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IP, Patent

Patent Connections: New Year’s Patent Resolutions: Bulk Up Or Trim The Fat? A Humble Suggestion Is To Try Both

Yesterday my latest column over at Patent Calls, New Year’s Patent Resolutions, was posted, which dovetails somewhat with the provocative “Don’t File A Patent” discussion from a few days ago, as well as a Hyperion Law post discussing circumstances when patenting may not be the right strategy. This week’s column examines a couple of aspects that are frequently missed during strategic IP planning, including budgeting for maintenance fees and patent acquisition (distinct from filing).  In other words,consider putting aside your patent filings once in a while and consider what patents may be available in the secondary market.

But first, regarding maintenance fees, I’m always baffled as to why companies neglect this relatively simple part of their budgeting and planning.  The fee amounts rarely change by much, if at all.  Moreover, their dates are fixed at the instant a patent issues.  Nevertheless:

For companies that do no long term planning, maintenance fees are paid (or not) on an ad hoc basis. When the fees become payable (or worse yet, when the fees become due or past due), companies without a strategy make snap decisions about whether to keep one patent, or abandon another. Of course, throughout the course of a year, and especially a 5 year period, your tolerance for expenses and beliefs about a product/technology can vary greatly.

Having explained the status quo, it’s incredibly easy to see why this type of decision making is entirely ludicrous:

This is no way to make decisions, especially when the payment windows and due dates are fixed in place as of the instant the patent issued. At any given moment, knowing which patents you own, it’s remarkably easy to find out how much you would owe in fees (assuming you kept all of your patents) over the next fiscal year, or, perhaps, a five year period. Advanced planning gives you the opportunity to prioritize patents that are important to your business and gives you time to figure out what to do with ones you feel you can let go.

Far more interesting, personally, is the fact that companies rarely consider secondary transactional markets for strategic IP acquisition.  In these cases, you’re not necessarily looking for patents related to your products.  Instead, you’re looking to protect your overall business (far more important than any patent providing the illusion of protecting your products) by acquiring patents that exploit your competitor’s weaknesses:

By identifying your competitor’s vulnerabilities, and bulking up in that area, while leaning down your prosecution efforts, you’ll wield a bigger stick and likely get more value out of your IP budget. Ask yourself, will that third CIP on an even narrower implementation of your core product really add more value than an early patent exploiting your competitor’s own IP weaknesses? Overall, the point is not so much to let this (or any website) dictate your patent strategy. But you should have a strategy. Talk to your chief IP counsel, and learn what you’re spending your money on, and why.

Read the full article here.



2 thoughts on “Patent Connections: New Year’s Patent Resolutions: Bulk Up Or Trim The Fat? A Humble Suggestion Is To Try Both

  1. I commend you for this article. It takes guts to encourage companies to jump into the NPE game and thereby risk being labeled “patent trolls.”

    Posted by patent litigation | January 12, 2011, 12:17 pm

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