Intellectual property and patents are a good thing, right? They protect your inventions and prevent your competitors from stealing your innovation and making money off of them, right?
As per our initial damnation post, wrong. The theory is considerably different from reality. They don’t stop your competition from stealing your ideas and inventions, they only give you the right to go after your competitors in court for damages (but not necessarily succeed) if your competitors steal your inventions. And moreover, they make it easy for your competitors to duplicate your invention. (Remember, to patent an invention, you have to complete define the invention in enough detail for someone to easily reproduce it. It’s like handing a car thief the keys to your brand new custom made Ferrari and asking him if he’d like a joyride.)
And, as per our initial damnation posts, not only are lawsuits not guaranteed to succeed, but if the competitor who stole your idea has deeper pockets, it could bankrupt you. Heck, even if you don’t sue, nothing stops them from claiming prior art, trying to get your patent thrown out, and suing you for IP theft (for anything not explicitly covered in your patent that they claim they invented first).
But this is not the worst of it. Many companies file, or buy, patents not to protect their IP, but to prevent you from selling yours (and this has been going on for a decade as per SI’s classic post on how the patent pirates will plunder away). Plus, since patent clerks are not experts in anything but the rules associated with filing patents, and the reviewers are typically not experts either, many patents that are much broader than they should be, and that actually patent innovations that exist in prior art as part, or all, of the invention, get pushed through by firms with big pockets and persistent lawyers. These patents are then used by companies, known as patent trolls, with no intention of actually developing or selling such products to go after companies with similar technology and demand licensing fees under threat of a patent infringement lawsuit, whether the patent portfolio is violated or not. (The idea is that, since you know how much a patent lawsuit will cost, you’ll simply cave and pay a small license fee to “license” the patent you are not already using. These patent trolls know that all they have to do to bring you to court (in Marshall, Texas) is make a reasonable sounding (not reasonably effective) case to a non-technical judge who will allow them to bring you before a completely technophobic jury.)
It’s insanity, and since the US is not as smart as the EU (that does not allow computer-implemented inventions to be patented), the insanity is here to stay. So what can you do?
1. Keep great documentation on all inventions so you can always demonstrate prior art when you have it.
The minute something is invented and verified by a third party, gather irrefutable evidence and documentation and insure efforts are taken to guarantee its preservation.
2. Make extensive use of provisional patents.
These don’t have to be as finely detailed as full patents and give you a full year to hammer out the details of the invention and get a product to market before having to hand the plans over to your competitors in a full patent.
3. Plan to patent everything of of value that is invented by you.
Whether or not the organization ever intends to try to profit off of it is irrelevant, if it has value to someone, the value has to be protected because it will allow your organization to exploit that value.
4. Form an industry patent licensing cooperative.
Where each entity puts up a relatively equal share of relatively low value patents (to it) that all entities can use for a nominal licensing fee (of $1), where each member agrees to license each patent it holds to other members at a fair price in exchange for the mutual guarantee of no lawsuits (and to settle all disputes by binding arbitration at a shared cost), and where each party may use the entire portfolio to defend against patent troll lawsuits.
Will this prevent damnations from coming your way? Considering that the worst of the patent trolls believe they can take on anything, probably not, but it will certainly minimize the meaningless lawsuits and demand and mitigate damages.