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 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 →

Why the IP Law Firm Business Model is Broken And What I Am Doing About It

As a former IP law firm shareholder and senior corporate lawyer, I know all too well the expense required to start and maintain an IP law practice.  Not only are IP lawyers of all levels of experience paid handsomely, but so are the highly skilled paralegals, docket clerks and administrative professionals traditionally required create the infrastructure needed to handle the myriad of details involved in an IP law practice.  Of course, this expensive infrastructure must be sustaining, so while a lawyer serves today’s clients, her eye must also be on finding the next client because payroll and rent obligations don’t take a holiday when clients do. This “feed the beast” nature of the IP law practice model was a primary reason that I decided several years ago that I would not again work in the traditional practice of law.  How could I?  The standard legal service framework required me to build and maintain a business model where the product offered is obtaining patents for clients.  However, over the years I discovered that often the client does not need the very product that sustains the IP law firm business model.  What I perceived as an inherent conflict between my business interests Continue Reading →

False Marking Lawsuits are Real Problem for Business and Make Little Sense When Applied to Expired Patents

The threat of false marking lawsuits has garnered much attention in the IP business press in the last couple of years.  Companies of all sizes have been hit with qui tam actions (that is, suits brought by an individual or company on behalf of the US government to right wrongs done to the government, not the individual) where the basis of the action is the mis-marking of a product with an incorrect or expired patent number.  Like a gold rush, these lawsuits have resulted in a number of legal entrepreneurs seeking out products that are incorrectly marked–usually by identification of expired patents, which is an easy thing to find–and their bringing suit against the offending companies.  Indeed, there were over 500 false marking lawsuits filed in 2010, making this cause of action seem almost like a way for un- or under-employed patent lawyers to generate income after the rash of layoffs and firm closings in the last few years. For patent lawyers representing corporations, false marking cases may seem like a pain for clients, but something which nonetheless leads to business if a suit is brought against his client.  But, in reality, the uncertainty raised by the current rash of Continue Reading →

How the Northeastern Indiana Amish Serve as a Business Lesson about Patents

I have been spending time in Northeastern Indiana–the land of my roots–to introduce my children to their aunts, uncles and many, many cousins.  Catching up with extended family has made it difficult to formulate a post in the past couple of weeks, but I have a few moments this morning and wanted to capture a thought that has been rattling around in my head since I arrived here. Anyone who has spent time in this part of the U.S. will be familiar with the presence of the Amish as part of the cultural landscape.  My children, as city kids, are fascinated whenever they see a carriage with families traveling along the side of the roads.  However, I invariably consider about how stifling I would find it to not be able to interact with the outside world in the way that is familiar to me.  In short, I wonder what it would be like not to be able to be part of the modern world and immediately subtract all of this from my “happiness quotient”, which is the same view I have held of the Amish lifestyle since I was a child. Earlier this week, I was sitting with my uncle, Continue Reading →

Have a Pending US Patent Application? There’s Never Been a Better Time to Make a Deal with the Patent Office

The US Patent Office is in a deal-making mood.  Really.  Ever since Director Kappos told his examiners last Fall that “patent quality does not equal rejection,” I have heard many stories about how patent applications that appeared to be stuck in the limbo 0f serial rejections are now being allowed.  Those of us who talk about such things online are in agreement that we may be operating in an unprecedented favorable environment of patent allowances.   The data bear out this anecdotal evidence:  patent issuances are up 35%  this year over last year. My sense of what is happening, which has been confirmed by other experienced patent folks to whom I have spoken, the perspective of the Patent Office has changed.  The consensus is the U.S. patenting process is much less adversarial today.  In recent years, examiners were effectively told by the Patent Office administration that “there needs to be a reason to allow an application.”  This has now changed to “there needs to be a reason not to allow an application.”  This is a subtle, but critical, difference.  In the former viewpoint, the gate for allowance is closed and needs to be opened prior to letting the applicant pass through.  Continue Reading →

Much Ado About Patent Marking: Why It is So Hard for Corporations to Get It Right and Why False Marking Lawsuits Might be a Good Thing Overall

It is fairly rare for patents to make hit the radar screen of mainstream news outlets but, recently, there has been much space allotted to the issue of patent mis-marking and lawsuits being brought by third parties for “violation” of the law requiring that products cannot be marked with an incorrect patent number.  Indeed, the usually substance-free local paper in my mother’s Southwest Florida community reported about the flood of patent mis-marking lawsuits.  And, it is no wonder that the undoubtedly arcane issue of patent marking has reached the status of “news” in a small-town paper given the huge number of cases currently pending in the federal courts.  It seems as if patent marking litigation may be the new business model for trial lawyers who are looking for a new “gravy train” to extract substantial legal fees from corporations whose activities violate the letter (but not necessarily the spirit) of the law. First, an explanation:  U.S. patent law expressly dictates that products should be marked with the number of patent(s) with claims that cover that same product.  If one does not mark the product, the patentee cannot obtain damages for infringement that occurs either prior to its giving “actual notice” Continue Reading →

Corporate IP Managers: There are Bargains Galore Available at Some of the Most Prestigious Law Firms

With corporate legal budgets being cut more than 10% in 2009 it might seem like challenging times to manage a corporate IP department. To add to the difficulties, such reductions are occurring even while many corporations are increasing the focus placed on creation of value using strategic IP management. Corporate IP managers must therefore obtain more valuable IP with smaller budgets. Fortunately for corporate IP managers, the current economic climate has forced many prestigious law firms to, perhaps for the first time, develop innovative billing and practice models. This has not only resulted in the effective billable rates of these law firms effectively dropping more than 10%, but many law firms have or are developing more efficient ways to deliver legal services to their clients. Smart law firms will pass these cost savings on to their clients to build loyalty. Tweet This Buzz This Delicious Digg This Reddit Stumble This

Improve Your Chances of Obtaining a Patent at a Reasonable Cost and Time by Demonstrating the “Wow Factor” in the Application

A strong majority of people seeking patent protection to protect their products or technology leave the details the drafting process to their patent attorneys. That is, given the specialized (and, frankly, arcane) nature of the patenting process, even highly accomplished business professionals believe that a patent specialist (i.e., attorney or agent) is better equipped to understand how to best describe their invention to the US Patent Office (“USPTO”). This can be an ineffective way to handle the front end of the patenting process because it can result in the process being more contentious. Such contentiousness can result in narrower claims than desired and can make the patent take longer to issue and make the process considerably more expensive. In determining whether a client’s invention meets the legal requirements for patentability, a patent specialist thinks about how to legally distinguish the invention from those that have come before. Specifically, the patent specialist must demonstrate to the USPTO—as represented In the person of a patent examiner—how the invention is new and not obvious in view of what others have done previously. The patent specialist must also determine how to describe the invention in a way that satisfies the precise technical and legal Continue Reading →

The "Dirty Little Secret of Patents" is that Most are Worthless to Their Owners. Here is Why.

Notwithstanding the vast corporate and entrepreneurial resources expended each year to file, prosecute, manage and maintain patents, a significant majority end up having little or no business value to their owners. Patents can end up being worthless for any number of reasons, most of which center on the fact that the claims do not cover a product or technology either currently or in the future being made, used or sold by either the owner or a third party. And, when a patent does not cover a current or future product or technology, one might argue its only residual value is as the attractive government document on the right. No doubt exceptions exist to my bold assertion that most patents end up as worthless to their owners. That is why I used the qualifier “most” in my statement. (And, if the reader is a patent owner, I certainly am not referring to your patents because, like the children of Lake Wobegon, all of your patents are above average.) Whether or not you agree with my opinion, or whether you think that only “many” or even “some” patents are worthless, with the resources committed to obtaining patent rights and the expectations placed Continue Reading →