By Marianne R. Timm-Schreiber and Dana P. Jozefczyk

The idea of getting a patent can seem glamorous. However, the costs associated with a patent can be gory.

The price tag for filing a patent application can run $8,000 – $15,000. And that’s just to file the application.

Then you may have to deal with the U.S. Patent and Trademark Office to get the patent granted, which can take years. (It remains to be seen whether passage of the America Invents Act last week will speed up the patent process.) This can add another $4,000 – $15,000. Unless, of course, you give up and abandon the application.

Then there are potential costs associated with suing or being sued for patent infringement. Patent litigation can easily cost upwards of $1 million.

With that in mind, there are three things to consider before filing an application:

  • Do you intend to implement this technology as a core of your business?
  • Do you anticipate an ability to license a patent on this technology?
  • Do you anticipate a possibility to sell the patent on this technology?

If the answer to any of those questions is “yes,” you should consider applying for a patent.

In any case, before applying for a patent, consult your patent attorney. You may want to pursue other forms of less expensive intellectual property protection such as trademarks, copyrights and trade secrets.

IP Rights

Once an invention has been sold, offered for sale, published or otherwise publicly disclosed, you have one year to file for a U.S. patent before losing patent rights.

If you think you might want to patent your invention, you should file a patent application before you sell, offer to sell or disclose that technology. If you’re unsure whether an activity counts as a sale, offer for sale or public disclosure, consider the following:

  • Experimental uses of prototypes will probably not be considered a sale or offer for sale, but can count as a public disclosure if done in public.
  • The sale or offer to sell does not need to be by you. If someone else sells or offers to sell your technology more than a year before you apply for a patent, you may lose your patent rights.
  • Listing an invention as a product on a website has been interpreted to be an implicit offer for sale.
  • Disclosing your invention to anyone who is not subject to a confidentiality agreement, such as a friend, co-worker or neighbor can be considered public disclosure.
  • Public disclosures include publications, tradeshows, bids, presentations, etc.

If you think you may have sold, offered for sale, published or otherwise publicly disclosed your idea, make sure you file a patent application within a year of the first disclosure.

Your Inner Circle

Your communications with your employees, independent contractors and manufacturers may constitute public disclosure.

A simple contract including a confidentiality clause can prevent communications with these individuals from counting as a public disclosure.

Moreover, to prevent having to share ownership of your invention with your employees, independent contractors and manufacturers, make sure your contracts with these individuals include an intellectual property clause that covers IP ownership.

Under U.S. patent law, anyone who contributes to a portion of the invention covered by the patent must be named as an inventor, which automatically gives them co-ownership of the entire patent.

The contribution must add to the inventive process and may not merely be a development of the invention that could have been performed by any engineer or manufacturer in that industry.

For example, if your manufacturer, acting independently of your direction, tweaks the design of your invention increasing its efficiency, and this change is covered by your patent, the manufacturer must be listed as an inventor.

If the manufacturer merely makes a change based on your direction, then the manufacturer would not qualify as an inventor.

A confidentiality and intellectual property clause can be added in a few paragraphs to any contract. These clauses should be standard in every contract you execute.

It’s best to have an IP attorney draft these agreements, or at the very least review a proposed agreement before execution. Every business and employment relationship is different. Intellectual property agreements that work for larger companies might not be right for smaller companies.

Paper Trail

It pays to keep detailed records of the development of your invention. One of the biggest hurdles to obtaining a patent is proving that your invention is not obvious over the prior art.

Prior art is any publication, article, journal, patent or speech that is publicly available and pre-dates the filing of your patent.

An invention is considered obvious if a person of skill in the same industry as your invention could combine his or her standard knowledge with the prior art to come up with your invention.

Patent examiners often interpret this rule liberally.

However, showing you encountered unexpected results and/or problems that you had to overcome during the development of your invention is considered solid evidence in proving that your invention is not obvious.

Accordingly, you should document any change or tweak you make during the development of your invention. These events, no matter how small, may be enough to obtain a patent over the prior art.

Moreover, keep track of any prior art that you find during the development of your invention. Provide these documents to your patent attorney. If a court determines that you did not disclose a material reference of which you were aware to the USPTO, your patent becomes invalid.

And an invalid patent isn’t worth the paper it’s printed on.

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Marianne R. Timm-Schreiber and Dana P. Jozefczyk are both intellectual property attorneys with Merchant & Gould in Denver. They can be reached at 303.357.1670 or via email at [email protected]