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Intellectual Property Triage
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Intellectual Property Triage

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Realistically, innovators must work within a budget to protect IP. This presentation explores IP basics and considerations when determining whether and how to allocate limited funds for maximum IP …

Realistically, innovators must work within a budget to protect IP. This presentation explores IP basics and considerations when determining whether and how to allocate limited funds for maximum IP protection.

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  • 1. © 2012 E.H.SchiermanELIZABETH HERBST SCHIERMANUS Patent Attorney Based on Presentations for Idaho Technology Council and Univ. Idaho College of Law, Business Law Ass’n
  • 2.  Widget 2.0:  Inventors have developed a new and improved widget   Started a partnership  No employees  Hired designers for:  Logo  Website  Product packaging  Expecting big sales Instructions: in U.S. and oversees Lots and lots and lots of fine printThe hypothetical is meant to be purely fictitious.Any similarity to real inventions, businesses, etc. is unintended
  • 3.  Inventions  Article of Manufacture  Process  Machine  Composition of matter  Ornamental design for article of manufacture  Plants In Widget 2.0 World: Patent Types, e.g.: (1) Article – the widget  Utility (2) Process – method of making (3) Composition – polymer from  Design which widget is made  Plant
  • 4.  Symbols indicating source, origin, sponsorship, or endorsement of goods or services E.g.: Product name, business name, logo Note: Trademarks often used in domain names (www.trademark.***), but the domain name is not necessarily a trademark In Widget 2.0 World: (1) Plain word mark: WIDGET 2.0 (2) Stylized mark: Note: www.widget.*** - not a trademark
  • 5.  Work of original authorship fixed in tangible form E.g.: packaging, website design, source code, photographs, advertisements In Widget 2.0 World: (1) Product packaging design (2) Website design (3) Logo design Instructions: Lots and lots and lots of fine print
  • 6.  U.S. Patents:  Invent  File Patent Application w/ U.S.P.T.O.  …wait years (~3 yrs, avg.)… CREATION OF  Receive issued U.S. patent PATENT RIGHTS  (Pay maintenance fees) This is the ONLY path to establishing patent rights for an invention
  • 7.  Trademarks: POTENTIAL  Use in commerce in distinctive CREATION OF manner COMMON LAW Optionally… TRADEMARK RIGHTS  File Trademark Application (before or after starting use)  w/ State CREATION OF REGISTERED  w/ U.S.P.T.O. TRADEMARK  …wait months (~11 mos., avg.)… RIGHTS  Receive Trademark Registration  (Renew Registration every 5-10 years)
  • 8.  Copyrights:  Fix creative work in tangible form  File Copyright Application w/ U.S. Copyright Office CREATION OF COPYRIGHT RIGHTS  …wait a few months (2.5 – 6.5 mos., avg.) CREATION OF  Receive Registration Certificate ABILITY TO SUE FOR COPYRIGHT INFRINGEMENT Note: Registration is not a prerequisite to having copyright rights, but it is prerequisite to take legal action against an infringer.
  • 9.  (Utility) Patents:  Rights: Exclusive right, in the U.S. to:  Make,  Use,  Sell,  Offer to sell, and  Import the patented invention as claimed  Duration: 20 years from earliest filing date (except provisional filing date)
  • 10.  (Utility) Patents:  Value of Formal Protection:  ONLY means to acquire patent rights & stop others from making/using/ selling/importing the patented invention  Can stop patent infringement  Something to license – get royalties?  Something to assign – sell business?  Collateral for loans/investments – build business?  Clarify ownership
  • 11.  Trademarks:  Rights: Exclusive right, within area*, to stop junior users from adopting or using marks likely to cause confusion  Common law: *area = area of actual use  State Registration: *area = all of State  Federal Registration: *area = all of U.S.  Duration – For as long as it is used (registrations maintained)
  • 12.  Trademarks:  Values of Formal Protection:  Expands constructive area of use – broader trademark rights  Avoids conflict? – easier for others to discover your rights  Something to license – start franchises?  Something to assign – sell business?  Clarifies ownership  Easier to stop cyber squatters?
  • 13.  Copyrights:  Rights: Sole right to  Reproduce;  Adapt to create derivative works;  Distribute copies by sale, rental, lease, lending;  Perform/display publicly Duration:  Generally: Life of author + 70 years  Work Made for Hire: Earlier of 120 yrs after creation or 95 yrs after publication Values:  Can stop copyright infringers
  • 14.  Copyrights:  Values:  Statutory damages ($750-$150,000) … if copyright registered w/i 3 mos. of publication or before infringement begins  Required before lawsuit to stop copyright infringer  Clarifies ownership In Widget 2.0 World:  Something to license/assign Important – because the hired designers (independent  Eases licensing? contractors) may own the copyright rights absent an assignment to the business.
  • 15.  U.S. Utility Patents:  Application Preparation:  ~$2,000-$15,000+  Filing Fees:  Nonprovisional: $1,260 ($630 s.e.)  (or, 1st, Provisional: $250 ($125))  Prosecution: ~ $2,000-$15,000+  Issue Fees: ~$1,770 ($885)  Maintenance Fees: ~$1,130 ($565); ~$2,850 ($1,425); ~$4,730 ($2,365)  TOTAL – over period of ~ 20 years ~$18,000 ($12,000) – $35,000 ($30,000)
  • 16.  Utility Patent – Avg. Complexity Start with Nonprovisional $12,000 Nonp. Prep $10,000 & Filing Large Entity Small Entity Cost Incurred $8,000 Maintenance Fees $6,000 Totals over 20 year period: Prosecution to ~ $27,000 large entity $4,000 Allowance ~ $17,000 small entity $2,000 $0 0 2 4 6 8 10 12 14 16 18 20 Time (years)
  • 17.  Utility Patent – Avg. Complexity Start with Provisional $12,000 Prov. App. Prep & Filing $10,000 Nonprov. App. Prep & Filing Cost Incurred $8,000 Large Entity Maintenance Fees Small Entity $6,000 Totals over 21 year period: Prosecution to ~ $30,000 large entity $4,000 Allowance ~ $18,000 small entity $2,000 $- 0 2 4 6 8 10 12 14 16 18 20 Time (years)
  • 18.  Trademarks:  Common Law: Free  State Registration:  ID Sec’y State Fees: $30  Prep. Cost: ~$200-$500  Renewal: $30 every 10 years  Federal Registration:  USPTO Fees: $275-$375  Prep. Cost: ~$200-$500  Prosecution: ~$200-$500  Renewal: ~$300-$500 @ 5 years and every 10 years thereafter
  • 19.  Copyrights  Initial Creation: Free  Registration:  Application Fees: $35-$65  Maintenance: $0
  • 20.  To File Patent Application:  U.S. Patent Protection: 1 year from 1st public disclosure* – not extendable  *may include sales, offers for sale, public use, publications, presentations, non-confidential discussions, etc.  U.S. Patent System changing in March 2013!!  1st Inventor to File Application  No more 1 year grace period on public use, offers for sale, or otherwise making invention available to public ??  Most other countries: No grace period; Barred from patent if application not filed before public disclosure
  • 21.  To File Trademark Application:  None – as long as trademark is in use
  • 22.  To File Copyright Application:  Generally, none until copyright expires (decades)  Generally - Life of author + 70 years  Work Made for Hire: Earlier of 120 yrs after creation or 95 yrs after publication  However, to get statutory damages – 3 months from publication or before infringement begins
  • 23.  Considerations:  Does business’s success rely upon any of:  Unique product/services?  Good reputation in a highly-competitive market?  Selling easily-copied creative work?  Is the IP the business uses owned by someone else (e.g., employees, independent contractors)?  Is the business going to grow into other markets, states, countries?  Will the business be sold or franchised?  Does the business want to leverage its assets for funding?
  • 24.  Prioritize Patent Protection as High if:  Unique product (or method/composition/etc.) is an important asset  Someone with skill in the field of art could copy the product (or method/composition)  Competition likely to grow or copy upon examining the product (or method/composition)  There is even a slight possibility that the business may want patent protection  (Because patent rights may be forever lost if the business/inventor waits too long to file a patent application)
  • 25.  Prioritize Trademark Protection as High if:  Reputation is principle selling point  Market is highly competitive  Trademark (business name, product name, logo, etc.) may be something that a competitor might think of on its own  Business wants to stop others from registering website addresses (domain names) using the trademark  Business wants to franchise or license others to use the trademark  Business knows of another who started using a similar trademark after business adopted its trademark
  • 26.  Prioritize Copyright Protection as High if:  Profits rely upon sales or licensing of creative work  Business sells a software product and wants to stop others from copying the code  Business knows of copying of its creative work by another and the copying is hurting the business
  • 27. Instructions: Lots and lots and lots of fine print Widget 2.0 Hypothetical:  With $15,000 budget: 1) Patent search online - $0 2) Nonprov. Patent App. Prep w/ Search - $10,000 -Widget article; Method of making; & Composition 3) Nonprov. Filing: - $630 4) Trademark Search for WIDGET 2.0 - $800 5) File Trademark App. for WIDGET 2.0 - $850 6) Get design copyrights assignments from designers & register copyrights - $600 TOTAL: $12,880  Start saving for prosecution of trademark application in ~6 mos. & patent application in ~2+ yrs
  • 28. Instructions: Lots and lots and lots of fine print Widget 2.0 Hypothetical:  With $5,000 budget: 1) Patent search online - $0 2) Prov. Patent App. Prep w/ Search - $3,875 3) Prov. Filing - $125 4) Trademark search for WIDGET 2.0 - $800 5) Get copyrights in logo design, website design, and product packaging assigned from designers - $200 TOTAL: $5,000  Start saving for nonprov. patent app. costs w/i 6 mos.-1 yr. & for filing federal trademark application
  • 29. Instructions: Lots and lots and lots of fine print Widget 2.0 Hypothetical:  With $500 budget: 1) Patent search online - $0 2) Independent Prov. Filing - $125 3) Trademark search online - $0 4) Get copyrights in logo design, website design, and product packaging assigned from designers - $200 TOTAL: $325  Start saving for nonprov. patent app. costs w/i 6 mos.-1 yr. & for filing federal trademark application
  • 30. Instructions: Lots and lots and lots of fine print Find reliable guidance early! Don’t delay in creating an IP Protection Plan There is more than one type of IP protection Budget for an on-going IP protection process A business’s time and effort can save it money if it:  Trains employees/contractors to keep good records  Provides its IP att’y with all information without delay  Responds on time to the Patent/Trademark/Copyright Office Quality counts! Get it right the first time!  Mistakes cost money and can mean permanent loss of rights
  • 31. Find me on: LinkedIn: Twitter: www.linkedin.com/in/EHSchierman @EHSchiermanElizabeth Herbst SchiermanUS Patent AttorneyThe information in this presentation is of a general nature. It is not directed to any specific circumstanceand should not be taken as legal advice. © 2012 E.H.Schierman

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