Avoiding Invention Promotion Scams

The United States Patent Office also accepts complaints against invention promotion companies as well. While the Patent Office does not investigate complaints or participate in any legal proceedings against invention promoters/promotion firms, they will post the complaints together with any responses they do receive. To see the complaints that have been filed visit USPTO public forum for invention promoters/promotion firm complaints. In order for the USPTO to identify a submission as a complaint, the complaint must be clearly marked or otherwise indicate that it is a complaint filed under the American Inventors Protection Act of 1999. The USPTO has a complaint form; however, use of this form is not mandatory.

Here is a good list of INVENTOR RED FLAGS to look for when dealing with invention and idea promotion companies. This advice was first printed in the April 1996 issue of The Disclaimer, which was the newsletter of the now apparently defunct Inventors Awareness Group, Inc. of Westfield, MA. I also suggest you take a look at Don’t Be Scammed and How Inventors Can Avoid Scams, Traps and Raw Deals. The FTC also has a good set of guidelines available at Spotting Sweet-Sounding Promises of Fraudulent Invention Promotion Firms and more information at Invention Promotion Firms. The Florida Attorney General has information at  How to Protect Yourself: Invention Promotion Firms. Additionally, before an invention promotion contract can be established between you and the firm, each invention promotion firm is legally required to disclose the following information in writing:

  1. The total number of inventions evaluated by the invention promoter for commercial potential in the past 5 years, as well as the number of those inventions that received positive evaluations, and the number of those inventions that received negative evaluations.
  2. The total number of customers who have contracted with the invention promoter in the past 5 years, not including customers who have purchased trade show services, research, advertising, or other nonmarketing services from the invention promoter, or who have defaulted in their payment to the invention promoter.
  3. he total number of customers known by the invention promoter to have received a net financial profit as a direct result of the invention promotion services provided by such invention promoter.
  4. The total number of customers known by the invention promoter to have received license agreements for their inventions as a direct result of the invention promotion services provided by such invention promoter.
  5. The names and addresses of all previous invention promotion companies with which the invention promoter or its officers have collectively or individually been affiliated in the previous 10 years. This is particularly important because invention scams routinely go out of business and start operating under different names.

Now, here are some basic rules to know. If you remember these simple rules and exercise caution you will save yourself heartache, disappointment and a lot of money.

  1. If it sounds to good to be true it probably is.
  2. Invention promotion scams offer money back guarantees, no initial money down and then when money is discussed they only charge approximately $800 (or less) to start, with little or no discussion about likely additional fees. This all sounds wonderful, particularly when patent attorneys do not offer money back guarantees and routinely want at least a $5,000 retainer before beginning work. The truth is that obtaining a patent can be expensive. For more information about the cost of obtaining a patent CLICK HERE.
  3. After an invention promotion scam has you hooked you are likely to be asked for $8,000 to $12,000. Beware! They have been setting you up for this from the start, telling you what you wanted to hear about how wonderful your invention is. Reputable firms are up front about the costs from day one!  While it is difficult, or sometimes even impossible, to provide a firm quote at the beginning of the process those who are reputable should at least be able to give you some kind of ballpark estimates to at least give you some idea.
  4. If they promise to submit your invention to companies find out in great detail all that they plan on doing on your behalf. Invention promotion services can and usually does include mailing a description of your invention or your patent application to companies, but many of these companies simply do not accept outside submissions. The trick is that they promise to submit your invention, not to follow up on the submission and actually attempt to negotiate and finalize a deal.
  5. Do your homework. Know who you are getting into a relationship with. Ask for references and check them. Do a Google search and see what you find. Call the Attorney General’s office in the state where the business is located. Many, if not most, State Attorneys General collect complaints and have a consumer protection department. Check the FTC complaints and the USPTO complaints.
  6. Do not let anyone talk you into making a rush judgment and sending money quickly. Take some time to consider your choices. It is a big decision, one that you should be comfortable with. Many, if not most, invention promotion companies will try and rush your decision and will repeatedly call back to try and talk you into sending money.  Having said this, however, do not expect reputable professionals to answer endless questions about services for weeks or months.  Those with a endless questions are typically looking only for free advice and will eventually not have calls or e-mails returned.
  7. Do NOT rely upon the Better Business Bureau for information. Those who are familiar with IPWatchdog.com know that in the past I have suggested that people contact the BBB, but it would appear as if this is only a waste of time. Based on what I have been told by many people, the BBB does not have any useful information. In fact, even when an inquiry is made about a company that is well known to perpetrate scams the BBB reports a clean bill of health. This seems to be owed to the fact that the BBB does not do any kind of independent investigation whatsoever. They apparently rely only upon self reporting. The warning should be clear! Just because the BBB doesn’t know of any problems does not mean you should go full steam ahead.
  8. If you are going to be working with an attorney find out where the attorney is admitted to practice (i.e., which State) and whether the attorney is registered to practice before the United States Patent Office. After obtaining this information consider contacting the professional conduct authorities to see if any complaints have been filed against the attorney, and whether any disciplinary actions have been taken. You can contact the Patent Office for such information by getting in touch with the Office of Enrollment & Discipline.

Good luck!