1. Why do entrepreneurs need to protect their technical and scientific innovations?
If you start a grocery store, you probably are not selling a technical or scientific innovation, so your goal is to execute better than the grocery store down the street. You likely will compete on price, quality, and service. Businesses that develop technical and scientific innovations, such as Tesla, Apple, and Novartis, as well as startups, spend enormous sums of time and capital developing the next big thing. These companies directly capitalize on that innovation. Ideally, nobody other than the entrepreneur who developed that innovation can commercialize it, giving the entrepreneur the exclusive right to own and potentially build the protected market/product. Think of it another way—why spend all this time and effort to move the market forward just to let a competitor use it…and reap the benefits of your hard work!
Indeed, parties looking to acquire an innovative company (or analysts for an IPO) take a hard look at whether the technical and scientific innovation of that company is adequately protected. Unfortunately, poorly protected innovation can kill enterprise value and even kill a deal. Venture capitalists, private equity, angel investors, and others will make similar analyses because they strive for a positive return on their investments through an acquisition or IPO.
Updated August 3, 2020
The coronavirus seems to be exerting itself upon all phases of life, and your intellectual property is not immune. While you, your families, your friends, and your colleagues are getting comfortable with the new normal of social-distancing, intellectual property (IP) offices worldwide have also been grappling with how to handle the impact of coronavirus (also referred to as COVID-19). Responses from IP offices around the world are varied and evolving, as the landscape changes in each individual country and on a global scale. For example, some offices, such as the European Patent Office (EPO), India, and the United Kingdom, have automatically extended deadlines, while others have refrained from any extensions but permit, under certain circumstances, remedial action for rights lost due to effects of the coronavirus. While the U.S. Patent and Trademark Office (USPTO) has not provided for automatic extensions, certain deadlines associated with patent and trademark filings and fees may be extended for small and micro entities provided the delay in filing or payment was due to the COVID-19 outbreak. Additionally, the USPTO will waive the petition fee to revive certain lost rights resulting from a failure to take action due to effects of the coronavirus.
Building upon our recent note concerning general international intellectual property protection considerations, this article describes how foreign IP expansion efforts might play out in a case study format. The company, a hair restoration lotion manufacturer named WonderFlo Tonight, is fictional, but the fact pattern is derived from real world situations encountered by businesses as they seek to establish and protect their intellectual property in foreign markets.
In recognition of the high interest level in the program, the PTO recently announced it is increasing the annual limit on Track One Prioritized Examinations from 10,000 to 12,000, effective September 3, 2019, to prevent exceeding the limit this fiscal year, which concludes on September 30. 12,000 will be the new limit going forward as well.
As the 2018-2019 Supreme Court term nears its end, several consequential patent law petitions still await certiorari rulings before the Justices recess for the summer, while other patent cases are scheduled to be briefed and ready for oral argument when the Court reconvenes for a new term in October. To mark the end of this term, here’s a list of 5 Patent Law Petitions to Watch at the Supreme Court as we look ahead to 2019-2020.
On March 7, 2019, the Patent Trial and Appeal Board (PTAB) designated the decision in Lectrosonics, Inc. v. Zaxcom as precedential. The order provides guidance and information on practice surrounding a patent owner’s motion to amend during an Inter Partes Review (IPR), in light of Federal Circuit case law. Generally, in an IPR proceeding, the patent owner may file one motion to amend the patent to (a) cancel any challenged patent claim and (b) for each challenged claim, propose a reasonable number of substitute claims. 35 USC 316(d)(1). This decision replaces Western Digital Corp. v. SPEX Techs, Inc., and provides further guidance on the scope of proposed substitute claims and the right of a petitioner to submit evidence during the IPR amendment cycle.
Decisions by the Supreme Court and the Federal Circuit over the past decade have wrestled with the question that 35 U.S.C. §101 was intended to answer: What is eligible for patent protection? The text of §101 says a patent can be granted for “any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof.” Though this text has changed very little since it was first written in 1793, the courts have established a number of judicially created exceptions, and exceptions to those exceptions. This has created a growing difficulty and uncertainty in applying §101 to modern technologies, especially those implemented by computer systems.
Bob Dylan famously sang that “[y]ou don’t need a weatherman to know which way the wind blows,” and we don’t need a weatherman to tell us that the wind now blows differently at the United States Patent and Trademark Office (USPTO). On January 7, 2019, the USPTO released revised subject matter eligibility examination guidance (“Guidance”), foreshadowed by USPTO Director Iancu last fall. The Guidance is noteworthy both for raising the bar in examination procedure and, we think, for signaling the Office’s intent to rein-in the application of subject matter ineligibility analysis (“lest it swallow all of patent law” – Alice). We anticipate a reduction in subject matter eligibility rejections because the Guidance makes it more difficult for examiners to reject claims as being directed to unpatentable subject matter under 35 U.S.C. §101.
On January 22, the Supreme Court clarified an important issue of patent law that had been left open since the enactment of the America Invents Act several years ago.
The patent laws bar a person from receiving a patent on an invention that was “on sale” before the effective filing date of the patent application claiming that invention. The Supreme Court had previously announced that the “on sale bar” came into effect when the invention was “the subject of a commercial offer for sale” and was “ready for patenting”—that is, it must be sufficiently developed that a patent application could be filed, and there must be a commercial offer for sale. If these conditions are met, the offer can bar a subsequent patent application. The appeals court confirmed that this is true even when the offer for sale was confidential.
Invention disclosures made by an inventor to an attorney, or a review committee including attorney(s), often contain sensitive information that a client would prefer to keep confidential. It is important for both inventors and attorneys to appreciate the boundaries of the attorney-client privilege, as applied to inventor-attorney communications, to determine which communications can be privileged, and thus sheltered from discovery, and those that will remain discoverable. As in other areas of law, the attorney-client privilege attaches to confidential communications between a client and an attorney made for the purpose of seeking legal advice or services. The Court of Appeals for the Federal Circuit (CAFC) has applied this principle to patent law and found that the privilege attaches to confidential invention disclosure communications between an inventor and an attorney made for (1) seeking advice on patentability or (2) for obtaining legal services of preparing a patent application. See In re Spalding Sports Worldwide, Inc., (Fed. Cir. 2000). Thus, the attorney-client privilege attaches to invention disclosures submitted or communicated to an attorney to assist the attorney in evaluating patentability or in prosecuting a patent. Additional inventor-attorney communications which may fall within the attorney-client privilege include draft patent applications prepared for or received by an attorney and communications between a named inventor and a patent attorney about patent prosecution.
Maximizing the protection and value of intellectual property assets is often the cornerstone of a business's success and even survival. In this blog, Nutter's Intellectual Property attorneys provide news updates and practical tips in patent portfolio development, IP litigation, trademarks, copyrights, trade secrets and licensing.