It's a new year and a good time to revisit the topic of patent strategies.
Full disclosure, I am not a patent attorney, but I have three issued patents. I have learned a lot from others but also from my own mistakes. My goal is to help you to not repeat the mistakes I made. As I have stated many times in these blogs, my firm belief is that you must do your due diligence by conducting your own free patent search on USPTO.gov before you spend one cent on filing a patent.
For the remainder of this post, I am assuming that you did your due diligence and that you wish to investigate patent options for your invention – especially those that preserve your budget.
Types of Patents and What They Protect
PPA – Provisional Patent Application
The PPA is sometimes called the poor person's patent. The PPA is not, in fact, a patent at all, it is merely an application that is accepted and filed with the USPTO.
A PPA can be filed for as little as $65 (if you do it on your own) or perhaps $2,000 if a patent attorney helps you. A PPA, once filed with the patent office (USPTO), gives you one year during which you can claim patent-pending status before you must file your Utility patent. The PPA is never examined by the USPTO examiner, it is just given a filing number and filing date.
Why should you bother filing a PPA that lasts only a year and is never examined by USPTO?
Here's why. It does permit you to claim a patent-pending status on your invention for 1 year. During that time, you can show your invention around and perhaps may be able to license it to a company, all on a small budget. More about this later.
The Design patent has a 15 year term from the date it is granted. As the name implies, the Design patent protects a unique product design or appearance, not the utility or innovation around how it functions as a product. For example, a clock that is shaped in the silhouette of a cat with its tail curled underneath could be protected by a design patent. If anyone else attempts to sell a similarly shaped cat silhouette clock, they would be infringing on your Design patent.
Here is the challenge in protecting a product with only a design patent: the coverage is rather narrow. A dog shaped silhouette clock would not be an infringement. Similarly, a silhouette of a walking cat might not be an infringement of your Design patent.
The Utility patent has a 20 year term from the date of filing of the patent. As issuance may take 3 years or more, some have claimed the effective term really is about 17 years – from the approximate date of grant. The Utility patent is perhaps the most common patent. It protects uniqueness and innovation around the utility of the product. The product must be both innovative in some way compared to similar items, and it must not be “obvious” in the eyes of the examiner when compared to any reasonable combination of currently existing products – so called “prior art.” Be aware that the examiner will have a much broader view of what is “obvious.” It is not unusual for her to cite 2 or 3 different issued patents that, when combined, might seem similar to yours.
Generally, the strongest patent protection will be conveyed by having one or more Utility patents. Any product being sold with similar features to your Utility patent could be an infringement (in the country of filing of the patent). Thus, a Utility patent is generally needed to license your invention to a company. The Utility patent may prevent others from copying or knocking off your product. Thus, the company you license to will want to have an exclusive license to your product so that none of their competitors may sell a similar product.
Craft Your Patent Plan
One way you may immediately save money, when filing your patent(s), is to file at the lowest cost tier – the micro entity. You can't have been a named filer on more than 4 previous patents and your income cannot exceed 3 times the median household income to qualify – currently about $150,000 total. But, micro entities pay only 25% of the ‘regular' fees that large companies must pay. So, as a micro entity, your Utility patent filing fee would be only $70, compared to $280 for a regular filer. It really makes a difference when your patent issues: regular issue fee is $960, small entity is $480, and micro entity is $240. Don't forget to take advantage of these substantial savings if you qualify as a micro entity.
In general, a good strategy is to initially file a PPA which doesn't cost much. This gives you one year to shop your invention around and see if you can license it. If results aren't encouraging when your year is up, you don't have to do anything, just let your PPA expire and go to your next product idea. If you are fortunate enough to secure a licensing deal, you might be able to have the licensee agree to reimburse your Utility patent filing, examination and issue fees. This doesn't happen often, but a Utility patent will likely cost you $5,000 or more to fully prosecute to issuance.
Sometimes you may discover that another inventor already has a patent on a product that is quite similar to yours.
This means you certainly will not be able to obtain a strong Utility patent for your product. Many inventors simply give up without considering one more very simple strategy: offer to buy the patent from the other inventor.
Some inventors think all they must do is get a patent and companies will come calling to license their product. Not so – licensing is not easy to do. Furthermore, they often fail to realize that, after the patent issues, they must periodically pay patent maintenance fees which become progressively larger. Even for a micro entity, the third fee is $1,850 currently.
This means a frustrated inventor who has spent thousands on his or her invention and gotten nothing in return might be willing to settle for a nominal sum (maybe $2,000). Even if you were to purchase the patent rights for $3,000, you would be able to use it to market your product immediately and will not have to spend 3 years and $5,000+ to prosecute a patent. Something to think about.