Costs and Benefits of Obtaining IP Protection in the USA

1. INTELLECTUAL PROPERTY
PROTECTION IN THE US
AYLIN AKTURK SAHIN
ATTORNEY, PH.D. CND, UC BERKELEY LAW SCHOOL
CO-FOUNDER, IGNITERS TECH CONSULTING

2. WHAT IS INTELLECTUAL
PROPERTY? (IP)
IP is any product of the human intellect that the
law protects from unauthorized use by others.
-inventions (Google’s search algorithm)
-literary and artistic works (books, movies,
even software)
-symbols, images and names used in
commerce

3. METHODS FOR
PROTECTING YOUR IP
1) Contracts
2) Patent
3) Trade secret
4) Copyright
5) Trademark

4. 1) CONTRACTS
Flexible, effective, cheap
-Non Disclosure Agreements
(Negotiating with Investors or business partners)
-IP Assignments Agreements
(startup founders, employees)
-Non Compete Terms in Employment Agreements
(employees)

5. 2) PATENT
Patent is a governmental authority that gives you
the right to exclude others from
-using
-making
-selling
-offering to sale
-importing
your patented product in the US for 20 years from
filing.

6. TYPES OF PATENTS
-Utility Patents (Software, computer implemented
inventions)
-Design Patents
-Plant Patents
System: Microsoft’s page up page down patent
Method: Apple’s slide to unlock patent
Process: Amazon’s one click shopping patent

7. STANDARDS TO OBTAIN
A PATENT PROTECTION
Novel: published document, prior public
use, previous patent
(German Court said Apple’s slide to unlock
patent is not novel, improvement is fine)
Useful: provide practical benefit, help solve
real life tasks
(a motorized spaghetti fork)
Non-obvious: ordinary skilled person in the
field shall find it a surprising development

8. ENABLEMENT
A patent application must disclose an invention in
sufficient detail so that a person of ordinary skill in
the art may make and use the invention.
It is a public disclosure of the invention in
exchange for a monopoly for 20 years.
A patent application shall provide;
1) A clear and concise written description
2) Graphs to show the invention

9. APPLE’S 3D GESTURE
CONTROL PATENT
US Patent No 8933876
Title: Three dimensional user interface session control
Filed: December 2011
Issued: January 2015
Abstract:
A method, including receiving, by a computer executing a non-
tactile three dimensional (3D) user interface, a set of multiple 3D
coordinates representing a gesture by a hand positioned within
a field of view of a sensing device coupled to the computer, the
gesture including a first motion in a first direction along a
selected axis in space, followed by a second motion in a second
direction, opposite to the first direction, along the selected axis.
Upon detecting completion of the gesture, the non-tactile 3D
user interface is transitioned from a first state to a second state.

11. HOW TO APPLY
• United States Patent and Trademark Office
(USPTO)
• Patent Attorney or Self
• Non US Citizens can obtain patent
• Average 4 years
• Inventors are real persons
• Assignee might be a real person or company
(Apple patent)

12. COST (WITHOUT AN
ATTORNEY)
Application fee: 70 USD (25% of the full price) for
micro entities
140 USD (50%) for small entities.
Each independent claim in excess of three: 105
USD, 210 USD
Patent examination fee: 180 USD, 360 USD
Utility search fee: 150 USD, 300 USD
The average cost will be around 400-800 USD for a
micro entity and 1000-1800 USD for a small entity.

13. COST (ATTORNEY
FEES + USPTO FEES)
• Depending on the hours worked on the
application
• Experience of the attorney
• Average cost for a software patent
application
-10000/15000 USD

14. 3) TRADE SECRET
Information that you take reasonable precautions to
keep it secret
• Coca Cola Formula
• Google’s algorithm for its search engine
• KFC’s recipe
-strongest IP protection
-Just don’t tell anyone or disclose to few people
-Free
-or cost some money depending on the precautions
you take

15. 4) TRADEMARK
Name (Chanel)
Letters and words (IBM, Amazon)
Logo
Sound (windows’ starting sound)
combination of these that legally distinguishes one
company's product from any others.

16. APPLYING FOR
TRADEMARK
• USPTO
• Search USPTO’s trademark database
• Attorney, non-attorney
• The attorney fees plus governmental
fees for trademark registration: 1000-
2000 USD
• the time period for approval is 6 months
to 1 year
• enforceable as long as you use it

17. 5) COPYRIGHT
Protects the expression of an idea in a tangible
form by excluding others from;
reproducing, displaying, distributing copies of
your copyrighted work.
The Pac-Man Game
Copyright protects the actual artwork and
sounds as an audiovisual work
Underlying software as a literary work

18. …CR CONTINUED
CR protection is automatic which means you
obtain protection as soon as you put your original
work in a tangible form.
-develop a software
-save your software in a CD-ROM
-write your source code on paper
BUT,
-you may only file a copyright infringement lawsuit
if you have registered your software at USCO

19. HOW TO REGISTER YOUR
CR IN A COMPUTER
PROGRAM
• United States Copyright Office (USCO)
• Approval takes 8 months for online applications
and 13 months for applications by mail.
• The attorney fees plus governmental fees for
copyright registration costs around 250-500 USD
• Protection term is authors life time plus 70 years

20. …CONTINUED
. First 25 and last 25 pages of source code with portions
containing trade secrets blocked out, or
• First 10 and last 10 pages of source code alone, with no
blocked out portions, or
• First 25 and last 25 pages of object code plus any 10 or
more consecutive pages of source code, with no blocked out
portions, or
•For programs 50 pages or less in length, entire source
code with trade secret portions blocked out

21. BENEFITS OF IP
PROTECTION
1. Protects against infringement.
2. Generates revenue through licensing
activities.
3. The ability to exclude others to enter the
market grants the IP holder an
opportunity to reduce competition and
set higher profit margins.
4. Serves as an investor magnet as it
reduces the risk of litigation due to a
potential infringement.

22. BENEFITS OF IP
PROTECTION
5) If your startup’s business strategy is being
acquired by a big tech company, your IP
portfolio will matter in determination of the
acquisition price.
6) Patent portfolio of a tech company is
regarded as a top metric in its innovation value
as it is a sign that the company has an
innovative engineering team.
7) Beneficial in defending your company
against patent and copyright trolls.

23. IP STRATEGY FOR A
STARTUP
• First, determine if your product is viable
in US market
• Second, identify your business goals
and key technology carefully
• As you do not have enough resources
only patent your key technology
• Apply to patent critical features which
are not easy to design around.

24. ALWAYS ASK THESE
QUESTIONS
Is obtaining a patent really material to your
startup’s success?
How durable is your technology in a fast moving
sector?
Is licensing in case you infringe on someone else’s
patent viable?
What is your exit strategy?
Should you develop a patent portfolio specifically
for cross-licensing in case you infringe?

25. CONSIDER PROVISIONAL
PATENT APPLICATION
Cheap: 65 USD application fee
1000-1200 USD with the support of an
attorney
Early filing date
You will have 12 months to look for more
funding
You may use “patent pending” status

26. CONSIDER OTHER IP
PROTECTION METHODS
Copyright, trademark and trade secret
protection as the costs are
considerably low compared to patent
application.

27. E MAIL AYLIN FOR
QUESTIONS
aylin@igniterstech.com
aylinakturk@berkeley.edu