the idea is already public knowledge now and anyone can produce it. From U.S. patent laws, a person is not entitled to a patent if the invention was “known or used by others in this country, or was patented or described in a printed publication in this or a foreign country.” So before telling the world about your idea be sure to consult a product design company like us, at Elite Innovations, or a patent attorney, or you can choose to file independently.

How to file a patent

Thomas Edison Light Bulb PatentPatents can be filed by yourself through the USPTO online. The patent office is currently back-logged and it may be 1-2 years before you find out if your patent was accepted. However, your filing date is still secured. So if your first attempt is rejected, which is common, they will tell you what needs to be fixed and you can readjust to meet their needs. This is good and bad in that it helps you identify key features or claims that are able to be patented, and it shows you what areas you may need to work around and adjust. My patent attorney and good friend of mine Doug, a fortune 50 patent attorney, always told me to swing for the fences on a patent, try and get as much of the claims as you can. This way if you get a large, broad patent GREAT, but if not, you can always refine. The broader the claim, the more licensing opportunities and protection you can get. Utility patents last 20 years if filed after June 8, 1995.

I stated earlier you can file yourself. This is convenient but not always the best way to go with intellectual property. Patent attorneys like my friend Doug are great resources to do this. This is because they have years of experience identifying what makes an idea patentable. They can also perform IP searches, where a patent attorney or firm searches through the existing patents to see if your idea does not infringe on any of those patents. A provisional patent and IP search could cost a few thousand dollars. However, this is crucial before moving forward with pursuing an idea. Imagine if you filed your own provisional after doing some Google searches for products and searched briefly through the existing patents with limited knowledge on what to look for, and then spent $25,000 or more and hundreds of hours developing a product to take to market just to find out that you can’t sell it because it infringes on existing patents. I can’t stress enough how important it is to do your due diligence first.

How to do a patent search

As I stated, you can file yourself, but it is not recommended. However, doing your own research ahead of time is great and can help save you some money with the IP attorneys. Save any relevant information you find for your patent attorney. There are a few ways to conduct your own research:

I know all of this can seem like a lot. Keep in mind I am not a patent attorney and none of the information in this blog is legal advice. I am speaking as an inventor, entrepreneur, and product developer that has worked with many patent attorneys over the years. I am merely providing a quick, go-to guide for some considerations to keep in mind to protect your intellectual property. All of these topics and concepts should be discussed with a licensed patent attorney. I highly recommend not using a general attorney firm. Find attorneys or firms that specialize in intellectual property.  Just like any other professional service, you want an experienced professional in that field. Remember to ask an IP attorney about their background. All patent attorneys have some sort of engineering background, and typically it is good to find one that fits the application. So, if you are patenting an electronics product, then it would be very beneficial to find an IP attorney that has a background in electrical engineering, and not chemistry.

I hope this helps with the development of your idea. Remember, if you have not read my previous blog on ideas vs opportunities, please do so before pursuing intellectual property protection. This will help save you in the long run to assess if it is worth the money and time to go forward with IP protection. As always, feel free to contact us or respond in the comments with any questions or if there are things you want us to touch upon in future blog posts. Thanks for reading.

4 thoughts on “Intellectual Property and Patent Protection

  1. Thank you for a very informative article, Ed. I have a question concerning crowd funding. As you wrote, “From U.S. patent laws, a person is not entitled to a patent if the invention was ‘known or used by others in this country, or was patented or described in a printed publication in this or a foreign country,'” then how does that work when one publicly fundraises? I mentioned in a Kiva Zip update that my prototype has a wooden base. That’s published on a website. Would that negate chances for a patent?

    Also, what about product testers who know about and use the product in the U.S.? I have an advisory panel of fiber artists around the country who test my products. Is that practice an impediment?

    1. Thank you for reading and posting these questions. Those are good questions, especially concerning crowd funding since that is a very popular and currently common method of raising funds and validating ideas. To be safe, I would recommend not publicly disclosing pictures or details of your idea, especially selling or raising funds publicly. Just stating that your idea has a wooden base does not really disclose your idea as many things have wooden bases. As for product testers, all products should go through proper testing, however it is up to the inventors to make sure they have proper protocols in place to ensure that you are enforcing the necessary procedures to protect your idea from public disclosure. This is where non-disclosure or confidentiality agreements can come in handy. This way you have done your due diligence and informed the testers they cannot disclose details, images, etc. from disclosing to others whether it be in closed door discussions or publicly online. Make sure your testers know this and that they are part of confidential testing. As a patent becomes approved, the information on your idea is now in the public domain and all parties can review your patent and it becomes, in a sense, public knowledge. And please remember everything I am saying is from my experience working with patent attorneys, but I am NOT a patent attorney. You should always speak with a certified patent attorney, like Carla Gannon who also commented on this thread, for things like this. Hope this helps! Best of luck!

  2. Ed — this is a great overview. I have a couple points to add:

    1) Consult with a patent attorney early in the process. Some deadlines for filing a patent application (either a provisional or a non-provisional) are written in stone.

    2) An inventor who wishes to file their own provisional patent application should go for “substance over form”. They should include everything — engineering drawings, renderings, photographs, technical specifications, identity of materials and name of suppliers, how to use the invention, Power Point presentations, data tables, etc. etc. Contrary to popular belief, being vague doesn’t lead to broader protection.

    3) Non-provisional patent applications should be prepared and prosecuted by licensed patent attorneys. Period.

    4) The proper agreements should be in place before others (consultants, manufacturing folks, etc.) contribute to an invention. Otherwise a hired party may become a co-inventor and gain associated equal rights in the invention.

    1. Hi Carla! Thank you so much for reading and adding those very good points!

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