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Maximising the Return on Inventions and Designs

 

The return on any invention is usually determined by the terms you can agree with a commercial licensee who wishes to manufacture or sell a product based on that invention.  That will depend not only on the potential market for the product, but also on the extent to which intellectual property rights protect the product from competition, because a company with a monopoly can usually make a greater financial return. 

 

Patent Protection

 

The main method of protecting inventions and the results of research is to register a patent.  If granted a patent, you have a monopoly for 20 years, allowing only you (and anyone you license) to exploit the invention commercially.

 

To obtain a patent in the UK, an invention must be novel, must involve an inventive step that is not obvious to somebody skilled in that particular technical field and must be something that can be made or used by industry. 

 

Patent registration is often regarded as expensive but, without patent protection, the value of an invention can be seriously diminished.  Not only that, if you do not patent your invention, someone else may register a patent that could prohibit you from manufacturing or selling, or increase the cost for you manufacturing or selling any  product covered by that patent. 

 

It is important that you have processes in place that identify the commercial potential of each invention and the likelihood of obtaining a patent at as early a stage as possible.  If you decide not to apply for a patent or to continue with a patent application you have already made then, unless your tactic is to protect your invention as a trade secret, you should consider publishing your invention as quickly as possible so that it will form part of the prior art and prevent anyone else from obtaining a patent. 

 

Prior publication will prevent a patent being granted in most countries but creates a conflict between a researcher's usual desire to publish the results of his or her work and the need to keep that research from public disclosure so that a patent application can be made.

 

Patents are national rights and careful consideration should be given to where they should be obtained.  Usually, depending on the commercial rationale, this will be in Europe, the US and Japan.  The pace at which the patent application proceeds is usually determined by when it is intended to license the invention.  If an invention can be licensed within 20 months after the application, the major costs of the application might be passed on to a commercial licensee.

 

The key is to view a patent application as a staged process that needs to be managed to keep costs down. 

 

It is often useful to make a UK patent application first as the UK Search Report will allow an early assessment of the strength of the invention.  The initial application is likely to cost around £5,000, but costs will increase more rapidly once the application reaches the PCT (Patent Co-operation Treaty) stage, after which it will be considered by different national patent registries in different countries.

 

Design Rights

 

Obtaining a patent may not be the only form of protection for your invention.   Unregistered design rights involve no registration and therefore no registration costs.  

 

Under the Copyright Designs and Patents Act 1988 design right can relate to any aspect of the shape or configuration of the whole or part of an article.  It allows the owner the exclusive right to reproduce the design for commercial purposes. The design must be original; it must be neither copied nor commonplace in the field in question. The right lasts for 15 years from the creation of a design document or prototype, or ten years from when the article was first marketed.  

 

There is now an unregistered Community Design Right which gives the same rights throughout the EU.  This right lasts for 3 years from when the design is first made available to the public in the EU.

 

Establishing the existence of a design right depends on proof of the creation of the design rather than registration at a registry.  It is therefore important that researchers sign and date design documents and ensure that records of those documents are kept in case they are necessary for enforcing or licensing those rights. 

 

That sort of procedure is also important for US patent applications where priority is given to the first to invent (rather than the first to file a patent as in the UK and other jurisdictions) and proof of the date of an invention may be required.

 

Another possibility is to obtain a registered design.  That gives you a 25-year monopoly to make any product incorporating the design. 

 

Registering a design takes a matter of months and the fee is less than £100. 

 

The design needs to be new in the sense that an identical design must not have been disclosed to the public anywhere in the world before the date of the application.  There is an exception to this where an earlier disclosure could not reasonably have become known to a person specialising in the sector concerned.  There is also a grace period of 12 months preceding the application for registration in which a designer can exhibit and market a design without creating a disclosure that prevents registration.

 

Once a design has been registered in the UK it may also be registered in other countries that are members of the Paris Convention for the Protection of Industrial Property.  Within Europe there is also a Community Registered Design that gives essentially the same rights as a UK Registered Design throughout the EU.  Again official fees are small, between 300 to 400 euros as a single fee for protection in all member states.

 

Conclusion

 

To make the most of inventions as assets you should not only ensure that you have well managed procedures for patenting inventions, but should also consider the possibility of protection under other intellectual property rights, where appropriate.  By using a combination of intellectual property rights you may be able to make a better return on your assets when negotiating licensing deals.

 

 

Contact Details

If you would like further advice about any of the issues considered above please contact Paul Northwood on 01869 331753 or email him at paul.northwood@northwoodreid.com

 

Terms of Use

This article is not intended to be, and should not be taken as being, legal advice. The law often changes and it varies from jurisdiction to jurisdiction; the information in this article is generic in nature and specific legal advice should be taken before acting on any of it.

 

© Northwood Reid 2007. The use, copying and dissemination of this article are subject to our Terms of Use.