It's OK to Look

Posted by Mark Brousseau

Companies pursue patents for a wide variety of reasons -- competitive advantage, company valuation, tax credits and others -- but in chasing patent claims, did you know that it actually benefits companies to look at patent applications filed by competitors, too?

That’s what one patent expert, attorney Roger Maxwell, believes. In his experience, searching competitors’ published patent applications and existing patents has actually helped his clients maximize their commercial advantages and follow the law.

“We can take a lesson from Hollywood,” he said. “Every aspiring screenwriter’s lament is that no producer will ever accept an unsolicited manuscript. There’s a reason for that. In copyright law, just as it almost always is in patent law, lack of intent is not a defense. In other words, if an agent or a producer even opens an unsolicited script, and 5 years later produces a film with elements from that script entirely by accident, they could be sued for copyright infringement. To prevent that, they simply don’t accept unsolicited material unless it comes from a licensed agent they trust.”

Maxwell says that the same principle can be applied for companies seeking patents, only in reverse. Whereas access in the copyright arena can lead to inadvertent copying and infringement, access in the patent area can lead to a better understanding of the state-of-the-art, better product design and better patents.

“It is very possible -- and even likely in some cases -- that one company’s patent may well duplicate elements from someone else’s application or existing patent,” Maxwell says.

“Because intent is not normally an issue, that company could actually be held liable for patent infringement, even if it didn’t know what the other company’s patents said. In the case of patents, it’s important to refrain from having your patent infringe on anyone else’s, even if it’s by accident,” he explains.

So they don’t waste time and money proving they are violating the law and/or setting themselves up to pay damages, it is critical for companies that are preparing patent applications to search published patent applications as well as existing patents, according to Maxwell.

“In examining other applications, a company can ensure that no elements of their applications cross over with something already on the books, even if it’s in an application filed by someone else,” he adds. “If you know what your competitors are working on with regard to their patents, as the public records afford you the capability to do, then you can work to not use any of their claimable technology in the pursuit of your own patent. That adds more weight to your claim and helps maintain the integrity of the system."

"The whole reason for patents is to recognize the proprietary ownership of a company’s intellectual property and to ensure unique ideas and executions of concepts can be protected. If a company finds a patent that it feels may arguably cover its products, it can further investigate the issue. If the investigation leads them to believe that their design does not infringe or the patent is not valid, an opinion from counsel may shield the company from enhanced damages that could triple the actual damages," Maxwell explains. "If the investigation reveals that the patent is valid and infringed the company can either redesign their product or negotiate either a license or a purchase of the patent."

"In my view, the best way to get a great patent is to check all available sources to make sure your application is verifiably unique and free from infringement of anyone else’s ideas already in the patent system,” Maxwell concludes.

What do you think?

Customers Drive Product Innovation

Posted by Mark Brousseau

Customers and in-house R&D teams are now the leading source of innovation for U.S. businesses, while globally customers are an organization's best source of innovation, according to new research from Grant Thornton International Ltd. When asked to name the origin of the best innovation ideas, U.S. business owners named customers (37%) and in house R&D teams (37%) as their leading sources of innovations followed by heads of business units (34%) and employees (32%). Globally, 41 percent of businesses say that customers are their leading source for innovation.

"In recent history the tech boom and the creation of internet social networking sites brought innovation and entrepreneurship into every American home," said Harris Smith, Grant Thornton LLP's managing partner for Private Equity and the Audit practice leader of the firm's Southern California offices. "Without entrepreneurs and innovation, America couldn't thrive."

Regionally the report reveals that in Asia Pacific customer focus is a particular source of innovative ideas and products with nearly half of businesses (48%) citing customers as the source of the best innovative ideas, compared with 40 percent in Western Europe and 35 percent in North America.

In addition, more than three in four businesses globally (78%) believe that the U.S. is the easiest country to create innovative products, services and business. The U.S. is the clear leader in this, with the next highest countries being China (22%), India (22%) and the U.K. (21%). Regionally, the U.S. is also seen as the leading country with 77 percent of Asian-Pacific businesses, 84 percent of North American businesses and 71 percent of European businesses saying it is the easiest country to create innovative products, services and business in.

"With the history of innovation in the U.S. spanning from the country's earliest beginnings, it's not hard to understand why businesses around the globe see America as the land of innovation," said Smith.