Patenting Your Invention: the Ugly Truth – Page 1

Introduction

  

   Despite all our words of caution in  A Better Mousetrap about a patent being a double-edged sword, many inventors are still too easily persuaded to patent their inventions needlessly or prematurely.

   Here, there and everywhere they’re given the impression that no matter what their invention, they must patent it if they are to stand any chance of making money from it. Worse, it’s often the first advice new inventors get, from professional advisers who in many cases don’t actually know much about patents. The myth is reinforced on TV programmes like Dragon’s Den where ‘Have you patented it?’ is a routine question, heavy with the implication that you’re a loser if you haven’t.

   So as an antidote, Patenting your invention: the ugly truth lays it on with a trowel. And we make no apologies for it. We say: if you haven’t weighed up all the complex pros and cons, patenting your invention could be the most expensive mistake you ever make.

   Cash-strapped inventors and small businesses need to plan their intellectual property rights (IPR) strategies at least as carefully as big companies, who learn to be very sophisticated about IPR. The theme of devising an appropriate IPR strategy, rather than rushing headlong into patenting, is developed in A Better Mousetrap. Although this supplement may seem like one long venting of spleen, there is a bigger, more constructive picture to be found in the book proper. All we need say here is that there are other IP weapons beside patents for protecting an idea, but they rarely get the credit they deserve.

   Patenting your invention: the ugly truth is free information for anyone to use. All we ask is a copyright acknowledgement and a link to abettermousetrap.co.uk. If you want to quote from it, that’s fine as long as you (a) quote accurately and (b) acknowledge the source.

   Finally: patent attorneys please note. Our intention throughout is not to knock what you’re doing. You’re not responsible for a deficient legal system. These pages may contain opinions you can’t publicly endorse, but we hope that privately you’ll be on board with most of it. We know that many of you do give inventors good strategic advice, but for one reason or another it doesn’t sink in. That isn’t your fault but it often isn’t the inventor’s fault either. We want to plug an education gap, on the grounds that an informed inventor is a better client.

   So here we go.

 

If you’re not rich, the patent system isn’t for you

 

Q: Why do patents exist?

A: To disclose new technologies so that they can be put to commercial use.

   And that’s pretty much it. Sure, a patent indicates ownership of an idea, but be in no doubt: the main intended beneficiary of the patent system is business and industry. The theory is that if there is an abundant supply of openly disclosed new ideas, technologies will advance, markets expand, businesses grow and economies prosper.

   Better still, the patent system operates worldwide, providing a global pool of ideas. Thus, a French company might make use of a US invention, or an Australian company make use of a German invention.

   All this is fine for industry, which gets lots of new ideas to pick over. But two factors make the practice of the patent system very different from the theory.

 One:

   Many patents are not available for exploitation. They’re owned by big companies who use the patent system to prevent others from using certain technologies, except under strict conditions that they dictate through licences. Now there is nothing wrong with licences; they’re an excellent way of spreading the benefits of one idea across several companies or markets. Many inventors license out their IP (which doesn’t just mean patents) in return for royalties. But large companies often don’t want anyone else to innovate. They use their patents as an offensive weapon, to frustrate or threaten competitors both large and small. Or they patent ideas they have no intention of using, simply to prevent others from going there.

   This behaviour acts as a deterrent to innovation. It’s an exercise of power by companies more interested in maintaining their control of a market than in seeing technology advance to the betterment of mankind. In this endeavour the passivity of the patent system is a big help to them.

   Then there are the so-called patent trolls – companies that buy unused patents cheaply, then hunt for companies they can pursue aggressively for ‘infringement’. Major companies have been hit by trolls (Apple was ordered to pay over $20m to patent troll Opti) but small companies are just as likely to be targets. Many companies pay up on threat because it’s cheaper than a court case, the cost of which could destroy a small company. This kind of predatory activity is made easy by the patent system. The mere threat of always expensive legal action is enough to provide patent trolls with a good living in ‘compensation’.

   (Some argue that trolls create a useful secondary market in patents, which can help inventors who otherwise can’t afford to enforce their IP. But if a troll buys an inventor’s patent cheaply and then gets rich off the back of it, only the troll really wins. And a troll will happily target a small inventor-led business if there’s a killing to be made. These are not Robin Hood operations.)

   Thus, the high moral purpose of the patent system is to encourage invention and innovation. But all too often, the way the patent system is used has the opposite effect. Inventors and innovators are discouraged, threatened and punished.

 

Two:

   The only ideas actually available for commercial exploitation at relatively bargain rates – ground-floor opportunities to innovate, in other words – tend to be owned by individuals or small companies. Commercially, there will be some real diamonds to be found here. Yet these are the patentees who, to be very blunt, run the biggest risk of getting screwed by the patent system.

 

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