Invention Help

Category: Patenting

  • Patent Licensing: How To Monetize Your Ideas

    Patent Licensing: How To Monetize Your Ideas

    patent-licensingIn this article we provide a brief discussion of patent licensing as an attractive way for inventors to monetize their patents.

    You have created a new invention and you have spent a lot time and a considerable amount money obtaining a patent for it. What’s next?

    Well, you probably want to be rewarded for the many hours you spent developing your invention, and you would most likely want to recoup the thousands of dollars you spent obtaining the patent.

    The solution then is to monetize or make money from your patent and the underlying invention.

    Monetizing Your Patent

    There are three basic ways you can monetize your patent:

    1. By entering into some entrepreneurial venture involving your invention. For example, you may manufacture and market your invention, or employ it in some service related business.
    2. By assigning or selling your patent and underlying invention to a third party for a financial gain.
    3. By collecting royalties from patent licensing.

    The decision ultimately depend on how you want to make money. For those who are business-minded, the first option may be the most appealing. With this option the potential financial rewards are greater, but so too are the risks.

    For others, however, the second and third options may be the easiest and most economical routes to monetizing their patent. With these two options, someone else assumes all of the business risk, while you, the inventor, get paid comfortably just for being an inventor. The rest of this article will focus on the last of these options, patent licensing.

    Patent Licensing

    Besides a patent holders ability to exclusively manufacture and offer for sale his invention, the most common way to monetize a patent is through patent licensing.

    A patent license is an agreement in which the patent holder, called a “licensor“, grants to a third party, a “licensee“, the right to commercially exploit a patent and the underlying invention. A patent license establishes the conditions under which a licensee may exploit the patent and the obligations with which the licensee must comply. Like other contracts, a breach of the obligations set forth in a patent license may result in the termination of the agreement and the return of the exploitable rights to the licensor. Thus, a patent license is revocable. This is in contrast to the second option above, where the patent holder sells or assigns his exploitation rights irrevocably.

    In return for granting the patent license, the licensor receives a series of payments over a specified period of time, usually the life of the licensing agreement. These payments are called “royalties”. A licensee’s failure to pay royalties would be considered a breach of obligations and will usually result in the termination of the license agreement. If this occurs, the licensee loses his right to exploit the patent and the licensor may choose to license the rights to someone else. This acts as an excellent deterrent against the breach of royalty obligations and makes licensing particular attractive to patent holders.

    Advantages of Patent Licensing

    Some of the other advantages of patent licensing include:

    – Low cost. Typically the only costs incurred when licensing a patent is for presenting and marketing to potential licensees and negotiating deal.

    – Transference of risk. The licensee assumes all of the business risk.

    – Freedom. An inventor is free to pursue other ideas while still profiting from his invention.

    Disadvantages of Patent Licensing

    A couple of the perceived disadvantages of patent licensing are as follows:

    – Low rate of return. Royalties typically range from 2% to 10% of the net revenues. Compared to the potential rewards from entrepreneurial endeavors, this may seem miniscule.

    – Risk of bad deals: A bad licensing deal can tie up your patent for an extended period of time and may result in expensive legal battles over royalties.

    That being said, the route you take to monetize your patent should depend on your personal desires, resources and know-how. If you are simply an inventor and do not possess the the means to finance an entrepreneurial endeavor or the business acumen to make it succeed; or you simply wish to receive an income stream from the exploitation of your patent, without bearing any of the business risks, patent licensing may be your best option.

  • Patent Invention Basics

    Patent Invention Basics

    patent inventionIn this article we are going to talk about the patent invention basics to get you started in the invention patenting process.

    Inventors do a lot of hard work to come up with great ideas and ultimately inventions to improve everyone’s quality of life.

    To stimulate that process and provide economic incentives for people to develop valuable inventions, the US and most Western governments provide legal protection for inventions for a limited period of time, if an inventor establishes their invention is novel and useful.

    What A Patent Is For

    A patent provides 20 years of exclusive ownership rights over new inventions that meet the standards provided for review. Patented inventions must be found useful by USPTO standards.

    One purpose of patent protection is to stimulate creativity and reward investment in new ideas and their applications.

    What Is A Patent Not For

    The patent invention process falls under certain limits and categories. Patents do not cover arrangements of words, which are covered under copyright or brand-related images, which are covered under trademarks. They also do not protect any invention that is not original or closely that resembles what is already known in the field. There are also things present in the world that are considered ideas or considered “natural” like dirt, literally. These things are not patentable.

    Who Makes A Patent Invention Official?

    The United States Patent and Trademark Office (USPTO) makes a patent invention official. The process of assessing whether an invention is patentable is called patent prosecution. It requires submission of paperwork to support the invention and show that the invention is original and not obvious to professionals in the field.

    When the patent invention process is complete if it is successful a patent is issued and the invention receives a patent registration number. The USPTO offers a lot of information about how to patent at its website www.uspto.gov.

    The Three Types of Patents

    A patent invention may fall under the following categories:

    Utility Patents

    Protects machines, methods/processes, compositions (which include modified genes) and variations thereof.

    Design Patents

    Protect the outward appearance of an item, how it looks. Furniture and highly useful common items often receive design patents, like a special hook to hang a coat on that has an unusual shape.

    Plant Patents

    Protect plants (the green things that grown in your house and in the woods). It is a highly specialized area and if this is the type of patent you are interested in you are probably not patenting the plant on your own.

    A Novel Patent Invention

    If an inventor has a great idea, the most important thing to establish is whether the idea is patentable. Patentability affects the value of the invention in the marketplace and knowing whether it is patentable enables an inventor to make decisions about how to sell or market the invention.

    A basic patent search can be performed on Google, at the patent search office, and many other free services.

    If the inventor searches and finds nothing then it is worth investing to have a professional searcher look and see what they can find. Professional searchers will perform that function for a few hundred dollars and can save an inventor from making a substantial investment they would not otherwise make.

    If the inventor searches and does find something that sounds like his or her invention, they may want to look further into what the patent covers to determine if it includes the same invention that he or she wants to patent.

    The Traditional, Full Patent Invention Application

    This requires quite a bit of money, often thousands of dollars or more. The typical patent for an invention also takes more than a year and up to several years to be approved, so getting a patent is a commitment.

    The Provisional Patent

    The provisional patent is basic paperwork that describes the invention and gives the filer a year to “get going” on the full patent application. It costs a few hundred dollars to file so many inventors start here. It is important not to let the term expire without making a decision about whether to follow through with the patent.

    Hire a Professional

    For most serious endeavors to develop an invention it is worth hiring a patent agent or patent attorney to work with the invention and prepare the application materials. The USPTO will likely require changes to the patent and have questions throughout the process, and it is helpful to have someone to respond who is knowledgeable.

    While there are fees, there is little purpose in going through the process of applying for a patent and then not receiving one because the application was not completed or followed through with sufficiently.

    A patent is only as valuable as the invention that it protects, so it is important to evaluate whether the invention warrants the financial investment. The process of receiving a patent invention is quite a bit of work, but one that many inventors have found to be worthwhile.

  • Patenting An Idea

    Patenting An Idea

    patenting an ideaPatenting an idea is not necessary as straightforward as it seems, but it is also not overly complex. Inventors often talk about their great idea and how they have to get patent protection for it.

    There is only one problem. It is not possible to simply go about patenting an idea!

    Ideas are free and unprotectable in the US, unless you just keep the idea to yourself. Patent law protection applies to inventions or methods that are protected because they are applications of ideas. So, first you have to get to the point where you have something to patent.

    Patenting an idea requires the inventor to have an invention, a method, a machine or an object you made that is concrete.

    In addition, the invention has to be new, not obvious, and useful by government standards. If an invention meets these criteria, and a few others it can be protected by patent law.

    First invent something with your great idea

    Make something with your great idea if you really want to patent something. But you can’t patent everything. Actually, you can’t patent most things, and the vast majority of businesses rely on things that cannot be patented. Patenting requires two parts, novelty and lack of obviousness.

    Novelty

    Patenting an idea requires novelty. Nobody can have it already. It’s not just that no one can have patented it before, it actually has to be considered new. It cannot be in the literature and it cannot be sitting on someone’s desk in their pencil drawer unless it is you the inventor or one of the people who works with you.

    Non-Obviousness

    Even if it is novel, a little more is required. If it is something that people who know the industry would think, yeah, we should do that, it is so obvious, it still cannot be patented. So if you have seen red bottle tops but nobody made green ones, and everyone in the industry knows about the color green and paint and dye, most people would think the green is obvious. So there is no invention to protect with green bottle tops even if it is novel.

    Patenting an Idea Types

    If you want patent protection for your invention, it comes in three options:

    Design Patent

    Patenting an idea in the form of a design protects the appearance of an item. This can be the new bread basket that has a subtle sloping back that is ergonomic in your hand and made of regular wood. A lot of artistic design fits this arena.

    Utility Patent

    A utility protects the constructed item itself, including the mechanics or electronics. This could be the new chair with a completely different base than has ever been seen, balanced on a gyroscope of some kind that defies gravity. Other examples- computers, artificially constructed cells in biotechnology. There are four types of utility patents:

    Machines

    Mechanisms, mechanical, electrical or otherwise, that do things. Example, computers, but also simple example: pulleys.

    Methods

    ways of doing things, example: a way of dispensing a drug

    Article of Manufacture 

    things you make out of known materials—like a hammer.

    Composition of matter 

    Whenever you mix something together and get something new – that is composition of matter. It does not have to be stable or long lasting.

    Plant Patents

    While there is a special group of patents for people interested in plants, it is a much smaller group of people. So it gets a brief mention.

    Generally, the patenting an idea process is more selective and specific than many inventors think. It is not for every great idea out there that gets turned into a great invention. If an invention meets the criteria, however, it can make your invention more valuable because of the exclusive rights the invention and anyone license or sell an invention to would have for twenty years after you patent your invention. So every inventor with a great invention should look into patent protection to determine if it will work for them.

  • How To Register An Invention

    How To Register An Invention

    how to register an inventionIn this article we will explore the often asked question of how to register an invention.

    There are two different approaches that inventors can take to registering their invention.The first is to do it yourself; the second is to employ a professional patent attorney to do this on your behalf.

    How To Register An Invention Yourself

    If you are going to do your own patent there are a few simple steps to follow. Hire other people to do the small things that take expertise. You can probably fill out the basic provisional application paperwork yourself. There are basic directions at the USPTO website. In addition, the USPTO will put you in touch with staff that can give you basic, general advice that is not specific to your invention.

    A first cut basic patent search: This you can do yourself

    It is not recommended that inventors who do not have patent experience rely on their own patent searches because searches can be more difficult than people think. A “first cut” search may find a patent for what you “invented”, though, and can save you from paying a professional to find what you could find yourself.

    There are several patent search databases available, including one at the USPTO website and one at the Google Patent website.

    A Second Search By A Professional

    If the inventor as patent searcher does not find the patent, or has difficulty in doing so, the next step is to hire a professional patent searcher or patent attorney to do a search for you. If the goal is to keep costs down and the invention is not overly complex, a patent searcher can look for the invention. A patent searcher or someone should also look for prior art, which includes any journal articles or related materials in the public domain that may not be patentable. If there is prior art on your invention even if there is no patent it is probably not patentable.

    If the searcher does not find your invention, you can then go on to the next steps, which include writing the patent, producing drawings that show the patent, and filing the patent. If you are wanting to know how to register an invention quicker than this, unfortunately the process itself will be out of your control once you have made the application.

    How To Register An Invention Using An Attorney

    Complex Patents

    If you have a complex patent you may want a patent attorney or patent agent to guide you through the entire process. They can fill out the paperwork to file with the United States Patent and Trademark Office (USPTO). Only a patent attorney can appear before the Patent Courts for many of the proceedings. Patent agents generally do not have experience with licensing, so if either is necessary, a patent attorney may be necessary. Patent agents can do all of the necessary work related to filing a patent unless the patent is challenged, which may make the case more complicated.

    The paperwork should contain line by line descriptions of the invention that “teach” what the patent is. There should be somewhat similar patents available to learn some of the language use. The patent should also be supported by schematics, drawings of the invention that show it from different angles. The paperwork is probably the most difficult part of the patenting process and it is the point where many patents get derailed.

    A Brief Note About The Patent Examination Process

    Either you the inventor or the patent attorney or patent agent will go through the examination process where the patent is reviewed in detail. The USPTO will have contact with the individual handling the patent and amendments to the paperwork are often necessary. This usually takes many months up to a year or more depending on the type of patent and backlog at the USTPO.

    For those wanting to know how to register an invention in the UK, Europe, Australia and in other places

    The process discussed above will apply to most Western countries, except that each country will have their own independent patent office. Do a search online to find the patent office related to your country or the country where you are wanting to register the invention in.

  • What Inventor Assistance Is Available

    What Inventor Assistance Is Available

    inventor assistanceThere are a lot of websites out there offering basic inventor assistance regarding patenting and other types of advice regarding your inventions. Some are certainly helpful at getting started and perhaps providing some introductory information as to patentability and other alternatives an inventor might pursue to protect an invention.

    Consult a professional about whether your invention may have commercial value, and get inventor assistance and help with whether or not to patent and how to patent your invention.

    Non-Profits Companies Providing Inventor Assistance

    Benefit: There are a few nonprofit organizations that can help an inventor determine if they should spend the money and energy developing an idea. One is the Inventor’s Assistance League, Inc. Such organizations have been generally found to be helpful and a key benefit to discussing an invention with them and other professionals who advise about the value of inventions is the focus on marketing and the business end, which many inventors do not have.

    Possible Downsides: No interest in the commercial investment can limit interest in developing the product and not all of the contacts at organizations like these have a lot of business experience.

    Professionals That Help Develop Inventions and Products

    Benefit: There are businesses that specialize in product development and prototype development. Some of these provide helpful inventor assistance so long as you have a good contract in place to protect your invention when you deal with them. They are a business and they have commercial priorities, so if they think the product can sell they will often be willing to work with you.

    Possible Downsides: These businesses have areas that they specialize in, and if your invention isn’t “their kind of thing” their interest and feedback may be of limited value.

    Using The USPTO For Inventor Assistance

    If you know you want to patent something up front, the USPTO provides some very general assistant to inventors. They have an inventors’ assistance section that is on the USPTO website. Keep in mind that the information they are willing to provide is very general and is targeted at the process of getting an invention, not an individual’s specific invention. The staff at the USPTO cannot give advice as to a specific invention and they cannot give legal advice.

    Consulting Outside Sources Gives Additional Information and A Different Approach

    Consulting with a professional, either from a non-profit of the private sector has value on at least two fronts:

    1. The inventor gets feedback from a party that is not invested in the invention’s success.
    2. The inventor gets feedback from a party that knows about the marketplace and what sells.

    Keep In Mind: Professionals are not always right

    No matter who you talk to, there are literally thousands of inventions and products that everyone thought would fail except the handful of people who got it on the market. While most inventions have no commercial value, some do. If you see it but others don’t you should not give up on your invention.