Should tech start ups with a sole owner/founder/inventor (patent pending) filing an LLC License or Assign patent rights into the newly formed LLC?

I am a corporate attorney and have advised clients of protection of the intellectual property integral to their operations. In the intellectual property world, there are three types of federal registration you can pursue - patent, trademark, and copyright. Patents secure ideas, trademarks secure brands, and copyrights secure written product. If you are looking to protect your idea, you may think about filing for a patent. The first step is securing a provisional patent that sort of holds a spot for your idea while your actual patent application is pending or your idea goes into development. The patent process is complicated and lengthy, so I would recommend getting the advice of a patent attorney if that is something you want to explore. Not all ideas are able to be patented, and you may find that a patent is not an option for you. The other option is to maintain your idea as a trade secret. This essentially means that you are careful about who you share it with, and when you do share it with anyone, you have an Non-Disclosure Agreement in place that prohibits them from disclosing your idea to anyone else or misappropriating it for themselves. If you had a company built around the idea, you would establish an in-depth trade secret program designed to prevent disclosure of your idea outside of the company. (e.g. Coca Cola has a trade secret program built around the recipe for Coke.) As an individual, you would just need to be careful and, to be extra thorough, get people with whom you share your idea to sign NDAs. There is no federal registration process involved in maintaining a trade secret, just common sense and consistency with your protective practices.

It's becoming more and more difficult for patent trolls to litigate with the current discussions in Congress. It really depends of your market. If it's involving software patents, it's even harder. At Nesting Partners my firm actually bring patents to life then to product then to market to exit! We know quite a lot about patents and work with a lot of trolls (or NPEs) to help them find an alternative to litigation.

I help clients leverage and monetize their patents in a variety of ways. One of the best methods is to attend and exhibit at trade shows in your field. Targeting startups may be one approach, but that's not the only market for your patent. I'd be happy to talk with you about identifying the best trade show and working the direct solicitation angle as well. Let me know when you're ready to get started!

The patent process can be fairly expensive (depending on the product and your claims). I went through it over the course of several years (yes, you read that correctly) and it took MUCH longer than anyone projected and cost MUCH more as well. So depending upon your financial situation it might be cost prohibitive to proceed until you secure sufficient capital. Since the implementation of the FITF (aka FIF) system the rules and recommendations that stood for years have shifted. So the general recommendations you may think are good ideas may no longer apply. Know that if you DO decide to file a provisional patent you have 12 months from the date of filing to file a non-provisional patent. And if you make any changes (aka "new matter") you may have to file another provisional patent because you cannot add any new matter to the non-provisional patent. The provisional patent can be a useful tool - but depending upon the product and the strategy you are planning to execute during development and market testing - it may or may not provide the protection you desire. I would highly recommend that you consult with a patent attorney to get an idea about what's involved (i.e. costs, processes, time-frames). At the very least hire a skilled professional to do a patent search FOR you - not only to ensure that it in fact is unique but also to ensure it is "patentable". You may already know this but it's worth repeating: (1) Your fear of your idea of being "stolen" is one that almost every entrepreneur with a "big idea" holds and (2) It's far less likely to happen than you might think. I wish you the best of luck!

A provisional patent is good for two things. It is a date-stamped proof of invention and gives you time to determine whether to incur the cost of filing a full patent. Yes, so long as the individual component pieces you think are useful are sufficiently described in detail within the one general application, it sets you up to later claim utility patents for any and all of these, providing they really are unique. But in general, I would really caution you from spending time and money to file patents for a software company. I've built many innovative software products over 20 years of work in our industry and only filed one patent in my life, and even that patent is only to protect people from abusing a truly transformative and world-changing technology. That said, a provisional patent is inexpensive and if any expense is going to be incurred here, a catch-all is sufficient if you feel inclined to file anything at all. If your goal is an acquihire or acquisition, utility patents do actually make a difference in the acquirers valuation (at least for now) but if you're thinking about it from an actual defensive perspective, I'd really advise that it's not worth your time (and distraction) and money. The best defence is a great offence. Scale up, get great engagement from users who love your product and you'll be in a much stronger to fight competitors. Lastly, if you do decide to file a provisional patent, don't claim to anyone that you have I.P. You don't. :) Happy to talk through this in a call with you. Best of luck!