With the rise in recent patenting trends it is evident that the number of inventions is ever rising and inventors are more motivated towards filing for patents. It is now fully known that patent is not merely a tool for protecting intellectual property but is also a treasure for making millions. It won’t be wrong if we call patents as white gold of modern era.
However, analogous to fluctuating value of metallic gold, monetary value of patent may also get unfairly valuated if not taken care of during ideation and patent/product cycle.
Below are discussed some of the frequently made mistakes that may demonetize the actual value of your invention or patent.
1. Not evaluating the novelty of the invention/idea before starting work on a prototype: Novelty identification is the most important step before starting any full-fledged work on any invention or prototype. As the time and effort is precious, one will tend to lose significant amount of these in case at a later stage it is found the invention/idea is not novel. Also, any monetary expenses spent during patenting process may also get wasted if one doesn’t identify the invention’s novelty during the initiation itself. Accordingly, it’s a must that novelty evaluation be conducted prior to starting the work on the invention and prototype.
2. Not taking a prior right or filing an earliest provisional application before starting work on the invention/prototype: Just having a novel idea of an invention won’t help unless the rightful owner claims the exclusive right over it before someone else does. All effort, time and money may get wasted if one does not file a patent application (atleast a provisional one) to get a prior right over the invention. Provisional application is the best way of claiming exclusive right over an idea/invention as it provides earliest prior right; and a 1 year of grace period, for filing a non-provisional final application, in which one may also work for finalizing the invention.
3. No research for the target market where one wants to apply for patent: Patent is an expensive investment that demands many types of monetary inputs during patent prosecution and even after the grant of patent such as maintenance fee etc. Since patent provides an exclusive right only in the country where one applies for patent, it becomes of utmost importance that one chooses the countries smartly for patent filing. After all the motive behind taking a patent is monetary gains, either by licensing (or selling) it out or self manufacturing a product based on the invention; it is a smart move to understand and identify the target market where one would want to sell products based on the invention. Accordingly, a market research is recommended especially for individual inventors or SMEs that have strict budget.
4. Not executing a confidentiality disclosure agreement while disclosing the invention before having taken a prior right: Executing a CDA (confidentiality disclosure agreement) nowadays is a standard practice among law firms and patent practitioners. However, some first-time inventors miss to have it executed before disclosing their inventions/ideas to some third party. It is risky and may cost someone hugely to the point of losing exclusive rights over the invention and their intellectual property. It is therefore highly recommended to have a CDA executed with every party whom the invention/idea is being disclosed to. Also, it is a good practice to take early as possible prior right over the invention by earliest filing of provisional (or non-provisional) applications before disclosing it to someone else.
5. Drafting patent claims too narrow to ensure patent grant: Claims are the essence of any patent as claims describe the scope of the invention. Owner gets exclusive right for the invention only on the basis of what has been described in the claims. It is very important that claims must be drafted properly. Claims must not be too narrow that the patent only covers the owner’s intended product and loses its commercial ability to be licensed (or sold) out; and neither should claims be too broad so that many office actions need to be handled during prosecution as each office action response is associated with some fee. Accordingly, it is recommended not to narrow down the claims too much just to ensure patent grant, especially for individual inventors or SMEs since they lack funds to manufacture products on their own and maintain a patent that has low licensing-out ability. Though, there are exceptions to this point as well, where many corporates just want to have their intended product protected within the scope of a patent and want to add numbers to their patent portfolio.
6. Not evaluating Freedom-to-Operate while launching the product after grant of patent: Grant of patent doesn’t ensure freedom-to-operate on all components (or steps) of an invention. A freedom-to-operate study is a must to identify threatening or potentially threatening patents owned by other parties that may threaten the product even after grant of patent for the invention, especially for incremental inventions. A missed similar patent may cost millions for payment as damage by the infringing party.
7. Not keeping an eye on competition in the same domain of the invention: After the grant of the patent it is important to identify if anyone else has also applied for patent for a similar invention. For this, regular patent watch in technology domain is recommended in order to identify and oppose any patent application that has been applied by someone else; as it might happen that the examiner may miss your already existing granted patent in his/her examination. Also, filing opposition during prosecution of competitor’s patent application is much cheaper than that done after the grant of the patent, so a regular watch of newly published applications in same technology domain is recommended. This helps a lot in saving your existing market share.
8. Letting your patent lapse without conducting an infringement search to identify potential infringers: Many a times, it is seen that after the grant of their patent and renewing it for a couple of maintenance fee cycle, the patent owners move and let the existing patent lapse. It is highly recommended to conduct an infringement study to identify potential infringers that may be present in the market who are not paying royalty or licencing fee to the actual patent owner. Once the technology or patent gets older like more than 13 years, the chances of other players selling or manufacturing products in similar technology get high. Accordingly, to squeeze out maximum profit from the dying patent, an infringement study is highly recommended.
Patents or other intellectual property rights are hard earned assets and it is of utmost importance that returns must be optimized from these before letting them lapse or die. Since you never know when a market governing idea will strike you again, it’s better to squeeze most out of the existing inventions and patents. Summarizing, above mentioned pointers must be dealt with carefully while holding an asset such as a patent. After all nobody likes owning non-performing assets!!