When it comes to marketing a new product, the more avenues of protection, the better. Winning products are those which can use all of the available forms of protection. These include:
• Proper records kept in a bound notebook and signed by the inventor and witnesses
• A disclosure document filed with the U.S. Patent Office
• Trade secrets as to methods of production
• Trade secrets as to contents
• A utility patent to cover its functions
• A design patent to cover its overall shape
• A trademarkable name and logo
• Copyrights on written procedures, plans, instruction books, safety and test results, artwork, etc.
• Foreign patents, trademarks, etc. in countries you plan to trade with
• A licensing agreement for unpatentable "know-how" and "intellectual property"
Beginning product developers focus much of their energy on patents and the patent process, so I'll begin this series there.
PATENTS
The following is my opinion, based on my years of working with my clients, their questions and my own experience with inventing, marketing and licensing my own products. Keep in mind that I am NOT a patent attorney.
As far as the patent office is concerned, the primary purpose of a patent, and one which many innovators are unaware of, is to disclose the intellectual property, thus informing and teaching the public in order to build on that knowledge and further economic growth. A patent grants certain rights of restriction to the inventor in return for the disclosure of the invention to the public.
A PATENT IS NOT A RIGHT TO SUCCESS, A RIGHT TO MANUFACTURE, OR EVEN A RIGHT TO USE. Basically, it's the right to prevent someone else from practicing your invention without compensating you, for the term of the patent.
Most of my clients, who have not yet filed for a patent, ask me how to decide whether to file a patent or to proceed without one. The answer? You should always do a "cost versus benefit" analysis to determine whether or not to file a patent. Once you've established how many people are likely to buy your product during its life cycle and have a good idea what the wholesale price will be, take the number of prospective buyers times the wholesale price, times three percent (an average royalty figure) and you'll have a rough estimate of your possible income from the product.
The number you come up with had better well exceed the cost of the patent. It is then up to you to decide whether you should file for a patent on your product or technology. That's why you should evaluate an idea carefully BEFORE seeing a patent attorney. The great Will Rodgers once said, "I never met a man I didn't like." Many patent attorneys have a motto, "I never met an idea I didn't like."The reason for that is they get paid well for every patent they file and it really doesn't matter to some of them whether you make any money or not.
In fact, the real sleezeballs will file for patents on ideas that THEY KNOW HAVE NO CHANCE OF COMMERCIAL SUCCESS just so they can make their patent fees. Good, reputable patent attorneys won't do that and will instead suggest that you not file a patent for an idea which appears to be flaky.
The bottom line, of course, is that it's really YOUR responsibility to decide whether to file or not. In my years of consulting to inventors, I have personally seen many patents issued that would never have a chance at commercial success. YOU must take the initiative, objectively evaluate your ideas and file for patents on only those ideas that have a good potential for success
Patents should not be considered goals in themselves. Inventors have a tendency to think of the patent as a "badge of achievement," but the real measure of achievement is money in the bank. That is why I like to think of the patent as a marketing tool.
Remember: Filing for and purchasing a patent gives you ONLY the right to preclude someone else from making your product without compensating you. THE PATENT ITSELF DOES NOT PROTECT YOU FROM ANYTHING. IT DOES NOT STOP ANYONE FROM MAKING YOUR PRODUCT. IT MERELY GIVES YOU A LICENSE TO SPEND YOUR OWN MONEY TRYING TO PREVENT AN ALLEGED INFRINGER FROM MAKING YOUR PRODUCT WITHOUT PAYING YOU.
Here's an analogy I like to use:
When you obtain a patent, you obtain a handgun to use against infringers. The problem is, you're given an EMPTY handgun. You still need bullets and you need gunpowder. The bullet is your attorney and the gunpowder is your money.
If you have a skilled attorney or law firm, you have an armor-piercing bullet. If you have a mismatched or less than skilled attorney, you have a rubber bullet. A well-written patent by a skilled attorney adds value to the invention, while a poorly-written patent by a less-than-skilled attorney is basically worthless in court.
RIORDAN'S LAW--Never take a less-than-skilled lawyer to a skilled-lawyer fight.
Seek out skilled patent attorneys and be sure their skills and specialties match the invention's requirements. You should always ask to see their references or patents they have completed on products which are similar (or apply to) your product. If an attorney tells you, "That's confidential," you should say, "Baloney--all issued patents are in the public domain." If they still won't produce patents for you to review, you probably have the wrong attorney and you should look elsewhere.
Now for the gunpowder. If you have a lot of money, you have a lot of gunpowder and vice-versa.
RIORDAN'S LAW--Never take a small quantity of gunpowder (money) to a skilled lawyer fight.
Ideally, with an armor-piercing bullet and lots of gunpowder, you can take a shot at your infringer and make him bleed dollars. Beware, however, of the rubber bullet/little gunpowder combination. Usually this means there's just enough powder to push the rubber bullet out of the barrel onto the floor where it "grovels about smartly" until its energy is spent. In other words, nothing happens, you lose, and the little money you did have is gone).
IN THE PATENT GAME, YOU GET ONLY AS MUCH PROTECTION AS YOU CAN AFFORD. As a result, a patent becomes powerful protection in the hands of a large, well-funded company. However, the same patent may be almost useless as a "real world" form of protection for an individual or small business person. The "little guy" may have to cough up between $15,000 to $25,000 in "gunpowder" to "take the first shot" with the handgun he has purchased.
For this reason, the small business person must regard a patent not so much as a form of real protection, but rather as a "bluffing tool." Like pointing an empty handgun at a burglar to scare him away.
Sometimes it works, sometimes it doesn't.
NEXT ISSUE: More on Patents
The above article was taken from James F. Riordan's classic book, HOW TO EVALUATE THE POTENTIAL FOR SUCCESS OF A NEW PRODUCT OR TECHNOLOGY. Riordan's highly-acclaimed, 36-point system is a valuable tool for inventors, product evaluators or anyone interested in the invention process. Each section is followed by a comprehensive questionnaire that can be used to evaluate your product.
The highly-recommended book can be ordered by contacting the James F. Riordan Company, 3110 Camerosa Circle, Cameron Park, CA 95682. The company can be reached by phone at (916) 676-4729. The book may also be ordered through Dream Merchant, 2309 Torrance Blvd., Suite 104, Torrance, CA 90501. The phone number is (310) 328-1925.
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