Should Management Be Involved In Patenting Decisions?
by Clifford D. Hyra on Patents101
I always recommend that businesses not isolate management from the patenting process. Sometimes companies leave the patenting to the R&D department, figuring that they know their inventions better than anyone in management would.
The problem is that R&D may not know or always be cognizant of the overall goals and strategy of the business the way management is. And what sometimes happens when the R&D department takes over the patenting process is that they lose sight of the truly important aspects of the inventions, leading to patents that cover products, and not innovations.
You may be used to people referring to a product and saying “that’s patented.” But, while products can be covered by patents, a patent should generally not protect a single product alone. A patent should protect your innovation. If you invent a new lamp, your patent claims should not just describe as your invention the exact lamp you plan to make and sell.
Rather, it should capture the full scope of your innovation- what is it about your lamp that is new and better than other lamps? Your patent should ideally cover any new product including your innovation, not just the particular one you want to sell or have in mind.
Jackie Hutter has written a good article emphasizing the importance of properly defining the scope of your innovation- and of getting management involved in the patenting process to make sure that happens.
A SVP at a large consumer products company recently expressed frustration that he cannot bring a patent infringement lawsuit even when his company holds 18 US patents (and many other foreign patents) on a product that closely resembles a competitor’s product… The competitor’s knock-off product has been successful because they have removed much of the cost from the product by using less expensive ingredients, while still being able to maintain its desirable performance aspects…
So why can’t the SVP go after the competitor by suing on one or more of the 18 US patents for which his company paid so dearly? Quite simply, the patents cover the INVENTION not the INNOVATION. The difference is subtle, but critical. The invention centered on the plastic composition of the product, that is, how much of each ingredient was present and how that composition manifested in the finished product. In contrast, the innovation centered on the performance of the product, irrespective of the plastic composition…
The reason for this situation is clear: the 18 US patents were prepared in a R & D/patent attorney “silo” where the “cool factor” was considered to be the attributes of the plastic composition, not the attributes of the final product…
After hearing my explanation for his frustration, the SVP wondered aloud how to learn from this costly patent lesson. I told him that the answer was easy: he must dismantle the patenting silo where his patent attorneys work only with his R & D team. Instead, his business team must drive the patenting process at his company by holding primary decision rights on what patent applications his company files and what those applications cover.
Management is sometimes better at keeping their eyes on the ball. The goal is to grow your business and make more money, not to accumulate patents. Jackie also endorses something I always recommend to my clients- a brainstorming session where you try to think of ways your competitors could knock off your product. The results of such an exercise can be a great help to a patent attorney in preparing your application with sufficient breadth to encompass the design-around attempts of your competitors.
By the way, this is another great illustration of the importance of relying on a good patent attorney. Claim/application scope is an art. If a large company with a big patent firm can make a mistake like this, just imagine what can happen when an inventor tries to put together an application on his or her own.
About the Author
Clifford D. Hyra, founder of Hyra IP, PLC based in Reston, VA, is a registered patent attorney with extensive experience in the intellectual property field. Located not far from the United States Patent and Trademark Office in Alexandria, Virginia, the firm specializes in intellectual property law, including patent prosecution in the mechanical, chemical, electrical, medical, computer software, biotech, and business method arts. Hyra IP is a national and international practice with a geographically and philosophically diverse portfolio of clients. Clifford has prosecuted hundreds of patent and trademark applications in the United States Patent and Trademark Office, negotiated the settlement of patent and trademark disputes, conducted trademark cancellation and opposition proceedings, appealed to the Court of Appeals for the Federal Circuit.
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Great post!
I think that you are absolutely right. Part of the problem, in my opinion, is that patents are still regarded as an administrative prerequisite that is to a large extent separated from corporate strategy. This may have been less of an issue in an industrial economy where one of the major functions of patents was to block competitors from entering your product space.
However, in knowledge-intensive industries such as biotech or IT where technologies are in focus - patents provide a creative function that enables value extraction through transactions. This means that patents (or rather IP rights in general) should instead be seen as vehicles to objectify intangible knowledge into something that can readily be transacted upon. This creative transformation can be seen in standardization initiatives, university spin-offs, venture incubators, and other open collaborations - all of which would have been more or less impossible without the transactions that patents have enabled.
It is time that companies recognize that IP strategy needs to be one of the focal points in the boardroom - not a back-office procedure.
Best regards,
Tobias Thornblad
Intangitopia.com
http://www.linkedin.com/in/tobiasthornblad