Many people, even those with significant experience with patents, harbour some misconceptions about the patent system, its advantages and risks. This article debunks a few of the more common mistakes.
Only Genius Ideas Can Be Patented
An invention need not be a genius idea to be patentable. An Australian standard patent (which provides 20 years’ protection) requires that the invention is “inventive” compared with what was known and published before the patent. A good way to think of an invention is as a solution to a problem. A solution is inventive if, at the date the patent was filed, the ordinary person working in the field would not have been directly led to try that solution with an expectation that it might well work. This is a relatively low bar to clear, and often allows patent protection to be obtained for relatively minor, incremental improvements over existing technology.
The bar for innovation patents (which provide 8 years’ protection) is lower. They require that the invention is “innovative”. A solution will be innovative if it is different from what was known and published before the patent in a way that makes a substantial contribution to the way the invention works. Provided the difference is relevant to the working of the invention, it does not matter how obvious that difference may have been.
As a result, an invention does not need to involve a quantum leap forward over, or a radical departure from, the existing technology. Many patents are granted for small changes to existing technology.
All Technology Should Be Patented
A patent is a great tool for protecting your intellectual property. But it is not the only tool available and is not always the best. There are instances where you may be better served by relying on keeping the technology secret (including by way of non-disclosure agreements with employees and other third parties). Alternatively, you might be better served by relying on your trade mark rights and reputation, design rights or copyright. Sometimes, it might be best to innovate so quickly that the competition simply cannot keep up with you. You should consider all of these strategies when deciding how to best protect your intellectual property.
I Can Stop an Infringer With a “Patent Pending”
A standard patent must be granted, and an innovation patent must be certified, by the Australian Patent Office before it can be enforced against an infringer. Both processes involve the Office reviewing the patent application carefully and considering whether there are any reasons that it might be invalid. Once the patent has been granted you, can pursue them for infringements that occurred before the patent was granted.
If I Obtain a Patent, I Have a Right to Use and Sell the Invention
A patent gives you the right to prevent others from using your invention. However, it does not guarantee that your invention will not infringe other parties’ patent rights. An earlier patent may stop you commercialising your technology even if you have a granted patent for it.
This situation can arise if a patent is granted for a product with additional advantageous features over an existing, patented product. If the existing patent is broad enough, it may well cover subsequent improvements. It may also arise where a patent is granted for a new way of using an existing patented product; again, the earlier patent might be broad enough to prevent all uses of the patented product, even if those uses were not mentioned in the earlier patent.
A Granted Patent Is a Valid Patent
A patent must comply with a number of requirements for it to be valid. It must be new and inventive (or innovative) compared with everything that was known and published before the patent was filed. It must be useful. It must not have been used in secret before the patent was filed. There are also other formality requirements surrounding the way the patent describes and claims the invention.
The Australian Patent Office does its best to search for information that was published before the patent’s filing date, but its limited resources may mean it does not identify all relevant publications. For example, the Office may be unable to search some academic and trade journals. Without identifying all relevant and publicly available information, the Office may not realise that the invention, or something very similar, was published before the patent was filed.
It may not be apparent from reading the patent that the invention will not work, or will not satisfy promises made in the patent. The Office may not know that the patentee secretly used the invention before filing the patent. Further, the validity of some patents involves complex technical and legal arguments, and a Court may take a different view to the Office.
Until a patent has been through the rigours of litigation, its validity cannot be assumed.
A Granted Patent Is a Valuable Patent
There are many reasons why a granted patent may hold little value. A patent may be invalid and thus effectively unenforceable. A patent may also be so narrow that it is easy for others to work around it, taking the advantages of the invention without infringing it. Technology may evolve and overtake the invention, such that there is no longer any market demand for a patented invention. The patented invention may not be able to compete with existing technologies for other reasons. There may be no market for the invention. A critical part of managing your patent portfolio is assessing the ongoing value of each of your patents to determine which should be retained and which should be allowed to lapse.
A Patent Can Only Be Commercialised by Monopoly and Litigation
A common way of commercialising a patent is to maintain a monopoly over the supply the patented goods and services, and charge customers a premium. If a competitor seeks to intrude on that monopoly, it may be tempting to immediately call in the litigation lawyers to protect that monopoly. However, this is only one way of capitalising on your patent rights.
Some patentees sell (“assign”) their patent rights. Other patentees profit by licensing out their technology to other parties and charge a royalty. This may provide a patentee with a regular, guaranteed income stream without them having to undertake any work. Alternatively, the patentee may supply one product or service to the market whilst licensing others (for a fee) to supply another product that does not compete directly. Patent rights may thus be used in a multitude of ways.
If a Patent Exists, I Can Not Use the Technology
If you plan on launching a new product or service, finding that it is covered by an existing patent does not automatically mean that you should shelve your plans. There may be ways of circumventing the patent issue. First, it may be possible to modify your technology in a way that avoids the patent whilst still taking the advantages. That modification may itself be patentable. Second, the patentee may be willing to license or sell its patent to you. The patentee may not have the capital, the expertise or the desire to commercialise the invention and be grateful for the opportunity to license or assign it to another party. Third, the patent may have invalidity issues that would discourage the patentee from taking any action against you. Fourth, and as a last resort, it may be possible to revoke the patent, clearing the path for you. All of these avenues be explored before taking the drastic step of discontinuing a lucrative new project.
A Patent Operates Throughout the Entire World
Each country has its own patent system, and a patent only applies in the country in which it was granted. When applying for a patent, it is important to consider your existing markets as well as your potential future markets. Once the time has passed for selecting your countries, it may not be possible to file the patent in any other countries, which may be a disaster if you subsequently find out that you have a lucrative market in a country but no patent protection there. If part of your manufacturing chain is based overseas, you should also consider whether it is prudent to seek patent protection in that country even if it is not one of your markets.
Conclusion
The patent system is full of complexity and nuance, and even experienced operators can fall into its many traps. However, when fully understood and properly utilised, it holds great potential for innovators.