A patent is an official document granted by the federal government conveying to the recipient, called the patentee, specific rights named in the document and in the statute authorizing it. These rights are known as patent rights and are clearly defined in the statute (35 U. S. C. § 154) as: "... the right to exclude others from making, using, or selling the invention throughout the United States." The key term in the statute is the word exclude which is an essential feature of any property right. Thus, a patent is a grant of intellectual property rights by the United States which permits the patent owner to stop others from exploiting his patented invention.

A patent includes three essential components: drawings (usual­ly but not always); a specification, which explains the patented inven­tion; and, finally but most importantly, claims, which define that which the patent right covers. In other words, the claims of a patent define the extent of the intellectual property right which is granted by the federal government.

An essential feature of a patent is its limited life, as required by the Constitution. Congress has set a time limitation of seventeen years (fourteen years or shorter terms for ornamental designs) from the date of the grant of the patent, at the end of which the patent right expires. In this way, the patent owner has seventeen years during which he has a right to prevent others from making, using or selling the patented invention. However, the public benefits as well because, after the patent expires, the patentee no longer has the right to ex­clude anyone from making, using or selling the invention of the pa­tent. Equally importantly. since the inventor must describe the public inspection setting forth such grants. Such "Letters Patent" were granted for limited times for new inventions within the realm. With passage of time, the phrase "Letters Patent" became shortened to the term patent, but both mean the same thing.

 

OTHER FEATURES OF PATENTS

A patent is far more than simply a legal document. It is also a tech­nical publication and a sales brochure. It is a technical document in that it contains a written description of the patented invention so that everyone interested in the field to which the patent pertains may learn how to make and use the invention by reading the patent. Thus, issued patents provide a wealth of technical information for the public, often unavailable elsewhere. A patent is analogous to a sales brochure because it describes what was known before, common­ly referred to as the "prior art," and then sets forth how the present invention is an improvement over the known state of the art.

The original patent document goes to its owner and is in the form of a set of printed pages and drawings (if any) that are bound together with a blue ribbon fixed under a crimson seal. Informal printed copies of the patent are published by the government and are available from the U.S. Patent and Trademark Office, which is a part of the Commerce Department. The mailing address of the of­fice is Washington, D.C., 20231, but the current physical location of the office is Crystal City, Virginia, just a few minutes from Washington's National Airport. Libraries in several major cities throughout the country have collections of U.S. patents.

Top

THE VALUE OF PATENTS

One need only consider the cotton gin, the telegraph, the telephone, the airplane, the transistor, the computer and a host of other inven­tions, all of which were patented, to realize that an essential corner­stone of the American success story is the framework for innovation provided by the patent system. The inventor is rewarded with the grant of the power to exclude and thus is encouraged to come forth with new developments while the public benefits because, through patents, knowledge of inventions is made available to everyon   

But the value of the patent itself can be no greater than the com­mercial value of the invention covered by the patent. It is the inven­tion described and claimed in a patent and the market for the prod­ucts or processes based on that invention that determine the value of the patent and not vice versa. Thus, the reward to the patent owner is closely related to the commercial importance of the patented inven­tion. An inventor will reap a reward from a patent only if the inven­tion ultimately meets with consumer approval.

The benefits to the public from the patent system can be enor­mous. Besides stimulating inventions, patents provide the right to exclusivity necessary to attract the capital and effort required to develop inventions into perfected and marketable form. Patents for pioneer inventions often provide the foundation for entire new in­dustries. Even patents covering minor improvements of a product or process may have significant value if the improvement results in a product or process either strongly preferred over competing prod­ucts or one that is less expensive to manufacture or use.

HOW TO EVALUATE AN INVENTION

Normally, evaluation of an invention is rather speculative. How­ever, a few tests can be applied that may eliminate some ideas from further serious pursuit. These tests relate to the product that em­bodies or results from the invention.

Careful study should be given to the required investment for making a new product, or alternatively, to the necessary changes in existing production facilities. The advertising budget that will be required to change public buying habits to accept a new product is important. The potential size of the market also should be consid­ered. Finally, a study should be made to predict the likely profit from the product. In sum, to determine the potential value of a pa­tent, it is necessary to make a comprehensive business evaluation of the resulting product.

Although the value of a patent depends primarily on the com­mercial importance of the invention or discovery, there are other important considerations. The credibility associated with a discov­ery is a primary factor in attracting help to exploit it. A successful inventor acquires credibility in the same fashion as a successful painter or writer. In the absence of prior success, an inventor must build credibility by proving the product of his invention or discov­ery. For example, a certain amount of credibility may result from the completion of an operating model. Usually, more credibility is gained with a production prototype. A favorable sales history for a patented product builds credibility. In other words, any step that concretely bridges the gap between a conceived idea and actual commercial exploitation tends to build credibility.

Timing is another element that affects the value of an inven­tion. The life of utility and plant patents in the United States is sev­enteen years, starting with the date of issuance. At the end of that time, patent rights in the invention expire and, usually, the inven­tion can be freely used or worked by anyone. A variety of economic, production, and management factors may come into play to shift the period of patent protection away from the period when an invention is commercially important. For example, the marketing period for a toy is often short-lived and may have passed even before a patent is granted. In those industries where change is expensive and time consuming, e.g., the automotive industry, actual produc­tion methods may lag current available technology by a period that is much longer than the life of a patent. Thus, the value of a patent can be greatly influenced by the patterns for change that exist for specific products and industries.

Unfortunately, many inventors often grossly underestimate the cost and difficulty of commercializing their inventions and overesti­mate market size and the chances of purchaser acceptance. Thus, an inventor must be prepared to face and overcome numerous diffi­culties before his invention returns a profit. The inventor must be willing to work hard to realize his reward.

But, before proceeding to obtain a patent, it is well to know what a patent is not and, further, what a patent cannot do.

Top

WHAT A PATENT IS NOT

A clearer understanding of just what a patent is requires considera­tion of what a patent is not. For example, a patent is not a trademark or copyright, these being three distinct fields of intellectual property law having little to do with one another. One who owns a trademark has the right to exclude others from using a confusingly similar trade­mark in commerce in such a manner as to confuse the public as to the source or origin of goods (or services) bearing the mark. Whether the goods are patented or not has nothing to do with rights afforded by trademark law.

A copyright permits the copyright owner to exclude others from copying the copyrighted material (books, plays, music, statues, mo­tion pictures, television programs, etc.) but copyright protection does not extend to an underlying invention which might be described in the copyrighted matter. Thus, a copyright could be used to prevent others from copying a book describing an invention, but the copy­right could not be used to prevent someone from using the knowledge set forth in the book and then making, using or selling the invention. For example, a copyrighted book may fully describe a lawnmower but no one could be stopped from building a lawnmower as taught by the copyrighted book.

It is also important to know that a patent confers no right of any kind to make, use or sell the invention. What is granted is strictly the negative legal right to exclude others. For example. new drugs are pa­tented all the time, but Food and Drug Administration approval is re­quired before these patented drugs can be marketed. Furthermore, a patent is not self-enforcing. The government will not take any positive action on behalf of the patent owner. The government simply grants the right to exclude and leaves it to the patent owner to enforce the right-if he can. For this reason, a patent is sometimes called a mere license to sue. The government's role in case of a suit is the pro­vision of the federal judicial system wherein suits can be brought.

A patent is not necessarily worth anything. Since a patent simply grants the right to exclude, its value rests entirely upon the utility of the invention and the desire of others to use it or to be in possession of the right to exclude. That is, someone might want to buy the patent from its owner. A patent is simply a document and not an invention. The invention is that which is described and claimed in the patent. It is also important to note that a patent may describe an additional invention or inventions beyond what is covered by the claims of the patent.

A patent cannot be kept secret or "suppressed." An essential aspect of obtaining a patent is that a full and complete disclosure of the invention is made so that others may practice it when the patent expires (absent some superior right in others). The only secrecy in the patent system is that by law the application for patent is maintained in secrecy by the Patent and Trademark Office until the patent is­sues. But the word patent means open. The day the patent issues, copies are made available to anyone who wants them (for a modest price). Suppression of a patent, in the sense of secrecy, is simply a misconception. The most a patent owner can do in this regard is fail to commercialize the invention himself or refuse to allow others to do it by refusing to grant licenses. Inventions, of course, may be sup­pressed by keeping them out of use and secret, but patents can nei­ther be kept secret nor suppressed.

The geographic extent of enforcement of a U.S. patent is limited to the fifty states and U.S. territories and possessions. Thus, a U.S. patent cannot be enforced in Canada, Japan, Europe or in any other foreign country, but the importation of products from abroad which infringe a U.S. patent may be stopped and the infringer may be sued here. Also, the United States has ratified several treaties which pro­vide significant advantages for those wishing to seek foreign patent protection, based on a patent application filed in this country. The details and provisions of such treaties are beyond the scope of this brochure but can be explained by a patent lawyer. Suffice it to say that securing foreign patent protection can be very expensive and should not be considered seriously unless a market for the patented invention abroad has been or is about to be established by the patent owner. As yet, there is no such thing as a true "international patent."

The grant of a patent does not provide any assurance that prac­tice of the patented invention will not infringe a patent owned by another. For example, a patent might be granted for an improvement to a previously patented device, but practice of the improvement invention might well infringe the claims of the earlier patent on the device. Similarly when a patent expires, it is not always true that the invention may be freely exploited by anyone. There could very well be another unexpired patent having claims which would be infringed by one practicing the invention of the expired patent.

Top

WHAT IS PATENTABLE?

Once it is determined that there is a real, potential market for a prod­uct or process, and good business judgment suggests it should be commercialized and patent protection is desirable for the invention, the question to be asked is: Can the product or process be protected from imitators after it is revealed to the public? In other words, can the invention be patented?

Not every invention is patentable in the United States. To be patented, an invention must fall within the following categories. Patents are granted for seventeen years on new and useful inventions or discoveries of:

1. Processes,

2. Machines,

3. Manufactures,

4. Compositions of matter,

5. Processes involving new uses of known processes, machines,

manufactures or compositions of matter,

6. Improvements in any of the above, and

7. Asexually reproduced plants.

Patents are also granted for fourteen years (and shorter terms) for any new, original and ornamental design for an article of manufacture.

In general, the Patent and Trademark Office is liberal in apply­ing the limitations of these invention classes providing that an invention is presented in a palatable fashion. For example, over the years patents have been granted on: automobile parking structures, drive­in theaters, slot machines, and a host of computer applications.

Perhaps a better notion of what kinds of developments may be patentable, if they meet the other requirements of the law, can be acquired by indicating some of the things that are not patentable. Unpatentable subject matter includes: plans for doing business, business forms, perpetual motion machines, promotional advertising schemes, intended results of desired goals, functions (without ap­paratus), nebulous concepts or ideas, and laws of nature (as distinguished from applications of such laws).

Regardless of the type of invention for which a patent is sought, there are three general requirements for patentability which are criti­cally important. A patentable invention must be new, useful and unobvious. The new and useful requirements are easily understood. The unobvious requirement is more difficult. The section of the statute involved (35 U.S.C. § 103) states it this way:

A patent may not be obtained ... if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains.

To determine the "obviousness" of a discovery, one must first identify the prior art. Locating the most pertinent prior art is not easy in view of widespread technological activity around the world. As a practical matter, one can never be positively certain of having located the most pertinent prior art in view of the abundance of technical knowledge and publications. However, any determination of patent­ability must be based upon some known prior art. With the known prior art in mind, patentability is determined by asking whether or not the invention would have been obvious to a person of ordinary skill in the field, who is aware of that prior art. To be patentable, an invention must differ from the prior art in a way that is not just an ob­vious change or addition. In considering the question, people may disagree on the abilities expected of the fictitious "person of ordinary skill," or on the content of the prior art, or on the conclusion that the imaginary person would reach. Any such disagreement is likely to result in a disagreement on the patentability of the invention in ques­tion. It remains an open question until decided by the court of last resort.

Other general requirements for patentability are that the inven­tion must not be frivolous or contrary to public policy or to the public welfare.

 Top

WHO MAY OBTAIN A PATENT?

Patents are granted only to certain individuals. Who are such per­sons? Only the first and original inventor (or those asserting his rights) can properly obtain a U.S. patent. A person who merely recognizes the commercial merits of an existing product, or who dis­covers it in an ancient document or in a foreign country may not prop­erly receive a patent; he must have invented it himself. A corporation or business organization may not pursue patent protection on a development independently of the inventor. However, it is common prac­tice for employed inventors to assign patent rights to their employers. Many employers make assignment a condition of employment.

The law recognizes that an invention may be made by one, two, or a greater number of persons. Accordingly, patent applications fre­quently name joint inventors. Problems may arise in this situation but the problems can be solved. Specifically, unless there is an agreement or assignment of the patent to one of the inventors or to a third party, each inventor has the right to exploit the invention with no duty to ac­count to the other inventor or inventors for his actions. This is true regardless of the percentage of the patent any one joint inventor may own. Worse yet, no one of the joint inventors has the right to exclude the others from practicing the patented invention due to the power of the other joint inventor or inventors to use the invention and grant licenses to others. Clearly then, the rights and obligations of joint in­ventors should be defined by an agreement or the patent should be assigned to a single entity.

Occasionally, it happens that two or more independent inven­tors come up with the same invention at about the same time. So, who gets the patent? The Patent and Trademark Office has a mechanism to resolve the issue, which is an "interference" proceeding. In such a proceeding the question of who is the first, true and original inventor is determined, for only that inventor (or group of inventors) may obtain the patent. It is not necessarily the inventor who first filed a patent application who obtains the patent. While the first applicant has a distinct advantage in the contest, he may lose out to another in­ventor who has records that prove him to be the earlier inventor, dili­gent in his development effort. Determining the winner of an in­terference involves resolution of complex factual and legal issues. For present purposes, suffice it to say that witnessed records covering the development of an invention are important, as is diligent activity and an early filing date for the patent application. This brings up the im­portance of timing in obtaining a patent.

Top

WHEN MAY ONE APPLY FOR A PATENT?

Time is important both as it relates to the activities of the inventor and the discoveries of others. Considering the possible history in the discovery of the wheel may help explain some of the time limits for patentability.

Initially, the first inventor of the wheel may have merely recog­nized the problems associated with moving large loads on rolling logs (the prior art). With only the recognition of the need for a better structure, a patent application would not yet be timely; a patentable invention had not yet been made. A patent application is not proper until a working form of an invention has been fully conceived. At a time when the complete invention is mentally pictured, that is, fully conceived in an operating form, the inventor may properly pursue patent protection.

Continuing with the example, quite independently of any effort to obtain patent protection on the wheel, the inventor might have published a description of his invention or he may have built a wagon and gone into the moving business. Such activities would raise another question of timing. A patent application must be filed within one year after the invention first is described in any publication, placed on sale, sold, or used publicly. The general rule is based on the philosophy that the inventor abandons his patent rights if he does not file a proper patent application within one year from disclosure or commercial activity with respect to the invention or discovery. Typical of the law, there are exceptions to the rule, as in the case of legitimate experimental use to perfect or develop the invention.

As another timing consideration, any publication or public use of an invention that takes place before the filing of an application in the United States may block the inventor from obtaining a valid patent in some foreign countries, most of which do not provide the one-year period of grace we have in the United States.

An inventor may keep his invention secret for a long time and still obtain a patent. However, a long delay in applying for a patent may result in the loss of all patent rights, which may go to a second independent inventor who acts more promptly.

Generally, it is wise to keep careful records of the invention and its development, which should be signed by a witness, and to file an application for a patent at the earliest practical time, preferably before any public description, or commercial development or public use of the invention.

Top

 

HOW TO OBTAIN A PATENT

The steps involved in obtaining a patent include: preparing a disclo­sure of the invention; conducting a patentability search on the inven­tion; preparing and filing a formal patent application in the U.S. Patent and Trademark Office; prosecuting the application in the office; and, finally, issuing the patent.

The inventor may obtain a patent without the assistance of a patent lawyer or agent if he wishes. However, ordinarily this is an unwise course of action. Patent law and procedure are complex and valuable legal rights that can easily be lost if the patent application and prosecution of that application are not handled carefully by one skilled in such matters.

Patent lawyers and patent agents who are registered to practice before the Patent and Trademark Office may prepare and prosecute patent applications. Patent agents are not lawyers and cannot pro­vide legal advice and assistance beyond preparing and prosecuting patent applications. In order to be registered, patent lawyers and agents must take and pass an examination given by the Office. A roster of patent lawyers and agents registered to practice before the U. S. Patent and Trademark Office, listing the individuals alphabet­ically, is available at a nominal cost from the Superintendent of Documents, U.S. Government Printing Office, Washington, D.C. 20402.

The major cost of obtaining a patent is the lawyer's charges. Or­dinarily this will be based upon the amount of lawyer time involved in preparing and in prosecuting the application. Of course different patent lawyers may charge different fees and some lawyers may con­sent to preparing a patent application for a flat fee after they suffi­ciently understand what the invention is and basically what the prep­aration of the application will entail. In any case, an inventor should not be hesitant about inquiring of the lawyer what his estimate might be as to the total fees in obtaining the patent if the patent is prose­cuted through the Patent and Trademark Office in a fairly routine way. He will also advise the inventor of problems that could arise in the Patent and Trademark Office prosecution which could necessitate significantly greater costs, such as an appeal or an in­terference.

PREPARE A DISCLOSURE OF THE INVENTION

Lawyers charge for their time and patent lawyers are no exception. Therefore, an inventor can save a great deal of time and money by making the lawyer's job easier. A few hours spent by the inventor at the beginning may result in hundreds of dollars of savings and a better application in the end.

It is relatively easy for the typical inventor to organize his mate­rials, and the inventor can help his patent lawyer by preparing a writ­ten description, drawings, and perhaps a model, if practical. At a minimum, the disclosure should include a description of known rele­vant prior art inventions and a detailed description of the best mode of practicing the invention. If there are some likely alternative em­bodiments of the invention, those should be described also. The in­ventor does not have to detail each and every remotely possibly em­bodiment, but describing alternatives or modifications helps the lawyer to draft claims adequate to provide good protection for the in­vention. The disclosure should be clear. It is not necessary that it be typewritten. A legible, carefully handwritten disclosure is adequate.

A good disclosure is not necessarily long. If the inventor isn't sure whether something should be included in the disclosure, he should put it in and let the patent lawyer decide whether or not to make it part of the patent application. If the inventor has relevant prior art documents, copies of these should be provided to his lawyer along with a description of their possible relevance to the new invention. Drawings prepared by the inventor should be clear and sufficiently detailed. It is good practice for the inventor to number the various parts of the invention and to key the number in with the written dis­closure. If alternative embodiments of the invention are described in the disclosure, then drawings should be submitted illustrating them.

If a model of the invention exists, it should be shown to the pa­tent lawyer. If this is not practical, photographs of the model may be used. Above all, conceal nothing from your lawyer. You can only lose by doing so. Concealing facts may result in his getting you an invalid or unenforceable patent at your expense.

Top

 

CONDUCT A PATENTABILITY SEARCH

Perhaps the most accessible and complete library of prior art is housed in the U.S. Patent and Trademark Office. The public is ad­mitted to this library or "search room"; however, it is used primarily by professionals. Patent lawyers not in the Washington, D.C. area in­variably have Washington, D.C. associates who make various types of patent searches and who obtain other types of information from the Patent and Trademark Office.

In general, the cost of a patent search depends on the time it re­quires. For example, a preliminary novelty search to locate the most accessible prior art for an evaluation of patentability certainly does not justify the time expenditure of a search for questioning the valid­ity of an important high-income patent. In some instances it may be practical to forego a search before filing a patent application. For example, if the subject matter is difficult to search, or the product has been scheduled for production, or the inventor has a keen knowledge of the prior art, it may be prudent to forego a preliminary search.

If a search reveals that the invention is not patentable, then the cost of filing an application will be saved. If the search reveals that the invention may be patentable, the references located in the search can be used to provide useful background information and indicate the possible scope of potential patent claims.

PREPARE AND FILE THE PATENT APPLICATION

A patent application is the document filed in the Patent and Trade­mark Office for the purpose of obtaining a patent. Since there are sig­nificant limitations on making changes in the application after it is filed in the Patent and Trademark Office-a strict rule against "new matter"-it should be prepared with care. Both the inventor and attorney have legal obligations to insure that the various parts of the application are. correct and, to the best of their knowledge, are not misleading.

It is not necessary to construct a working model before filing a patent application. However, the effective preparation of that docu­ment is a demanding project requiring full knowledge of a completely conceived invention. The patent application must disclose the best mode contemplated by the inventor for practicing the invention. Also, there is a duty to disclose all knowledge of pertinent prior art. That is, as part of the application, the inventor must sign an oath or declaration stating he has revealed all known pertinent information. The patent application provides the foundation for defining the proper scope of patent protection that is to be granted.

The main parts of an application are a background and prior art discussion, drawings (if necessary) to aid in understanding the de­scription, a detailed description of the invention, and the claims. In the background and prior art discussion, problems or shortcomings that have been experienced in practices or products known in the prior art are described.

Many patent applications include drawings as part of the inven­tion description, usually to illustrate the best embodiment of the in­vention. Patent applications on chemical compositions are a noted exception to that practice. The drawings of a patent application must conform to established standards and are made by professional draftsmen. The style and technique for the drawings are quite dif­ferent from the formats used in industry. As a consequence, patent drawings are made by specialists who work under the direction of the lawyer and are familiar with the requirements of the Office.

The written description of the invention, usually called the "spe­cification," must include adequate technical information, taken with the drawings. to permit one having ordinary skill in the art to carry out the invention. Details about every part of the invention may not be required as long as such details are well known or consist of stan­dard, commercially available parts. The written description should include alternatives and equivalent structures which will also work in the invention.

While claims are placed last in the patent application, their im­portance is first, since perfection in the rest of the application will be of little value if the claims do not properly cover the invention. This is not to say that there may not be remedies for imperfect claims under the right circumstances, but it is important that properly written claims of appropriate scope be present in the application. Most of the prosecution is devoted to having the claims written in acceptable form.

Usually, the most effective patent application results from a joint effort between an inventor and his patent lawyer. Of course, there.are exceptions and it is possible for a person to act on his own behalf without a lawyer. When an application is prepared by a lawyer working with the inventor, there should be total communication. Specifically, it is important that the lawyer be given all the relevant in­formation for the job. The preparation of a patent application can be compared to making a cake. Considerable assistance can be given to a cook by premeasuring the ingredients, laying out the tools, and preparing the oven; but usually it is best for the cook to mix the ingre­dients. Somewhat similarly, in the preparation of a patent applica­tion, the inventor should provide the information but allow the lawyer to compose and draft the complex document. Drawings, photo­graphs, written material, and oral discussions all may be helpful to educate the lawyer, depending on individual circumstances. Patent applications on complex subject matter normally should include at least one meeting between inventor and lawyer.

After a draft of the application is prepared, the lawyer requests the inventor to review it carefully to determine if there are corrections or changes to be made before it is placed in its final form for execution and filing in the Patent and Trademark Office. The formal papers (petition, oath or declaration, power of attorney) are prepared for the inventor's signature, or execution. The complete application signed by the inventor is then sent or delivered to the Patent and Trademark Office along with the appropriate filing fee. Once the application is on file, the invention, if marketed, may be marked with the notice "patent pending," although the right to prohibit use of the invention by others does not mature until the patent is granted. Use of that notice before filing is illegal.

A patent application is not to be confused with the mere filing of disclosure documents in the Patent and Trademark Office, a practice instituted several years ago which has led to some confusion. Under that practice, the Office merely acts as a recordkeeper with respect to these documents, taking no further action. Such documents will be discussed later.

Top

 

PROSECUTION OF THE PATENT APPLICATION

Patent applications filed in the Patent and Trademark Office are given serial numbers in chronological sequence. The filing date is also part of the identification for an application. That date may become very important, for example, should the application become involved in an interference.

Within the Patent and Trademark Office, patent applications are assigned to examiners with specialized technical expertise. The examination of applications normally occurs in the order in which they are received by the examiner. Every effort is made by the Office to attain a uniform and fair treatment of patent applications; how­ever, communications with the Office must meet certain standards and formalities.

In a typical case, the patent examiner first reviews the patent ap­plication for compliance with formal requirements. Then he consid­ers the invention as claimed. With an understanding of the claimed invention, he researches earlier patents and publications (the prior art) to determine whether the claims of the patent application define subject matter that is patentable over the prior art. Traditionally, ex­aminers are conservative, if not skeptical, in recognizing patentable subject matter. After determining his position, the examiner pre­pares a report or Examiner's Action, stating his position for commu­nication to the patent applicant. Usually, few if any claims are allowed in the first Office Action.

If the applicant has a patent lawyer, the Office Action is mailed directly, and only, to the lawyer. He will then advise the inventor of the Action and request the inventor's assistance and instructions for responding to the examiner's position. For example, the inventor may be asked to review the prior art cited by the examiner and express his resulting opinions. The applicant is given a time period for re­sponding to the Office Action. The response might take the form of an argument seeking to change the examiner's position, with or with­out an amendment modifying the claims of the patent application.

After receiving the response to his Office Action, the examiner again considers the case and reviews his position. Although the mat­ter may not be concluded at that stage, there are usually no more than two or three actions and responses before the question of patentabil­ity of the claims is resolved. Of course, the examiner may determine that the application simply is not directed to a patentable invention. Alternatively, he may recognize the existence of a patentable inven­tion and agree with the form and scope of the claims. A greater possi­bility is that the examiner concedes the invention to be patentable but disagrees with the lawyer on the scope of the claims which should be granted. Failing an agreement on any aspect, an appeal can be pur­sued. However, frequently agreement is reached whereupon the pa­tent application is ready to mature into, or "issue," as a patent. A "notice of allowance" results.

 

ISSUANCE OF THE PATENT

After the "notice of allowance" is issued, a "final fee" must be paid. About three or four months after payment of the final fee, the patent issues. From filing to issue, the average time a patent application is pending is more than eighteen months.

By long tradition, patents are always issued on a Tuesday. Also on Tuesday of each week, the Office publishes the Official Gazette abstracting all of the patents issued on that day. Patents are issued in numerical order.

The original of the patent will be sent to the lawyer who then for­wards it to the inventor or his assignee. Additional copies of the pa­tent may be obtained from the Office for a fee, but the original patent is an important document which should be kept with other, similarly important and valuable papers.

The issuance of a U.S. patent puts the inventor in the company of Edison, Ford, and the Wright brothers, and other inventors who have held U.S. patents for their inventions and is an occasion that rightfully brings respect and admiration to the inventor. At the same time, the public benefits by having the inventor's disclosure of his new and useful discovery.

 

EXPLOITATION OF PATENTS

The need for creativity does not end with the issuance of a patent. Whether the inventor seeks to license his development or directly market the resulting product, success usually requires an innovative and intense effort. The process is likely to be difficult and chances for success are statistically poor. This is true for the established business­man as well as the unknown independent inventor. The mere avail­ability of the basis for a new product, even an exciting one, may not stimulate much interest from serious investors or purchasers. De­velop credibility, use imagination, and make the effort. Thousands have been successful, but rarely without initial setbacks and disap­pointments.

Because of the difficulties in marketing new inventions, inde­pendent inventors have sometimes turned to promoters for help. These promoters have variously identified themselves, for example, as invention developers, idea brokers, and technology or marketing consultants. Unfortunately, many invention promoters offering ser­vices to independent inventors have preyed on the unwary, making promises which they are incapable of keeping, then charging exorbi­tant fees. Financial loss and heartbreak have taught many inventors, dealing with unscrupulous promoters, the lesson of caution.

Patent licensing offers a variety of possibilities. A license can be limited to a single company (exclusive) or nonexclusive licenses can be granted to several companies. Other aspects of licensing include the responsibility for enforcement, conditions of termination, foreign rights, related trade secrets, know-how, and the very important roy­alty payment. Licenses are common which provide for either:

1. a single lump-sum royalty payment;

     2. a royalty of a specified amount for each product produced

under the license; or

      3. a royalty in the form of a percentage of the receipts from the

sale of the licensed subject matter.

Although royalty percentage rates are the most common form of license payments, the rates vary widely from fractional percentages to double-digit percent figures, depending on the nature of the in­dustry, production costs, the significance of the invention, and so on.

There are prohibitions on licensing, violation of which can amount to patent misuse or antitrust violations. For example, a li­censor should not fix prices, require the purchase of unpatented products from him, regulate the use of the patented product, or re­quire royalty payments beyond the life of the patent. Again, the law in this area is complex so the objective here is merely to indicate the pos­sibility of danger. Similarly, a patent holder should be aware that the details of a license can have profound consequences on the tax as­pects of royalty payments.  Patents may also be sold outright.

ENFORCEMENT OF PATENTS

Many conflicts involving patents are settled by negotiation. Failing the settlement of a conflict, suit may be brought in a federal district court located where the infringer resides or where infringement oc­curs and the infringer has a regular and established place of business. The objectives are usually damages (as from loss of sales or royalties) and an injunction against further infringement.

It is also possible for an alleged infringer to initiate legal action to attack your patent. This usually happens after you have charged him with infringement. Usually in patent litigation, the rights granted to the patentee are reviewed and the infringement of such rights is deter­mined.

The ultimate infringement suit is a very involved and expensive proceeding that may take several years. Pretrial procedures are lib­eral in allowing the parties to obtain very detailed information from each other. Perhaps as a result, high percentages of such cases are settled and recent experiments with novel settlement procedures have been encouraging.