Expand your legal knowledge with these articles written by experienced attorneys at Northwind IP Law regarding intellectual property topics such as patents, copyrights, trademarks, trade secrets, and more. If you or someone you know is looking for a lawyer to assist with protection of personal or business innovations, please contact us at Northwind IP Law today.

Stephen C. Jensen October 2015

 

Everyone knows and loves the “Happy Birthday” song:  happy birthday to you, happy birthday to you, happy birthday dear _____, happy birthday to you”.  What everyone doesn’t know is that, until recently, a company has been collecting royalties for certain uses of this song, based on a copyright claim.  A September 2015 ruling by a federal court in California has now put an end to that.

 

The U.S. copyright laws grant certain exclusive rights for original works of authorship.  And of the many types of protectable works, songs are of course one of them.  That is not surprising.  What is surprising is that someone could still own a copyright in the Happy Birthday song.

 

The California court case began in 2013, after Warner/Chappell Music, Inc. (“Warner Music”) demanded substantial licensing fees from certain artists for including the Happy Birthday song in their films or other works.  The basis of Warner Music’s claim was a 1935 copyright registration, which it acquired in the 1980s.  The artists paid the fees, but then sued to recover their money and challenge the copyright.

 

The facts of the case are too complex to lay out fully in this short article.  However, we will describe a few of the more relevant or interesting points.

 

The melody and lyrics of a song are separate copyrightable works.  The parties agreed that the melody of the Happy Birthday song was in the public domain, and not subject to Warner’s copyright registration, because a similar song called “Good Morning To All” was published much earlier.  The two songs had the same melody, but the Good Morning song lyrics were different:  good morning to you, good morning to you, good morning dear children, good morning to all.  This song was written by Mildred Hill and her sister Patty Hill in the late 1800s, and was published—and a copyright registered—in 1893.  The copyright for the Good Morning song expired in 1949 based on its 1893 publication.

 

In 1933, a play called “As Thousands Cheer” was released.  The play included a performance of the Happy Birthday song.  The Hill sisters sued the producers of for copyright infringement, based on the fact that the Happy Birthday song used the melody of the (copyrighted) Good Morning song.

 

Up until this time, there was no copyright registration for the Happy Birthday song per se, i.e., there was no registration that included both the melody and lyrics of the Happy Birthday song.  That presumably occurred two years later, in 1935.

 

Returning to the California litigation, Warner Music acknowledged the public domain status of the Good Morning song (both melody and lyrics), hence, it asserted a copyright limited to the Happy Birthday song lyrics.  The lyrics are of course recited whenever the song is sung.

 

The artists raised several arguments for why Warner Music’s copyright claim should be rejected.  One was that the authorship of the lyrics was in question.  Another was that the copyright to the Happy Birthday lyrics expired, or entered the public domain, long ago because of their publication in various books from 1911 to 1928.  Still another was that there was no proper transfer of rights to Warner Music.

 

Warner’s position was that Patty Hill was the author of the Happy Birthday lyrics.  Patty was on record, from testimony in the “As Thousands Cheer” lawsuit, that she wrote the lyrics, presumably around 1893 or earlier.  However, the artists pointed to contrary evidence, including the early 1900s publications that contained the Happy Birthday lyrics but listed other people as authors.

 

The artists also pointed to some of those publications, and the widespread use and popularity of the song for three decades before the 1935 copyright registration, as evidence that the copyright was forfeited.  The court however noted the absence of evidence that any of those publications or uses were authorized by Patty Hill.  Authorization by the copyright owner is a necessary element to showing forfeiture of a copyright by general publication, under the law then in effect.

 

Finally, the court considered the chain of title of the copyright.  Warner Music traced their copyright claim back to the Hill sisters through a series of agreements, some details of which were unclear or unknown.  The court ultimately found that the Hill sisters did not transfer their rights in the Happy Birthday lyrics as alleged by Warner Music, and granted summary judgment for the artists.

 

So if you’re planning to make a movie that includes the Happy Birthday song, you may now rest a little easier.

 

When you were young you may have asked “Who’s that?” when you first noticed the words “Pat. Pending” stamped on a product or a label.   Later, you probably learned this is short for “Patent Pending”, placed there by the manufacturer to put others on notice that the product is the subject of a pending patent application.

 

Ordinarily, the manufacturer would change the wording of the notice to “Patent  X,XXX,XXX” (or the like) after the patent application was granted or allowed by the U.S. Patent Office, where X,XXX,XXX refers to the particular number assigned to the granted patent.  Marking the product in this way with the granted patent number makes it easier for the patent owner to collect damages from future infringers.

 

But before the patent issues – or even if no patent ever issues from the patent application – the manufacturer may still benefit from being able to mark its product Patent Pending for the duration of the patent application.  The patent pending mark serves as a deterrent.  It warns would-be competitors to think twice before jumping into the market with a copy of the product, because if and when the pending application becomes a granted patent, suddenly all sales of the copied product by the competitor become infringing sales.

 

Uncertainty in the mind of the competitor enhances the deterrent effect.  When was the patent application filed?  Without knowing that, one cannot determine whether a past event or publication is prior art.  What feature(s) of the product does the patent application cover?  The product might have numerous features, any one or a combination of which may be the subject of the patent application.  How broad or narrow is the coverage?  Even if you know what feature(s) are the subject of the patent application, the claims of the patent application might be narrow, such that the competitor could easily design around to avoid infringement, or the opposite might be true.  When will the patent issue?  It could be imminent, e.g. this week or next week, or it could be far off into the future, or even never, if the patent application becomes abandoned.  The more questions like these that are left unanswered, the riskier it is for the competitor to jump into the market with a copy of the product.

 

Historically, U.S. patent applications were prosecuted in secret, with only the patent applicant, and their designated patent attorney, being aware of the existence and status of the application.  In that framework, the “Pat. Pending” warning had maximum deterrent effect.  This changed in 2001.  In that year, the U.S. Patent Office began publishing most* (but not all – see below) U.S. patent applications 18 months after their earliest effective filing dates.  The 18 month publication of most U.S. patent applications continues to this day.  Even if the patent application remains pending for many years, the public is put on notice of its existence via the publication.

 

Furthermore, the U.S. Patent Office website provides a free service, known as Patent Application Information Retrieval (PAIR), that allows anyone to view both the status and the prosecution history of any published patent application or issued patent.  Thus, once a patent application is published at the 18 month date, and thereafter, anyone may access PAIR and view pdf images of the originally filed patent application and all correspondence between the patent office and the patent applicant, including all rejections the U.S. patent examiner may have made, and all responses to such rejections, and amendments of the application, by the applicant’s patent attorney.  The document list is regularly updated, and all of the documents remain available through PAIR after the patent application becomes a granted patent.

 

The PAIR database is clearly a powerful tool for monitoring the progress of a competitor’s published patent application.  But for those who mark their products Pat. Pending, it diminishes the deterrent effect of that notice by publicizing all the details of the patent application.  Despite this, depending on circumstances, there may still be a significant deterrent effect if the application is one that could spawn a patent that would cover the competitor’s product.

 

Not all U.S. patent applications are published at the 18 month date.  If, at the time of filing your patent application, you stipulate not to file the application in any other countries, you may request non-publication.  Your application will then not be published, and will not be available through PAIR, unless and until it actually issues as a patent.  This non-publication option may be highly desirable for some patent applicants.

 

“Anything under the sun that is made by man.”  That is how Chief Justice Warren Burger, in 1980, described the expansive scope of what types of inventions are eligible subject matter under the U.S. patent laws.  Of course, in order for something to be patentable, it is not enough to be directed to patent-eligible subject matter — it must also satisfy the other requirements under the patent laws.  For example, it must be new, and non-obvious.  But those other requirements come after the threshold question of whether the invention is directed to patent-eligible subject matter.

 

The “anything under the sun” expression is an exaggeration.  For many years, the courts have been imposing on the patent laws certain implicit judge-made exceptions regarding what qualifies as patentable subject matter.  Specifically, the courts have long said the following categories are not patentable:

  • laws of nature,
  • natural phenomena, and
  • abstract ideas.

The reason given is that these are the basic tools of scientific and technological work, and monopolization of those tools via the patent system would impede innovation more than it would promote it.  See Gottschalk v. Benson (Sup. Ct. 1972).  These judicial exceptions are why Einstein could not have patented his well-known equation E = mc2.  (See id.)

 

Closely related to abstract ideas is the area of computer-implemented technology such as software, and pure mathematical algorithms.  Historically, the U.S. patent office regarded methods of doing business as non-patentable subject matter.  With the advent of the computer, patent applications directed to methods carried out by computers (computer software) had to be addressed.  The patent office rejected such applications as non-patentable subject matter if the computer-implemented method too closely resembled a business method or a disembodied mathematical algorithm.

 

Eventually, with the rise of computer-related inventions in the 1980s and 1990s, the distinction between business methods and technological methods became impractical, and the need to provide patent protection for the rapidly growing computer and software industry became apparent.  The patent office abandoned its position that business methods were unpatentable, instead applying the same patentable subject matter standards to all computer-related inventions.  This approach was confirmed by an appeals court in 1998, which stated the historical business method exception was incorrect, and that computer software and other processes are patent-eligible subject matter as long as they provide a useful, concrete, and tangible result.

 

Since then, the standards or tests used by the patent office and courts for determining whether computer-implemented inventions such as computer software (as well as other inventions not necessarily associated with computers) are patent-eligible subject matter have undergone twists and turns.  Simply stated, after the 1998 court decision, the standards were fairly easy to comply with, and computer and software patents flourished.  This underwent further development until 2010.

 

At that time, the standard in use was that a method (e.g. computer software) was patent-eligible subject matter if (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing.  In 2010 the Supreme Court issued a decision, Bilski v. Kappos, that struck down a particular invention as an abstract idea.  In that case the Court held the machine-or-transformation test was not the sole test for subject-matter patentability, but unfortunately it did not make clear in its opinion what other standard should be used to determine if an invention was unpatentable as an abstract idea.

 

The absence of a clear standard had the effect of eroding patent protection for computer software and related inventions.  Two later Supreme Court cases, one in 2012 and one as recent as last June, held the respective method-related inventions were unpatentable as abstract ideas.  In the June 2014 decision (Alice Corp. v. CLS Bank), the Court outlined a two step analysis.  First, the invention is evaluated to see if it is directed to an abstract idea (or law of nature or natural phenomenon).  Second, the claimed invention is scrutinized to see if an inventive concept can be identified separate from the abstract idea.

 

The consensus in the patent community, confirmed by the latest lower court rulings, is that the effect of this and the other recent Supreme Court decisions will be to further erode computer software inventions and the like.  On the bright side, computer-related inventions are far from dead, and patents continue to issue from the U.S. patent office on such inventions.  If history is any guide, the pendulum may well swing back to stronger patent protection for such inventions in the coming years.

Have you heard of a design patent?  Maybe someone you know mentioned this as a less expensive alternative to a “regular” U.S. patent.

 

The U.S. patent laws actually define three basic types of patents:

  • utility patents
  • design patents
  • plant patents

 

Utility patents are by far the most common type of patent.  To date, almost 9 million have been issued by the U.S. Patent and Trademark Office (USPTO).  Utility patents are for utilitarian inventions such as machines, processes, compositions of matter, and articles of manufacture.  A utility patent has a written description section and a claims section.  Most utility patents also include drawings or figures, but in some cases the invention can be adequately described without any drawings.  At least one claim must be present, but usually there are many more, e.g., 10 or 20 or more.  There is no upper limit to the number of claims allowed, but the USPTO charges extra fees when a patent application contains more than 20.  After the patent issues, the USPTO charges maintenance fees to keep the patent in force for its full lifetime.  If the patent owner fails to pay the required maintenance fee at approximately 4, 8, and 12 years from issuance, the patent lapses prematurely.

 

Slightly over 700,000 design patents have been issued by the USPTO.  A design patent protects the ornamental appearance of a thing rather than its utilitarian function.  Protection is defined by the appearance of the design as shown by the drawings, which are thus required in a design patent.  The description is typically limited to a title of what the design pertains to, such as “bottle” or “electronic device”, and very little additional description.  In modern practice, only one claim is allowed, with standardized wording referring to the design “as shown and described”, or the like.  The classic shape of the Coke bottle, and the appearance of Apple’s iPhone, are two examples of ornamental appearances that have been the subject of design patents.

 

Unlike utility patents, an application for a design patent is not published by the USPTO before the patent issues.  Also, the term for a design patent is 14 years measured from the date of issue, rather than 20 years from the filing date for a utility patent, and no maintenance fees are required.

 

There is evidence that product design, i.e. the appearance or look of a product as distinguished from its function, is becoming more important to American manufacturers.  One need only cite the substantial efforts of companies such as Apple to design products that are not only functional but also aesthetically pleasing in order to gain greater market share and customer loyalty.  In that regard, if you happen to work for a manufacturing company that makes products whose aesthetic appearance is a marketing consideration, you may want to consider whether your next new product has any novel design features that are worthy of design patent protection.

 

However, design patents should not be considered less expensive versions of utility patents.  Although the cost of preparing and filing a design patent is typically a small fraction of that of a utility patent, the design patent cannot broadly protect functional innovations.  They are thus no substitute for utility patents.

 

Almost 25,000 plant patents have been issued to date.  This type of patent protects new and distinct varieties of asexually reproduced plants.  The patent typically includes drawings of the plant and a description of its characteristics.  The term for a plant patent is the same as a utility patent, 20 years from the filing date, but no maintenance fees are required.  Also like utility patents, applications for plant patents are published at 18 months from the earliest filing date, unless the application has already issued as a patent.

 

Different aspects of the three types of U.S. patents can be summarized as follows:

 

Utility Patents

Protect: function and utility of machines, methods, etc.

Applications published: yes

Number of claims: at least 1

Term: 20 years from filing

Maintenance fees required: yes

Filing fee*: $1,600

 

Design Patents

Protect: ornamental appearance

Applications published: no

Number of claims: only 1

Term: 14 years from issuance

Maintenance fees required: no

Filing fee*: $760

 

Plant Patents

Protect: asexually reproduced plants

Applications published: yes

Number of claims: only 1

Term: 20 years from filing

Maintenance fees required: no

Filing fee*: $1,140

 

The filing fees given above are those currently charged by the USPTO to large entities, e.g., medium- to large-sized businesses, for a standard patent application of the given type.

 

Every now and then something in the news appears as a reminder that most intellectual property rights do not last forever.  That happened in June when an appeals court ruled on a dispute involving Arthur Conan Doyle’s character Sherlock Holmes.

 

Before discussing that particular case, let’s review some basics.  Article 1, Section 8, Clause 8 of the Constitution provides that Congress shall have the power to promote the progress of science and useful arts by securing “for limited times” to authors and inventors the exclusive right to their respective writings and discoveries.  Within this broad framework, over the years, Congress has passed laws that set forth with more particularity what “limited time” is appropriate.  The limited time depends on the type of intellectual property.

 

For patents, the rule used to be simple:  the patent term was 17 years from issuance.  However, in some cases a patent can linger for many years in the U.S. patent office – in rare cases even a decade or more – before being issued or granted.  So to avoid disrupting a given industry with 17 years of exclusivity long after the market for an invention matures, the law was changed.  The nominal expiration date of a patent filed today is 20 years from the filing date.  However, extensions beyond the 20 years are given for certain delays by the patent office.  And the patent will lapse before the 20+ years if required maintenance fees are not paid.

 

For trademarks, common law rights arise automatically from the use of a trademark in commerce, and the continued existence of those rights depends only on the trademark remaining in use.  The federal trademark registration system established by Congress provides important advantages over common law rights.  A federal trademark registration, once obtained, lasts for 10 years (with a suitable declaration filed during the 5th year).  The registration can however be extended indefinitely, in 10 year increments, by payment of the required renewal fees coupled with continued use of the trademark in commerce.

 

For copyrights, the situation is very complex.  The term of copyright protection can depend on numerous factors, including but not limited to:  (1) the type of work, e.g., whether it is a textual or graphical work, sound recording, architectural work, etc.; (2) whether the work is published or unpublished; (3) if published, the year of publication; (4) whether the work was published anonymously or as a “work made for hire;” (5) the country of first publication; (6) the death date of the author; (7) whether publication included a copyright notice; and (8) whether copyright was “renewed.”  Amidst this complex backdrop is a simple rule with few exceptions:  books that were first published in the U.S. before 1923 are in the public domain.

 

This brings us to the Sherlock Holmes dispute.  Arthur Conan Doyle published a total of 56 stories and 4 novels about Holmes, the first appearing in 1887 and the last in 1927.  Most of the stories were published before 1923, but the last 10 were published from 1923-1927.

 

In the relevant (modern) time period, the copyright in the earlier stories had expired, but the copyright in the last 10 stories was still alive.  A writer named Leslie Klinger co-edited a book about Holmes.  The book featured modern stories inspired by, and depicting, the now-famous detective and his trusted companion Dr. Watson.  The Doyle estate learned of the project and contacted the would-be publisher regarding a license under its (remaining) copyrights.  Klinger believed a license was unnecessary because of the expired copyrights.  But the Doyle estate disagreed and threatened to prevent distribution of the book.

 

Klinger then sued the Doyle estate.  The estate apparently acknowledged the expiration of copyright in the early stories, but argued that the Sherlock Holmes character was not fully developed or perfected until all of the stories (including those still copyrighted) were published.  It compared a fully-developed literary character to a mural, which is first only sketched and later completed by being carefully painted.  Thus, it argued, Klinger needed a license under the still-copyrighted Holmes stories, even though the book only copied elements from the earlier (expired) stories.

 

In June, the 7th Circuit Court of Appeals rejected the estate’s arguments and affirmed a judgment for Klinger.  The court affirmed that when a story falls into the public domain, the story elements – including characters covered by the expired copyright – become fair game for later authors.  Based on this ruling we can look forward to more books and other media featuring the great Sherlock Holmes.

 

If you work at one of the many small- to medium-sized businesses that form the backbone of Wisconsin’s economy, you probably have a good idea of what a patent is – a property right granted by the government that gives the patent holder exclusive rights to an invention for a limited time.  You probably also understand that a patent is not a ticket to automatic fame and fortune, but a practical tool that can help foster a profitable business if combined with the right marketing strategy, sufficient capital, hard work, and some luck.  You may even have been involved in the patenting process as an inventor.  But you still may have lingering doubts, uncertainties, or misconceptions about patents.  In this article, we list a few common misconceptions people tend to have about patents.

 

Rights Granted by Patents

One persistent misconception is that a patent gives you the right to sell products covered by the patent.  Actually, a patent gives you the right to prevent others from selling products covered by the patent.  (Besides selling, patents regulate making, using, importing, and offering for sale.)  The distinction to keep in mind is that although you can stop others from selling products covered by your patent, someone else might be able to stop you from selling your own patented product.  This could happen if the other party already has a patent that “dominates” your patent, or that covers some other feature of your patented product.  For example, your patent might cover a particular type of overload protection for welding devices, but the other party’s patent might generically cover any overload protection for welding devices.  Or your patent might cover a particular combination of materials in a coated paper product, but the other party’s patent might cover any paper product that contains one of those materials.

 

Published Patent Applications vs. Granted Patents

These days, most U.S. patent applications are published before they are “issued” or “granted.”  To the untrained eye, the published patent application can be confused with the granted patent because they typically have the same drawings and the same detailed description, they both typically have a list of claims, and they have similar cover pages.  Despite these similarities, a published patent application by itself — unlike a granted patent — carries essentially no legal weight, and cannot be used to stop others from selling the invention.

 

Parts of a Patent

A granted patent has distinct parts that are arranged in a standard format, including a title, detailed description, claims, and (usually) drawings.  The detailed description is the part of the patent that describes aspects of the invention in detail.  This part of the patent explains the drawings, and may include descriptions of specific embodiments or “examples” of the invention that were actually made and tested.  Following the detailed description, the claims are presented in a list of numbered sentences.  These claims define the legal scope of the invention.

 

People sometimes confuse the legal impact of the detailed description and the claims of the patent.  For example, the detailed description may cite a specific material, component, or dimension.  People sometimes mistakenly assume such a specific citation limits the legal scope of the patent, even though it does not appear in the claims.  In another setting, while the patent application is being written and before it is submitted to the patent office, an inventor may object to referencing a specific material, component, or dimension in the detailed description in the mistaken fear it would necessarily limit the legal scope of the patent.

 

Types of Patents

The U.S. patent laws define different types of patents and patent applications, such as “design” patents, “provisional” patent applications, and “ordinary” (non-provisional) applications.  People sometimes confuse design patents, which protect the ornamental appearance of a product, and are relatively brief and inexpensive, with other patents.  People also often misunderstand the differences and similarities of provisional and ordinary patent applications, a discussion of which is beyond the scope of this article.

 

Effect of New Patent Law

The “America Invents Act” (AIA) was signed into law a few years ago and converted the U.S. patent system from “first to invent” to “first to file.”  Some people assume this means laboratory notebook procedures, wherein engineers keep careful records of their development work, are no longer needed because the date of invention is now irrelevant.  However, careful notebook records are still useful, e.g., to defend against someone else who derives the invention from you and then asserts their patent against you.

 

Does your business have a patent strategy?  If not, should it have one?  The answer may be “no” if your company delivers products or services that embody no new innovation.  But if your business sells products or services that require significant development costs, such as engineering or other creative resources, the answer may be “yes.”

 

A patent strategy is an agreed-upon procedure to be followed with regard to inventions for a given product or product area.  The patent strategy may be documented or undocumented, formal or informal.  Often, a company may choose to adopt different patent strategies for different products or product lines.

 

A well-considered patent strategy is based on an assessment of several factors, including:

  1. Offensive risk – the likelihood a competitor would copy your product, or use a novel feature from your product in their products, and what harm that would inflict on your business;
  2. Defensive risk – the likelihood a competitor has, or will have, a patent covering your product, and sue you for patent infringement, leading to possible money damages and a court injunction against you selling your product; and
  3. Resources – the budget or other resources your business needs to deal with patent-related issues.

 

Here are just a few of the many possible patent strategies you may wish to consider for your business.

 

Head-in-the-sand.  This approach involves ignoring all patent-related issues.  The business may be small and understaffed, and so busy that no one even considers patent issues, and there may be no resources set aside for patenting.  If patents are considered at all, the business owner may rationalize that the business is too small to be noticed by anyone with a patent portfolio.  Startup businesses that eventually succeed may regret taking this approach when they learn innovative features of their early products can no longer be patented due to the passage of too much time.  Or they may suddenly, unexpectedly be sued, or receive a cease and desist letter.

 

Competitive patent monitoring.  In this approach, published patent applications and patents of key competitors are regularly monitored.  The monitoring may also be defined in other ways such as subject matter or key words.  This approach seeks to reduce defensive risk by being aware of what other parties are patenting or trying to patent.  In some cases, if a relevant patent is discovered and it is owned by a non-competitive party, there may be an opportunity to approach the party for a license, possibly even an exclusive license in a desired field of use.  Discovery of the patent may also allow your engineering team to “design-around” the patent in order to avoid being accused of infringing the patent, while continuing to sell your product.

 

New product design reviews.  In this approach, before a new product or product modification is launched, an internal review is done to identify patentable features.  Depending on the importance of the product, the review may be cursory or it may be exhaustive.  Any novel features that are identified can be prioritized and evaluated for patentability.  The design review may also include a defensive analysis to identify conflicts with third party patents.

 

Picket fence.  Important new products may justify this approach, in which multiple patents are filed to protect different novel features of the product.  To maximize protection, patents may also cover different aspects of each feature, for example, one patent may cover the feature itself as an article, another may cover its method of operation, and still another may cover its method of manufacture.

 

Patents vs. defensive publications vs. trade secrets.  In some cases it may be wise to publish a novel feature of your product rather than try to patent it.  The publication, typically cheaper than a patent, acts as prior art to stop others from patenting it later.  The Bell System Technical Journal was published by AT&T for this purpose over many decades; today, internet publication options are available.  Sometimes, rather than publish or patent, the novel feature may qualify for protection as a trade secret.  Trade secret protection may be considered for features that are not readily apparent from inspection of the product.

 

Box-in the competition.  In this sophisticated approach, your engineering team is used to develop an improvement to a recently published patent of your competitor.  Then, you file for a patent on the improvement to block the competitor from using it. .

Does your business have a patent strategy?  If not, should it have one?  The answer may be “no” if your company delivers products or services that embody no new innovation.  But if your business sells products or services that require significant development costs, such as engineering or other creative resources, the answer may be “yes.”

 

A patent strategy is an agreed-upon procedure to be followed with regard to inventions for a given product or product area.  The patent strategy may be documented or undocumented, formal or informal.  Often, a company may choose to adopt different patent strategies for different products or product lines.

 

A well-considered patent strategy is based on an assessment of several factors, including:

  • offensive risk – the likelihood a competitor would copy your product, or use a novel feature from your product in their products, and what harm that would inflict on your business;
  • defensive risk – the likelihood a competitor has, or will have, a patent covering your product, and sue you for patent infringement, leading to possible money damages and a court injunction against you selling your product; and
  • resources – the budget or other resources your business needs to deal with patent-related issues.

 

Here are just a few of the many possible patent strategies you may wish to consider for your business.

 

Head-in-the-Sand.  This approach involves ignoring all patent-related issues.  The business may be small and understaffed, and so busy that no one even considers patent issues, and there may be no resources set aside for patenting.  If patents are considered at all, the business owner may rationalize that the business is too small to be noticed by anyone with a patent portfolio.  Startup businesses that eventually succeed may regret taking this approach when they learn innovative features of their early products can no longer be patented due to the passage of too much time.  Or they may suddenly, unexpectedly be sued, or receive a cease and desist letter.

 

Competitive Patent Monitoring.  In this approach, published patent applications and patents of key competitors are regularly monitored.  The monitoring may also be defined in other ways such as subject matter or key words.  This approach seeks to reduce defensive risk by being aware of what other parties are patenting or trying to patent.  In some cases, if a relevant patent is discovered and it is owned by a non-competitive party, there may be an opportunity to approach the party for a license, possibly even an exclusive license in a desired field of use.  Discovery of the patent may also allow your engineering team to “design-around” the patent in order to avoid being accused of infringing the patent, while continuing to sell your product.

 

New Product Design Reviews.  In this approach, before a new product or product modification is launched, an internal review is done to identify patentable features.  Depending on the importance of the product, the review may be cursory or it may be exhaustive.  Any novel features that are identified can be prioritized and evaluated for patentability.  The design review may also include a defensive analysis to identify conflicts with third party patents.

 

Picket Fence.  Important new products may justify this approach, in which multiple patents are filed to protect different novel features of the product.  To maximize protection, patents may also cover different aspects of each feature, for example, one patent may cover the feature itself as an article, another may cover its method of operation, and still another may cover its method of manufacture.

 

Patents vs. Defensive Publications vs. Trade Secrets.  In some cases it may be wise to publish a novel feature of your product rather than try to patent it.  The publication, typically cheaper than a patent, acts as prior art to stop others from patenting it later.  The Bell System Technical Journal was published by AT&T for this purpose over many decades; today, internet publication options are available.  Sometimes, rather than publish or patent, the novel feature may qualify for protection as a trade secret.  Trade secret protection may be considered for features that are not readily apparent from inspection of the product.

 

Box-In the Competition.  In this sophisticated approach, your engineering team is used to develop an improvement to a recently published patent of your competitor.  Then, you file for a patent on the improvement to block the competitor from using it.

 

Although this article is specific to patents, similar strategies can be adopted for other forms of intellectual property, such as trademarks and copyrights.

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