Patently Strategic Podcast: Top Three Inventor Mistakes

The patent world is full of trap doors that lie waiting for unsuspecting inventors. Without a good map and an intentional path, mistakes and missteps can be plentiful and costly. Some of these mistakes are reversible with limitations. Others have no undo button. When is it safe to talk about your idea or sell your invention? How do you hedge against invalidation and rejection from blind spots with competitor IP and prior art? How do you ensure you actually own your invention when working with employees and contractors?

The answers to these questions – and even knowing to ask them in the first place – goes a long way toward keeping inventors on solid ground. Long term success will depend on the steps taken – or not – very early in the journey. This timing is unfortunate for many inventors, however, since it’s also when they know the least about the process.

A Guidebook for Inventors

A wise person once said that life is too short to make all of your own mistakes. In the talks we give, and in the content we publish, we spend a lot of time talking about the all-too-common missteps made around public disclosure, prior art searching, and invention ownership. We do this because we’ve seen these costly mistakes made far too often by folks before they come to us. There is still clearly a massive awareness problem. We’ve truly made it part of our mission to educate around these dangers so they can be avoided in the first place, saving inventors time, money, opportunity cost, and a lot of frustration.

If there were a guidebook we could hand to inventors on the first day following the conception of their idea, this episode would be it.

Episode Overview

In this month’s episode, Dr. Ashley Sloat, President and Director of Patent Strategy at Aurora, leads a discussion along with our all-star patent panel, exploring the most common patenting missteps taken by inventors and startups. The focus largely centers around three key areas:

1. Disclosure. Publicly disclosing your invention before you have filed a patent application.
2. Search. Not searching to see if your invention or something similar already exists commercially or in publicly available resources.
3. Ownership. Not carefully contracting with outside vendors and employees to make sure you own your invention.

The group highlights best practices for not making the mistakes in the first place and explores available remedial options should you already be in need of a rescue line.

Top Mistake #1: Public Disclosure Timing

The number one mistake we see, especially with first time inventors, centers around public disclosure timing – both too early and too late. The tragic irony is not lost on this one. The fundamental deal of the patent system involves trading an enabling public disclosure through the patent office for a government granted monopoly with a fixed window. The public good from a patent is ultimately public disclosure, but like with many things, timing is everything.

Sharing too early. You can’t sell, offer for sale, or make public the invention before your effective filing date with the patent office, so disclosing too early and in the wrong manner can strip you of your rights to patent and protect your idea. But what does it mean to publicly disclose or offer for sale? Some actions probably seem obvious, but as we’ll explore in this episode, others are a little sneakier.

Not sharing at all. This timing problem around disclosure also presents an obvious tension. Sharing too much and too soon can have detrimental effects on your ability to later protect your idea. But not sharing at all can come with tremendous opportunity cost. Sharing an idea provides valuable insights and traction, from feedback to refinements to people recruitment. Keeping your idea a secret may also not be an option depending on your funding goals. As an inventor approaching potential investors, you’re going to want to protect your idea before sharing – and spoiler alert, but most investors are unwilling to sign NDAs given their handcuff potential on future deals.

The lo-fi solution. And, like many inventors at this stage, you probably don’t have all of the details worked out or a big budget, so a full-blown utility patent seems out of the question. A rescue line from this unfortunate trap is called a provisional patent application. A provisional patent is a lower fidelity, lower cost patent application that pends for one year (unexamined), but secures your filing date – allowing you to talk with investors, get feedback, potentially make sales, and beat would-be competitors across the finish line to the USPTO in our First Inventor to File system.

Top Mistake #2: Not Searching Prior Art

Not searching to see if your invention or something similar already exists commercially or in publicly available resources is the second major mistake we see – and can lead to some pretty big headaches both in the short and long-term.

In the short-term, doing patent searches will help you better understand the competitive landscape and let you know if something similar exists commercially or in publicly available documentation. This is a relatively low-cost option that should be done before filing. With far more confidence, it will help you end up with a patent that is more likely to be granted. Searching can also result in a higher degree of confidence that you’ll actually have freedom to practice your innovation without infringing existing issued patents.

In the long-term, you should end up with a higher quality, more robust patent that will hopefully:

• Stand the test if later challenged for validity
• Be drafted in a way that is better positioned around the competitive landscape in terms of legally asserting your rights against infringers

An all-too-common fate. In terms of challenges on validity alone, to put this in perspective, district courts invalidate patents at a rate of about 40% and according to US Inventor, 84% of granted patents that come up for challenge in front of the Patent Trial and Appeal Board are invalidated. Many (but certainly not all) could have spared themselves this fate had they done better diligence up-front with searching.

In this episode, we break down some of the most common types of patent searches, show where they fit into the innovation lifecycle, and highlight several free search tools. For an even deeper dive on searching, see our Sleuthing Your Way to Stronger Patents episode.

Top Mistake #3: Not Owning Your Invention

The third major mistake we see – and this one can be an absolute nightmare to untangle – is not carefully contracting with outside vendors and employees to make sure you own your invention. This usually boils down to a fundamental misunderstanding of inventorship vs. ownership.

Inventor Rights. In the U.S. especially, patents are granted to inventors and not directly to companies. The U.S. Constitution defines inventor rights. It states that Congress has the power “To promote the progress of science and useful arts, by securing for limited times to … inventors the exclusive right to their … discoveries”. Under this constitutional authority, Congress later passed The U.S. Patent Act which gives inventors exclusive rights to exclude others from making, using, importing, and selling the patented innovation for a limited period of time.

When it’s just you … These rights exist not only to protect and encourage investment in innovation, but also to explicitly protect the rights of the inventor and the conception of the idea. Inventors, by default, enjoy the exclusivity rights. Broadly speaking, this is a good thing. And in a situation where you’re doing EVERYTHING as an independent inventor, this is pretty cut and dry. You have the idea, you own the idea, and you get to benefit from the exclusive rights.

If you’re not doing EVERYTHING … Things get more complicated when we start talking about companies with employees or contractors who are doing the inventing. The big gotcha here is that just because you own a company and pay employees, contractors, or other third parties who come up with ideas, that doesn’t automatically give your company ownership and the rights to the IP. If this isn’t navigated properly and employee inventors or contractors don’t assign their rights to the company, the inventors could profit from the invention even after no longer working for the company. They could license the patent rights without sharing royalties with the company and could even become a competitor and sell a competing product.

Assignment to the rescue. In this episode, the panel breaks down all of the nuance between inventorship and ownership and provides practical tips for making sure IP assignments are executed and lines of ownership are made clear to all involved. For an even deeper look into the potential perils of working with employee and contract inventors, see our Prenuptial Patenting episode.

Discussion Panel

Ashley is joined by our always exceptional group of IP experts, including:

• Kristen Hansen, Patent Strategist at Aurora
• Ty Davis, Patent Strategy Associate at Aurora
• David Jackrel, President of Jackrel Consulting

What’d We Miss?

This Top Three list comes from our own experiences working with inventors over the past decade. The perspective from your practice or invention journey could be very different. Please drop a comment if you have a different Top Three and we’ll consider covering it in another episode. Remember, the awareness problem is a shared problem!