Do You Know What You’re Looking for? – Clarifying Your Patenting Goals
Before you begin spending money on the patenting process, it is important to clarify what you hope to achieve with patents. Too many times, we have encountered clients who dove into the process without a clear understanding of what they hoped to achieve, only to be disappointed at the results and the expense of getting a patent.
Communicating your specific goals to your patent attorney will allow you to better tailor the process to your needs. Patent applications are not a “one size fits all” endeavor. Applications can and should be tailored to the needs of the client.
There are several dimensions to think about in considering what your goals are. Two of the key ones are: 1) How do you hope to generate revenues as a result of the patenting process, and 2) where do you expect to generate revenues as a result of the patenting process. Let’s take each dimension in turn.
How to Generate Revenues from Patents
Patents can generate revenues for their owners in several ways, including the following:
1. The owner can sell his patents outright.
2. The owner can conduct a licensing program to obtain lump sum royalties and/or royalty streams based on licensee sales of patented products.
3. The owner can make or have someone else make patented products and exclude others from making similar products by using patents to increase market share.
4. The owner can cross-license his patents to obtain access to the patents of another company.
The particular goal can strongly influence the optimum patenting strategy. For example, if your goal is number 3, you will want to make sure that your patent claims cover your products. In other words, your products must include every limitation of at least one of your patent claims in order to be protected. You will want to let your patent counsel know about product changes and developments as they occur so that claims can be amended and/or new applications can be filed as is necessary. It may require deferring filing your applications until you have a good sense about how your products will be designed or filing additional applications as new refinements are developed.
Conversely, some companies want to tailor their product designs to areas that can be patent protected, in which case, you will want to conduct a state of the art patent search to see where the “white space” is in which you can develop patent protectable innovations and let those innovations drive the product development process.
To get real value out of the patents, you will want to also consider the ways in which your competitors may try to design around your patent claims by omitting features in your claims. You will want to think about how your competitors may obtain the main commercial benefits of your products without using their patented features. This thought process may generate additional claim sets or patent applications to pursue.
Some companies have goal number 3 in mind, but are more concerned about simply protecting their specific products than with obtaining comprehensive claim coverage. For example, some companies are more focused on the marketing cache that comes with patent protection than with obtaining broad rights to exclude others from the market. If that’s the case, what’s most important is obtaining claims that cover your products regardless of whether they can be designed around. In general, this is a less expensive proposition than seeking broad rights to exclude, so it is critical to clarify what you hope to achieve. If, on the other hand, you do wish to maximize your market share, you should monitor your competitors’ product developments and pursue blocking claims even if you are not practicing them.
If your goals are number 2 or 4, you will want to make sure that your patent claims cover your target licensees’ products. This requires keeping abreast of the developments in the market place and information about where your competitors are headed. It also requires innovating around the licensee’s technologies. In general, you may wish to seek broad claims around different points of novelty. You may also want to file continuation applications so you can pursue new claim strategies as the market develops.
If your goal is number 1, it still may be important to cover the potential or actual products of someone in the market place, but it may be less necessary to seek comprehensive claims directed to different points of novelty. Also, your involvement with the patent will end after the sale, so you will not need to concern yourself with filing continuation applications. Therefore, this revenue generation model may be less costly than some of the others.
Do you plan on ever suing anyone to stop infringement? If your goals are 2 or 3, you will also want to consider what will happen in litigation proceedings because you may have to sue infringers to get them out of the market or force them to pay royalties. In that case, you will want patents written with an eye toward litigation, and in particular, with an awareness of the strategies that infringers use to avoid liability.
Where to Generate Revenues from Patents
Patents are territorial. There is no single “international patent” that provides protection throughout the world. The Patent Cooperation Treaty provides a mechanism for filing a single international application. However, the application must ultimately be prosecuted in the jurisdictions of interest in order to obtain enforceable patent rights.
There has been an effort to harmonize the patent laws of various countries, most notably with the America Invents Act signed into law last year. However, the laws—and their application—are not harmonized. We recently posted about some of the difficulties in patenting outside of the United States. Determine where you want to seek patent protection early so the drafting and application filing strategy can be tailored accordingly and so you do not unwittingly create prior art against yourself that will prevent you from obtaining a patent in a country of interest.
Considering the foregoing issues will ultimately help you develop more focused and commercially valuable patents.