Q: As the owner of an automotive company, I invented
mechanical devices and created improvements to enhance race car
performance--many of which are now commonly used in the industry
(none were patented). Though I'm now retired, I continue to
create inventions in a variety of product categories. What steps
should I take to find out if any are marketable? Should I see a
patent attorney? I'm looking for legitimate channels to get a
concept to market.
A.M. Davis
Oxnard, CA
A: Ted De Boer is founder and president of Inventors
Assistance League International Inc. (IAL) in Glendale, California,
and a patent attorney:
You're not alone; most
inventors don't know where to go for help. They rush to a
patent attorney, unaware of the other methods available to them for
protection. They prematurely disclose the secret of their
invention. Or worse, they forfeit their idea and their savings to
unscrupulous operators. All this without an inkling of whether the
idea had any commercial value in the first place.
These problems inspired the formation of IAL, a nonprofit
educational/scientific charitable organization, which offers a
program that teaches inventors how to get their ideas in the
manufacturer's door and determine their marketability. It's
a process I call "pre-patent protection" that hopefully
leads to obtaining a preliminary royalty agreement. If you enter
into an agreement with a company, it's pretty certain your
invention has commercial value. But how do you get there?
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1. Learn the rules of the game. By doing so, you keep
your secret safe. You avoid paying upfront fees to unscrupulous
operators--who scam $250 million a year from unsuspecting
inventors--or applying for a patent prematurely. You simply
cannot disclose the secret of your invention to anyone
without operating under controlled conditions.
2. Protect your idea under the First-to-Invent provision.
You need to protect your idea before you attempt to market it. Of
course, a patent is a necessary legal document--at the right time.
Just as a pink slip on a car is useful only if the car is
driveable, a patent is necessary only if the invention is going to
market. Before you disclose your idea to a manufacturer, protect it
under the First-to-Invent provision of patent law--a rule every
corporate research and development department plays by.
Because they don't benefit from doing so, patent attorneys
are not quick to divulge this First-to-Invent provision to their
clients, even though it's been on the books in the United
States since 1790. This provision provides a way to establish
"priority as defined by patent law"--simply put, it gives
your idea a priority date, which legally establishes when an
invention is created and by whom. It's almost like
patent-pending status. However, you can't just slap a
patent-pending label on your idea and go out selling. Protection is
only 2 percent of your problem. The idea is 8 percent, and
marketing is 90.
3. Discover your idea's commercial value.
Corporations know how to evaluate the commercial value of their
inventions--in a secret manner the First-to-Invent provision
allows. At IAL, we coach inventors on how to follow big
business's example by presenting an idea without giving its
secret away. In your quest to determine commercial value, the first
clue is a manufacturer's interest in the concept. Receiving a
first and second interview with an executive is a sure sign the
manufacturer perceives the invention to have potential commercial
value. If you get to the preliminary financial arrangement stage,
the process of finding a place to license your invention is well
underway. Let's look a little closer at this all-important
interview process:
*Walk into an interview prepared. If you've pitched
your idea to a manufacturing company and have been granted an
interview, research the company and its product line. Then sell the
executive on what the product can do, not on how it's
engineered or designed.
This way of selling a concept protects your idea and allows the
executive to better imagine how the invention might fit into the
company's product line. At IAL, we used to help the inventor
create a model to display at the interview. But we found that if
the model didn't look just as the executive envisioned it, the
idea would get shot down. Most executives are more interested in a
product's benefits and profitability than in how it works.
After all, it's their company that may license, design, make
and market this new product.
*Move toward a preliminary financial arrangement. If the
executive shows interest, suggest meeting again a week later to
discuss a preliminary financial arrangement that clearly defines
how you can work together. Go over the agreement line by line on
such issues as legal ownership, sub-licensing, infringement,
arbitration, minimum royalties, the company's exclusive license
for U.S. and foreign markets, minimum royalties, and advance
royalties, which will help pay for the international patent
application. Include statements that both parties will agree to
conduct themselves so that patents can be obtained in all
countries, that both parties understand this is a preliminary
financial arrangement only (not a binding contract) and that either
party can ask for revisions.
4. Find out what your options are. Don't put all your
eggs in one basket. Approach several companies with your idea and
get bids. This way you'll learn what your options are, your
idea's commercial value, and who the right executives and
companies are who can help. Only when you know what your options
are can you decide to license with a company or to make and market
the invention yourself. As I hinted at earlier, if you go with a
manufacturer, your earnings under the royalty agreement will pay
for the international patent application.
5. Let the manufacturer file the patent application.
Licensed companies know when to file and when to market.
6. Understand the patent process. Any inventor who
attempts to go through the patent process without using a
manufacturer should first query a patent attorney by phone. Ask
about hourly rates; the cost to conduct a search in the patent
office; the cost to write and file a utility patent; the cost to
put the patent application in the order the examiner wants and will
allow; the cost to write amendments; how much the patent office
charges to issue a patent; and what the maintenance fees (taxes)
will be over the years to keep the patent in force.
These maintenance fees are no small matter, considering
amendments are written three to four times over a number of years
to obtain the broadest coverage the law allows . . . and about 40
percent of inventors can't afford to pay these rising fees.
7. Get smart, not discouraged. If you get discouraged and
feel that only the big guys get their inventions to market anymore,
remember this:
73 percent of the revolutionary inventions that started new
industries were created by independent inventors. The automatic
transmission, jet engine, color photography and penicillin
weren't invented by their respective industries--they were
conceived by independent inventors like you. Pursue your dreams,
but always abide by these rules. And take advantage of the legal
provisions available to you.
Contact Source
Inventors Assistance League International Inc., 403 S.
Central Ave., Ste. A, Glendale, CA 91204, http://www.inventions.org