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Intellectual Property 101

Intellectual Property 101

Synopsis:

Exploring the elements and components of Intellectual Property (IP) from patent scope, identifying  strengths and weaknesses and what to look for, licensing, branding and trademark potential, percentage of IP ownership and value of all IP (patent, trademark, copyrights). There are many possible combinations evolving from and through each individual circumstance, and possessing adequate proficiency will prepare you for the best and most profitable outcome.

Purpose:

Understanding these essential components is imperative for developing a strategy customized to your circumstances.  Should you to pursue a patent, or opt for an alternative approach such as an aggressive first to market strategy? Perhaps the best path for you is to license or sell your IP. All of these components create a synergy that will affect the value of your intellectual property. Engaging an IP management firm, with a full complement of relevant services is also worthy of consideration, even if simply to have it available as a reserve stratagem.  Fortunately, IdeaShares is designed to place both the power of knowledge and the tools to manage your own intellectual property. However, if your idea is a “game changer” or you simply lack the desire to self manage; hiring an established, reputable management company might well be an excellent choice for you.

 

Patent Scope

    There are many strategies to consider related to how best to proceed with patent protection.  If a market for your product is cluttered with many patents, then a relatively broad set of claims may not be a practical goal, however, a narrow set of claims may still be valuable to your product and market.  Even so, a relatively narrow set of claims need not be so narrow they become an example of being “not worth the paper they are printed on”.

    Every patent must have at least one independent claim.  This independent claim is the key to whether you have relatively broad protection or relatively narrow protection.  For instance, let’s suppose there is a new patent filed for was some kind of kitchen and cooking strainer device.  An example of a non-robust and relatively narrow independent claim might say something like this:

    Claim-1... We claim a kitchen and cooking strainer device comprised of the following;

    • a plastic handle portion for gripping must have a thickness of between 0.200”-0.250”;
    • and the edges must have a smooth radius measuring between 0.050”-0.060”;
    • and the length of the handle portion must be between 4”-5” long;
    • and the end of the handle portion must have a hole for hanging;
    • and the hanging hole must be between 0.400”-0.500” in diameter;
    • and including a round strainer portion which must be between 6”-8” in diameter;
    • and including between 55-65 strainer holes in the strainer portion;
    • and each strainer hole must be between 0.100”-0.150” in diameter;
    • and each strainer hole must be spaced apart from adjacent holes at a distance of 0.250”
    • and the color of the strainer device must be pastel green.

    In the sample independent claim above, EVERY referenced item listed in the claim MUST be included in the patented product in order for the inventor to have exclusive protective rights to their invention.  If someone else and another company make and sells a knock-off copy of this patented product so that it includes EVERY referenced item listed in the independent claim – then there is likely a case of infringement taking place.  However, if the knock off product leaves out any one item in the list and/or changes some detail of the items in the list – it is likely that there will be no infringement.

    The previous example of an independent claim for a kitchen and cooking strainer is VERY narrow and NOT ROBUST because someone can easily get around the primary independent patent claim just by varying any ONE item listed in the independent claim.  For instance, a competitor could make exactly the same product as claimed, but make it in a “blue” color and not violate this patent.  Or, make essentially the same product with a different number of holes, or a different size hole, or a different spacing of holes, or a different handle configuration, or simply put a hanging slot in place of the hanging hole – any one of these alternative configurations would not violate the independent claim of the stated patent.

    The alternative product which narrowly gets around the patent would not necessarily be patentable, but that is not the point!  If an individual person were to have an idea for this kitchen and cooking device and secure a patent for it with a claim similar to the one articulated above, they may have a patent for a product which costs them tens of thousands of dollars, and may even have much more money invested in molds and samples.  If this individual then tries to entice a kitchen product supplier to license and/or buy their product to include it in their expansive product line and distribution network, the reality potentially will rise up and teach a hard and disappointing lesson.

    Assuming the device serves a useful purpose, the large kitchen product supplier would not have to entertain buying or licensing this product.  All they would have to do is start making, distributing, and selling a similar product in their expansive product lines – just by changing any one of the very narrow and restrictive requirements of the independent claim.  The large kitchen product supplier would not have to spend money to file a patent or pay royalties.  As a result, the individual inventor would effectively be bypassed from being able to make a return on the investment of their patent and development efforts.

    This scenario is indicative of the experiences of many wishful individual inventors each year.  Some statistics suggest that less than 1 in 1,000 utility patents filed ever see enough return on investment to even repay the cost of the utility patent, much less recover the cost of product development, much less generate a profit. While these kinds of statements sound discouraging, it is even more disheartening for the inventor to lose the chance to at return on investment because of poor patent claim strategy.

    It is unfortunate that many inventors fall victim to poor patent claim structure and/or a poor strategy in the preparation of the patent they file.  The more understanding one has about how to structure claims for robust protection and/or ensure the patent preparer has a good working knowledge of patent strategy for robustness, the more likely the inventor will end up with a potentially robust set of patent claims.  It furthermore unfortunate there are numerous companies which take advantage of an inventor’s personal knowledge or more accurately take advantage the inventor’s lack of knowledge about patents and lead them to spend many dollars on virtually useless patent efforts.  Many inventors actually end up with a patent after spending their resources – but it is so restrictive and narrow it is not protecting the intentions and/or hopes of the patent holder.

    A primary strategy of an inventor seeking Utility Patent protection should potentially include personal efforts to learn, understand, and educate one’s self about patent claims at least well enough to be able to properly evaluate how well a patent firm, patent site, and/or anyone working on a patent with you or for you, is able to advise your efforts in a non-bias nature for your best interest and best use of your resources.

    This strategy of self-awareness of patent claims should be used to even evaluate “this site” and any assistance you anticipate might come from and/or be provided by this site.  Unfortunately, many patent firms and patent services do not have the inventor’s best interest at heart – rather they will present the inventor with encouragement about their invention as though “anything the inventor comes up with is met with praise and reassurance their invention is the “best thing since sliced bread”.  This unwarranted and/or unmerited praise and prompting from a patent firm in turn incrementally leads many a hopeful inventor blindly down a long expensive path of resource dilution with little or no viable useful results at the end of the road.

    It is unfortunate that many inventors should have been given feedback about their respective patents related to the reality of how practical their invention is, or how likely is they will receive a return on investment for their invention, or any one of several other appropriate feedback options which would have properly advised the inventor to change directions before proceeding full speed ahead toward an expensive useless patent effort.

    Sometimes, the best and most valuable advice and feedback about an inventor’s invention is to NOT SPEND ANY MORE TIME OR MONEY pursuing the product, but rather focus all the creative spirit, energy, capability, and resource on other ideas which may be more likely to produce the expected outcome the inventor is hoping for.

    There is a combination of sad facts that many inventors become somewhat blinded and/or so caught up in their personal involvement and passion for their invention that they become easy targets for less than noble patent firms to effectively capture them and take advantage of their passion.  Self-awareness education and understanding of the patent process, by the inventor, is one of the primary keys to exposing frivolous patent efforts and at the same time fundamentally strategic to promoting the inventor’s individual efforts leading to a successful patent effort.

    Another patent strategy for an inventor with several potential patents which are all related to each other, as part of a system and/or family of parts, is to prepare them so that at least one of patents is filed as a system.  In the system patent, every detail of each component of the system is not particularly claimed in detail as to how each component is designed but rather the system is claimed based on the kinds of components are in the system and what the system does.   The strategy is to establish a patent claim to “what” the system is trying to accomplish as the primary focus of the disclosure and the primary language of the claims.  

    This strategy is then further expanded to include the individual components of the system by filing individual component patents so that now the details of “how each component works in isolation to contribute to the whole”.  The end result of this strategy is to build a “robust portfolio of intellectual property” rather trying to include everything into one single patent attempting to cover claims on the system and claims on the components of the system.  

    If the inventor tries to file one inclusive patent covering the entire system and the components such that the claims include “what” the system is trying to accomplish AND the claims include details of “how each components is contributing to that accomplishment – then what often happens in the official office actions by the patent examiner is that the examiner if forced to attention on the claimed details of the individual components rather than staying focused on the system in its entirety.  As a result, if the examiner finds any one detailed component to be in conflict with any other component in the entire prior an art patent record, the examiner is likely to deny and reject the entire system claims.  For this reason, most attempts to successfully apply for system patents end up being denied.

    Therefore, it may be a much better strategy to break up the components of a system into detailed individual component patent applications which support and expand upon a system patent – and let the system stand on its own in claims of “what the system accomplishes” so that the focus of the examiner remains upon the system and is not forced into a distracted to concentrate on the details of the minutia of various components.

    Another patent strategy for an inventor could be that if they have access to a wide distribution of products and/or if they have a portfolio of a family of products well placed in the market place and they are simply improving on their own current patent or patents, then filing a secondary patent on top of an existing patent may be worthwhile – even if the secondary patent would be VERY narrow in scope and/or claims.  In this strategy, the subsequent patent might not be worth very much “if it was all the inventor had”, but in combination with the prior portfolio, the entire patent portfolio can be made substantially more robust by adding a few rather narrow patents.

    One strategy for establishing a path to set the stage for subsequent patents is to prepare and file an a patent application which contains disclosure references to bits a pieces of the technology associated with the subject invention which are not subsequently included in any of the claims of that patent application.  As a result, if the patent examination process is successful to render a letter of patent on those claims, then the inventor is permitted to file subsequent patents through a process called Continuation In Process (CIP) which is basically a new patent which is supplemental prepared and filed with a new set of claims based upon information previously disclosed in the initial patent but was not included in the original claims.  This new CIP patent application will also be protected by the original patent and share the Priority Date of the original patent.  

    As a result, it is possible to start out with a strategy of a successive line of patents forecasted to be filed continuation for many years down the road which are all based on the original patent Priority Date.  As such, the normal 20-year life of the patent is effectively extended through an ongoing series of CIP patents constantly expanding upon the original patent.

    Another patent strategy is to consider if the invention can be filled and claimed with a “method or use” as part of the claims.  A method patent can be much more valuable than an individual component patent because it is potentially disclosing and claiming “how” something is used, and not just focused upon the things being used.  Therefore, a method patent is often a more robust patent than a simple component patent.  The strategy for how a method of use patent is prepared and disclosed and especially how the method claims are articulated is something which requires careful attention and consideration in order to result in a successful conclusion – but the rewards for pursuing this strategy are usually well worth the effort.

    Still another patent strategy is to consider if a process patent is warranted.   A process patent is a more detailed version of a method of use patent in that a process patent might include details and claims for how an invention is manufactured.  This kind of patent is often difficult to protect and not worth filing because if a relatively and/or potentially unique manufacturing process is developed as part of an invention, then to disclose it to the world exposes it to the public domain and it is no longer a secret.  

    As such, processes and unique manufacturing methods are usually kept secret and considered to be Trade Secrets of a company.  The reason someone would file a process patent is because if the resulting manufactured product could only be produced by using the claimed process, then someone (or a company) can police the market place looking at the products produced and know if someone was using their patented process.  On the other hand, if a unique and potentially patentable process cannot be detected by the observation of the product produced, then it becomes virtually impossible to know whether or not a competitor company is using the patented process.  Therefore, process patents are rather few and far between – but often times such a patent may be worth many time more than the patent on the products produced by the process.

    It may be apparent from the above discussion about patent strategy, that it is appropriate to establish a good plan for how a patent is filed and what is actually being claimed and how the invention is being disclosed – and especially how the claims are being organized.  There are numerous individual patent consultants in the industry who provide a service for a fee solely to help inventors, companies, and even patent professionals, to establish the best patent strategy for a product and/or a product line.  Most individuals desiring to file a patent probably cannot afford the services of a patent strategist, but perhaps knowing such services are available is helpful to some people in certain circumstances.  

    At the very least, it hoped that this discussion will be insightful for individual inventors to be more cautious and deliberate with the claims and strategy of a patent they desire to prepare and/or have prepared.  Careful attention should be given to a strategy for how the patent is organized, what is actually disclosed, and what is actually being claimed.  Furthermore, it is paramount to whether a patent will be granted or denied, how the independent claim(s) and dependent claim(s) are organized and structured.  

    At the conclusion of the patent process, these considerations are often reason some patents are granted while others are denied.  A properly prepared set of claims combined with a good patent strategy are more likely to result in a patent being granted – and be a patent which has a robust set of claims.  In contrast, a poorly prepared set of a claims and poor patent strategy (or lack of a strategy) are more likely to result in a patent being denied – and if granted – not being be worth the paper it is printed on.

Branding Potential

    Every product does not necessarily include the potential to develop and/or introduce a new brand to the market place.  Some new inventions and products are simply one more in a series of existing brands.  If a product is one more in a series of existing brands then the branding potential is answered because there is an existing brand to receive the new product.   

    If there is not an existing brand to which a new product belongs, then there may be an opportunity to establish a new brand.  Therefore, some consideration should be given to a brand name, appropriate logo art work, and even an appropriate domain name.  Sometimes a brand name and/or logo or even the right domain can be one the most valuable assets in an intellectual property portfolio.  

    Establishing a new Brand starts with selection of a potential Brand name and/or a product logo, both of which may require and/or justify some appropriate creativity.   Some of the key things required to establish a brand include addressing a brand identity, a brand essence, a brand personality, and brand positioning.  

    Brand Identity might include a logo and/or a tagline, which is one way people recognize the brand.  Brand Essence is what people who may be potential customers identify with in the brand.  The essence of the brand people identify with might include concepts like trust, performance and/or luxury.  

    Brand Personality is how the brand is perceived which might include concepts like fun, serious, exciting, adventurous, no-nonsense, heroic, etc.  Brand Positioning is an important aspect determining how to position the brand against other competitive brands in the market place.  Depending upon your area of expertise, you will need assistance in brand and image development, but the odds you can acquire a recognizable brand are typically improved when accompanied by a supporting marketing approach.  

     

Trademark Potential

    An important aspect of branding and an intellectual portfolio is often a TradeMark.  TradeMarks may be a “word” and/or an artwork “logo”.  Trade Mark law is a very complex set of rules and considerations, even more so than that of patent law.  It is often quite advisable to seek the assistance of a TradeMark professional. Appropriate attention and consideration should be given to a potential Trade Mark which might also match appropriate domain names for marketing purposes.

    Domain name availability is a potentially congested selection process.  Some domains are available when searched, while others are available for purchase.  Either way, a TradeMark is potentially much more valuable when it can be combined with appropriate domain names.

    Word or phrase Trade Marks which are clever, catchy, and/or say what the product does may be more valuable than TradeMarks which are non-descript or difficult or confusing to remember.  The same considerations also apply to an artwork logo TradeMark, because clever logo TradeMarks which are easily recognizable, easy to identify at a glance, and/or are memorable are potentially of great value.

    Usually, it is advisable for most inventors to seek appropriate professional assistance and advice in searching potential TradeMarks.  Most people do not have access to all the search parameters available for searching TradeMarks, and even when presented with search results, it usually requires a trained professional to render an experienced opinion and strategy going forward to avoid potential TradeMark infringement situations.  This field and discipline of expertise is not as easy or obvious as it might seem on the surface.

     

Inventor Ownership

    All inventions are owned by someone.  The ownership of an invention may be one person or a shared by a group of people or even a company.  Ownership of an invention is not necessarily synonymous with named inventors.  It is common for an invention to be owned by someone and/or a company for which none of the inventors work for or have any participation.

    The normal document used to establish ownership of an invention is known as “assignment”.  Usually all named inventors must assign the invention over to someone and/or to a company who will effectively be the owner of the patent.  The USPTO has very clear rules about who is eligible to be a named inventor on a patent and who is not eligible to be named as an inventor.

    Basically, anyone who contributes to a claim articulated in the patent, by law, must be named on the application for patent.  If during examination and prosecution of the patent, certain claims are eliminated, of which a named inventor’s contribution are limited too, then that named inventor is summarily removed from the list of named inventors.

    In a similar way, patent law also prohibits the exclusion of someone who contributed to the patent, regardless of how significant or insignificant the contribution may have been, just so long as the contribution is reflected in the claims.  Contribution to the claims of the patent need not be limited and/or inclusive of independent or dependent claims.  Companies and/or organizations are prohibited from being included in a patent be named inventors.  

    The greater the number of people are, who are included in the ownership of a patent, regardless of whether or not they are named inventors, then the more diluted any one individual or entity’s percentage of ownership will accordingly be.  If a patent has little or no value or chance of providing a financial benefit to the owner(s) then it may not really matter what percentage of the patent someone may own.  From a financial point of view, owning a 100% of nothing is still nothing.

    However, if a patent has huge potential financial benefit to the owner(s) then even a very small percentage of ownership may actually be quite valuable.  Therefore, consider ownership carefully as a potentially valuable asset worthy of thought and stewardship as to who owns percentages of intellectual property.

    It is easy to understand this concept if you consider an apple pie as an example.  The more you slice the pie, the more people share in the taste, but also the less filling each serving ends up being.  In addition, each slice will not necessarily be equal for all participants.  Therefore, careful attention should be given to how many slices of the pie are being served and careful attention and consideration should be given to how much each slice of the pie represents of the whole.

Total IP Value

    The total value of Intellectual Property not only includes a patent and/or a series of patents, but also includes Trade Marks, Brand names, internet domains, websites, logos, and other similar things.  Another very valuable asset of total IP inventory may be considered as being to include any and all Trade Secrets which may be associated with the invention, patents, and manufacture of the products associated with the intellectual property portfolio.

    The potential value of a patent may be may be greatly reduced if the claims are poorly written, while the potential value of a patent with well written claims might be increased.  If an inventor does not know they have a poorly written patent, then their personal estimate of the value of their patent may be over rated.  This same scenario should be a reasonable concern to the owner of each of the items in the intellectual property portfolio to try and establish a proper valuation of intellectual property.  Perhaps the help of an intellectual property assessment appraiser is helpful for accurate valuations.

Alternative Intellectual Property Strategies

    There are numerous patent related firms and services for helping inventors to prepare patents, and it is well known by many inventors to be careful to properly screen and/or vet patent help firms and services.  In the same way, there are also some very specific intellectual property services and/or specialist.  These services and specialist can be found by internet searching, but careful vetting and screening should be conducted before employing any services.

    Properly vetted professional patent services and/or intellectual property services can be a very valuable resource to an inventor and/or to the owners of intellectual property.  The cost/benefit of using third party services must be considered compared self-management options.

    Another potential intellectual property strategy is to seek out companies in the related field(s) of the intellectual property for the purposes of soliciting and securing license, royalties, partnerships, investors, and/or outright sale of the intellectual property.  Usually, these kinds of relationships require significant preparation, proper intellectual valuation, appropriate legal representation, and other important and necessary levels of interaction to finalize suitable agreements.  In these kinds of intellectual property undertakings it is often advisable to consider employing appropriate third party resources.

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