It is possible to money from your unused patent rights
For corporations and entrepreneurs seeking to monetize their un- or under-utilized patent rights for the first time, it can be difficult to know where to begin. The patent monetization market is not yet mature and, as with other emerging marketplaces, no established methodologies and few experts exist to guide patent owners through the process. Today, there are as many as 17 different business models used to monetize patent rights. More will likely spring up as the market continues to evolve, even while some of the current models will certainly fall away. With such a range of options, it is not surprising that those seeking to sell their patent rights may be confused about what path to take.
This blog post is intended to provide an overview of ways that a corporate and individual patent owners can most effectively monetize their patent rights in today’s market. The models discussed in this article were chosen because they are currently the most common. Significantly, due to the great variability in patents and the individual needs of patent owners, the best model for a particular patent owner might actually one that is not discussed here. Nonetheless, it is hoped that after reading this, a corporation or entrepreneur seeking to sell their patent rights for the first time will be better able to understand and execute on the opportunities and challenges present today in the patent monetization market.
Thinking of Selling a Patent Directly to a Corporation Without an Intermediary? Forget About It
Most patent owners assume that it is possible to sell a patent directly to a company that might play or seek to play in the product or technology space covered by the patent. This is rarely the case, however. Continue reading
Beware of focusing only on cutting strategies when obtaining patents
Commentators like me frequently rail against what we view as the often unnecessarily high cost of obtaining patent protection. In truth, many patents are overpriced and provide questionable business value to their clients. Over-priced patents do not form the basis of this article, however. Instead, this is about the opposite phenomenon, i.e., under-priced patents. Specifically, in this article, I describe a company’s desire to obtain low cost patents and what such a patent strategy may reveal about its long term viability.
I was recently contacted by a large printer manufacturer (“PrinterCo” for the purposes of this discussion) to see whether I was interested in preparing patent applications for the price of $1300 each. This price seemed somewhat ridiculous to me because even the most “bargain basement” patent preparation prices that pop up on my Google sidebar advertising do not seem to dip beneath a threshold level of $2800. And, as a high level chemical patent prosecution attorney, I routinely drafted patent applications that cost $15K or more in 2005. PrinterCo’s desire to obtain patent applications for $1300 thus both surprised and intrigued me, and I wanted to learn more about what type of patent application its management sought for this price.
That PrinterCo was seeking to obtain patent drafting services at a lower price than I would expect might be explainable because many IP strategy savvy companies seek to maximize their freedom to operate by filing patent applications that they never intend to see through to issuance. This “publish and abandon” approach can effectively prevent others from obtaining patent rights that can block a company like PrinterCo from freely developing products in a particular technology area. However, because these patent applications are not drafted with the intent to issue, the filing company will not end up with enforceable rights. Nonetheless, “freedom to operate” afforded by publishing and abandoning applications addressing a relevant technology can serve as a valuable right in itself. It thus made sense to me that PrinterCo might seek to file a large number of patent applications to strategically prevent other companies from patenting in its technology space. Continue reading
Traditional patent file management is incredibly inefficient
For many years, vendors of office automation systems expended considerable effort trying to convince corporate and law firm patent attorneys to adopt paperless file management systems by touting the time and money savings associated with electronic files over the traditional patent file system. However, relatively few patent attorneys have done so, instead, remaining loyal to the traditional three-sided manila patent file folder. Until recently I was one of those patent attorneys. Now that I have discovered the vast efficiencies and improvements possible with these electronic systems, the question is why I remained true to this clearly outdated system of maintaining client patent prosecution records.
Given the remarkable efficiency and knowledge management improvements possible with electronic patent file management systems, there can be no viable excuse for either corporate or law firm patent attorneys not to adopt such systems.In retrospect, I think I found that the heft and history represented by the partially filled patent file folder provided a feeling of ongoing accomplishment, even while I was contesting yet another trivial rejection from a patent examiner. The need for a tangible sign of my efforts prevailed over the backaches that I incurred from carrying multiple patent files to work on outside of the office. However, after being faced head-on with the administrative inefficiencies of the traditional paper-based patent file management systems, I am now a convert to the undeniable benefits of electronic patent file systems.
Put simply, given the remarkable efficiency and knowledge management improvements possible with electronic patent file management systems, there can be no viable excuse for either corporate or law firm patent attorneys not to adopt such systems. When viewed in the best light, patent attorneys who decline to adopt an electronic system are doing their clients and themselves a disservice. Viewed in the harshest light, these attorneys are unintentionally cheating their clients out of innovative methods that improve the quality of patent legal service while reducing its cost. Continue reading