Intellectual property can be a company’s most valuable asset. As with any asset, as a business continues to grow, its intellectual property strategy must evolve to maintain the security and sustainability of its innovation. The most effective strategy often involves leveraging new technologies with existing business expertise to maintain a competitive advantage.
Copyrights, Patents and Trademarks are Intellectual Property which can be used to grow a business
Protecting a company’s innovation with a patent, for example can limit or deter competitors from taking and using the company’s innovations. In the beginning, a patent carves out territory for the business to operate without competition. As the business grows, the patent can contribute to the overall value of the company taking it off the books.
Many companies seek patents for new inventions or processes. However, there are many misunderstandings about the patent process which can contribute to a weak intellectual property strategy.
Here are the five most common misunderstandings about patents:
Patent Pending
The phrase “patent pending” does not mean anything beyond the fact that a patent application has been filed. The mere fact that a patent application has been filed or is pending, does not mean that a patent will issue or that the patent provides protection against competition. Typically, patent pending just means that some application has been filed.
Patent Pending Application
Some people mistakenly think that there is some type of patent called a “provisional patent” or a “patent pending application.” Currently, the U.S. allows for an informal patent to be filed as a “non-provisional” patent application. This informal patent is contingent upon the filing of a formal patent within twelve (12) months. The informal, non-provisional patent application, is simply a place holder to provide priority in the event a formal application. The provisional patent does not actually mature into a patent. Provisional patents were originally created to place U.S. patent applicants on equal footing with international applicants who benefited from the international patent application filing system. Any type of patent application which has been filed, give the patent applicant the ability to claim patent pending.
Infringement for Patent Pending Application
A patent application does not mean you have an enforceable patent. Under existing patent laws while an application is pending, the patent applicant can not initiate a lawsuit against a competitor for infringement. While a patent applicant can not sue a potential infringer, a patent applicant can notify the potential infringer about the infringement and damages for any infringement can begin to accrue.
For example, filing for a patent for a technology that allows users to operate apps with their minds does not mean that a patent will issue or that the applicant can sue someone for infringement. However, if a patent does issue, the patent owner can sue for retroactive damages, if notice was provided. While a patent may be pending, the filing of the patent application does not mean that an inventor can sue someone based on the anticipation of a patent. Once a patent issues, the inventor can take steps to enforce its patent.
International Patent Application
Currently, there is no international patent nor any mechanism for filing a single utility patent which is enforceable in all jurisdictions. There is an international process for design patents under the Hague, but at this time, there is no international patent application for utility patents.
There is a formalized process for filing an international PCT application through the World Intellectual Property Organization; however, it is simply a centralized repository which then transmits the PCT application to various countries for further processing. A PCT application, sometimes called an International Patent Application, does not by itself mature into an enforceable patent.
Similar to a provisional patent application, a PCT application is a placeholder that preserves an applicant’s ability to file the application in many countries, including the US. After the PCT application is filed, the applicant must take active steps within a set period of time to submit subsequent follow-on filings in each country which it desires to eventually obtain an enforceable patent. If these follow-up filings are not completed, the PCT application will expire and become abandoned.
Patent vs. Infringement
A patent does not give you the right to make, use, sell or import an invention. The patent only gives you the right to prevent others from making, using, selling or importing the invention into the U.S. A patent does not actually give you an affirmative right to do anything other than exclude others from doing something.
For example, if you own a patent on a four-legged chair, you would have an exclusionary monopoly right to four-legged chairs. This means, that if anyone wants to make, sell or use a four-legged chair, they would need to come to you for permission because you have the patent. However, if you want to make, sell or use a four-legged chair, you may have to go to someone who owns the patent for a three-legged chair patent. Your four-legged chair includes a first, second and third leg, which may be covered by the three-legged chair patent. Before you sell a product covered by your patent, you should conduct a freedom to operate search to determine if others have a patent which covers your invention. A freedom to operate search may help determine if you have the right to prevent you from making, selling or using the invention. As a result of your freedom to operate search, if you find someone has a patent for a three-legged chair, then you may be able to negotiate a license or otherwise agree not to sue each other based on the manufacture, sell or use of the four-legged chair.
Intellectual property can be a company’s most valuable asset and to maximize the value of that asset, a business should develop a patent strategy which leverages the company’s strengths. Understanding what a patent is and is not, is just one step in the process to developing an effective patent growth strategy. If you have questions about developing a strategy to growing your intellectual property protection, contact one of our intellectual property attorneys today.