Who Needs a Patent?

My response to the question posed in the title of this post is typically: “the only person who needs a patent is a patent attorney.” Indeed, if a patent attorney fails to convince clients like you that they need to obtain a patent, she will quickly lose her livelihood. You should therefore be skeptical if a patent attorney recommends that you move forward with a patent without also advising you to first fully evaluate your business model, your go-to-market strategy and the competitive landscape and determining along with you how the available patent protection may allow you to realize your company’s revenue and exit goals. This is not to say that patents are never the right thing or even often the right thing for entrepreneurs. To the contrary, examples abound for companies where patents served as a primary means of value creation. Studies nonetheless show that only a small percentage of patents become valuable business assets, even when the filers are sophisticated companies with large patent portfolios that retain expert internal staffs to manage their IP strategies. This reveals that most companies miss the mark when it comes to protecting their innovations using patents. Moreover, early stage companies pay 3 times or more for patents than Continue Reading →

Strategic Patenting: How To Get it Right (Guest Post)

This article, by Francis Hagel, first appeared in Intellectual Property Magazine. It provides strong guidance, in checklist form, for those seeking to beat the odds that the patents they obtain will actually generate strategic value. Mr. Hagel is an IP strategy advisor from France. The article is reproduced with permission. “Suggestions for strategic drafting of patent applications” In the drafting of a patent application, a practitioner starts from a blank page[i]. He/she enjoys the greatest freedom for shaping its content on the basis of the information at hand concerning the invention, its context and the prior art of interest, within the constraints set forth by patent law in the country of filing, keeping in mind the specifics of patent law in the major markets for the invention. This freedom applies to all parts of the application : definition of the technical field, description of the prior art, statement of purposes, description of embodiments and results, claims. There are thus myriad decisions to be made.  Based on the understanding of the applicant’s objectives,  the practitioner can  ensure such decisions are in tune with these objectives. This is what can be called a strategic approach to the drafting of a patent application. Continue Reading →

Software Patent Apocalypse?

The data coming out of the district courts and the USPTO make it fairly apparent that the “Software Patent Apocalypse” may be here, at least for the foreseeable future. This result has been widely predicted since the US Supreme Court decided Alice Corp. Pty. Ltd. v. CLS Bank International earlier in 2014, but facts now are coming out to demonstrate that the next few years will be tough for those who seek to obtain patent protection for inventions that fall into the realm of software. We saw initial data from the district courts a couple of months ago when Timothy Lee of Vox.com presented data showing that a number of software patents had been found invalid as failing to claim patentable subject matter (a “Section 101 rejection” to us patent types) under the Alice rationale in the few months after the decision. Lee’s take: [T]he courts are sending a pretty clear message: you can’t take a commonplace human activity, do it with a computer, and call that a patentable invention. Traditionally, patents making it to district court have not usually been open to attack on subject matter grounds. It was therefore somewhat surprising that after all the time and effort spent by the parties to get Continue Reading →

Strategic Patenting 4: A Case Study of Success

The Takeaway:  In the 4th post in this Strategic Patenting Series, a case study is presented of a company that created durable market-making patent protection for a successful consumer product innovation using a disciplined patenting strategy. The strategic patenting efforts of Procter & Gamble undertook with its market-leading Swiffer Wet Jet® floor cleaning system allowed the company to create strong protection of the function of the basic product. This, in turn, resulted in protection of the underlying consumer benefits provided by this innovative floor cleaning system, a fact that allowed the company to prevent functional aspects of its system from being included in knock-off products.  Moveover, P&G leveraged its ongoing consumer insights to continue to grow its patent portfolio.  In short, the company’s successful strategic patenting efforts have “made it cheaper to go through them than around them,” thus contributing to its market leadership for this innovation for the past 15 years. The Long Story:  In a previous blog post in this multi-part Strategic Patenting Series, I explained how the vast majority of innovators fail to maximize the full scope of the value proposition of their innovations in the marketplace.  In short, the missing piece in most patenting efforts is Continue Reading →

Strategic Patenting Part 3: Why (Almost) Every Innovator Fails to Maximize Patent Value

The Take Away:  Those seeking to generate market-making patent coverage for new innovations must recognize that patent coverage should focus not on how the problem is solved but instead on the benefits provided to the customer.  Most patent coverage is directed to a specific solution to a customer need that is characterized in the form of an invention.  Patents that cover only one solution to a broad customer need will permit competitors to solve the same customer need with a non-infringing substitute product, thus leaving the patent holder with no legal recourse against their competitor.  On the other hand, market-making patent coverage focuses on the benefits provided to the customer, which means that competitors cannot sell the same benefit.  Accordingly, patent coverage that emphasizes benefits over features will make it more difficult for competitors to provide the same solution to the customer.  Innovators must heed this warning or they will end up being one of the many examples of companies that innovated to successfully solve a consumer need but that did not successfully prevent others from competing in the same market. The Long Story:  As I discussed in a previous post in this multi-part series on Strategic Patenting, those of us Continue Reading →

Strategic Patenting Part 2: It’s Not Your Patent Attorney’s Job to Get it Right

From the last post, we see that it is very rare for patents to create value for their owners.  Moreover, if the “big guys” with pockets deep enough to hire the best lawyers can get it right only 5% of the time, there should be no doubt that smaller companies and individuals should re-examine the advice they are getting from their IP counsel.  This is not to say that smaller companies and individuals cannot be successful in creating market-defining patent protection.  To the contrary, it is my strong belief that small companies can create solid patent protection at a reasonable cost, but to do so will likely require patentees to recognize that their IP counsel likely has no clue how to do what you need done.  And, even if she does, it is not her job to make you money from your patents.  Instead, her only job is to get you a patent.  Period.  End of story. Smaller organizations or individuals should not assume that that your attorney does not have your best interests in mind when doing patent work on your behalf.  Certainly, the vast majority of patent attorneys are ethical and have their client’s best interests at heart. Continue Reading →

Strategic Patenting Part 1: Why So Few Patents Create Real Value

Many business people are surprised to find out that all patents are not created equal.  A recent study of Fortune 500 companies reported in Suzanne Harrison’s Edison in the Boardroom Revisited indicates that only a very small number of patents–namely, 5%– obtained by these top patent filers created strategic value for their owners.  If only 5% of the most sophisticated companies, all of which have veritable armies of patent professionals on their teams, can get patent protection right, it must follow that less resource-rich companies have an even lower probability of gaining strategically valuable patent protection.  This and the next few blog posts will aim to help improve the odds for business people seeking to learn how to generate more valuable patents. The first issue to clear up is what “strategic patenting” means.  Those of us in the IP Strategy business define a “strategic patent” as one that is “market making.”  In other words, a “strategic patent” is one that effectively prevents a competitor not only from making the same product, but also from playing in the same market space.  When a company holds a strategic patent, the competitor must expend efforts to innovate around the incumbent patent owner, which is, at a minimum, Continue Reading →

Do Startups Need Patents? Rigorous Study Presents Real Data on Startup Company Patenting Behavior

As an IP Strategy advisor, I am often asked by the leadership of startup companies what the return on investment is from patenting.  While I can confidently provide recommendations as an expert, my opinions are anecdotal based on my almost 20 years experience as an IP professional.  Certainly, I have advised a number of startup companies over the years for which comprehensive patent coverage was critical to financial and market success.  On the other hand, I have advised a much larger number of startup companies over the years where patenting made little difference to their fortunes. The subjective nature of IP advice holds for other patent professionals.  Our respective years of experience results in tacit knowledge that becomes “expertise.”   This expertise guides clients to us for advice and allows them to trust in our counsel.   Missing from my knowledge base–as well as that of my IP attorney peers–have been data-driven assessments of whether, when and to what extent patents really matter to start up success. Similarly, startup companies are typically inundated with the advice of peers, mentors and investors about whether patenting is recommended in a particular business situation.  Such non-specialist expertise is even more fraught with subjectivity Continue Reading →

Presentation: IP and Patent Strategy for Business Value Creation–The Good, The Bad and The Ugly

While postings have not been frequent in 2013, I have nonetheless been very busy with my IP Strategy counseling and speaking engagements.  In 2014, I will commit to being much more diligent in updating my blog with relevant content for those seeking to use IP and intangible asset strategy to create and maximize business value.  In the meantime, here is the deck from IP Strategy Overview I presented at a conference of innovators at Georgia Tech’s College of Architecture in October 2013.  The summary is below the presentation.  (To view the Slideshare presentation you view the full post in IP Asset Maximizer Blog.) [slideshare id=29609113&doc=huttergoodbaduglyipstrategypresentationoctober2013-140101073032-phpapp02] This deck includes the basic overview of IP (patents, copyrights, trademarks, trade secrets).  However, this presentation goes beyond the usual lawyer-generated content to highlight not only the positive business aspects of IP, but also to give a reality check as to the likely ROI of investment in protection.  Additionally, commonly overlooked forms of intangible asset business value are highlighted.  A case study of a poorly designed and executed IP protection strategy where a significant (and arguably disruptive) innovation is highlighted. Recommendations for business relevant IP and patent protection strategies to create and maximize business value Continue Reading →

Free and Low Cost Patent Search and Analysis Tools: Who Needs Expensive Name Brand Products?

(NOTE:  At the end of this post is a detailed spreadsheet that lists the free and low cost tools that I use regularly in my IP strategy practice.  At the request of a group of IP strategy professionals with whom I network, I will be giving a presentation on these tools at a local event.  I thought that readers of this blog would also appreciate learning about how these tools can add high value at a low to minimal cost.) In private conversations, some of my corporate peers inform me that they pay $1000′s per year (or even per quarter for larger companies) for access to “name brand” patent search tools that nonetheless  do not contain accurate and up to date information.  For example, a client tells me that one of these expensive tools fails to update USPTO records on a portfolio her company is monitoring and that the PAIR data is more than 1 year out of date.  This limits the effectiveness of the expensive database by requiring her IP support staff to check each individual record on a regular basis to update the data.  Of course, this limitation defeats the purpose of spending the big bucks to engage Continue Reading →