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MenuPatent pitfalls ... Can I? Should I? How should I NOT go about it? How do I evaluate law firms? How long will it take? How much will it cost?
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The area in which you are working is quite complex both in terms of describing inventions and in terms of the changing legal landscapes. An expert is definitely suggested. Even then, the terms of an agreement would be difficult to protect under patent law. This makes such a business model harder to protect than others. That said, there is often some technical aspect to software that is patentable separate from the business model itself, so you may want to look there as well.
I have very little advise on how to go about the process. I am an expert at Patent Law and can easily review people's work to determine its quality. That said, I could not do that for at least 10 years while working as a patent professional as the small nuances, etc. make it difficult to see what is poorly thought out vs. what is very well thought out - they often appear similar to an untrained eye. Most people look for the most thorough description, though this is not an indication of the planning and strategy in the application.
Most noteworthy, noone really reviews patent work, so even success of practitioners may not be the best indication. I know the answer is not helpful, but it is honest.
Here is my short checklist that anyone can look into:
1) Do they have their work reviewed and by whom?
2) Do they work with other attorneys to improve their work quality on a regular basis?
3) How do they approach strategy for claims?
4) What is their success rate for broad claims?
5) Do they handle a lot of software applications?
6) When do they call for help?
General questions include
1) Do they bill by the hour or on a fixed fee basis?
2) What is the time frame?
3) What do you need to do?
Every client has a best fit representative so don't think that there are best answers to the second set of questions. I have worked with excellent entrepreneurs who love working with me and with others where the relationship was better handled by someone else in my firm. Personality, style, etc. play a big role in the feeling that you are being well-protected.
In general, I personally look for someone who is business minded, who requires no work from me, who has their work reviewed very regularly by people from other firms, who call for help often, who handle a lot of software, and who bill on a relatively fixed fee basis for the drafting work.
I hope this helps.
I have written and filed three patents with two different startups and am currently advising a third startup on patent process. There are different stages within a startups growth in which it should worry about an do different stages of the patent process. If you would like to discuss it further let me know.
Related Questions
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I have an idea for a simple household kitchen product (under $5). Where can I get good advice on the process of bringing it to market?
Hi! The quick answer is that simple invention ideas are great as they are the fastest and least expensive to develop, yet can still be highly profitable. I run a consumer product firm which has developed hundreds of inventions for home-based inventors or small product firms - Essentially we take it from Idea to Store Shelves. The best advice I can give is to ONLY do what is absolutely required to sell product... There are lots of great services out there that are beneficial; however, if you're on a limited budget, stick to only what is necessary to make a sale, which is: 1. Industrial Design / Engineering, 2. A manufactured sample and a manufacturer who can produce product, and 3. A provisional patent. Essentially what you need is a real, physical, and fully functioning unit of your product, the prices to manufacture that product and a manufacturer who is ready to produce units, and intellectual property protection so that your idea is not stolen. Once you have these 3 items, you can start to present your product to wholesalers, retails, distributors, etc. If someone likes it and the price is reasonable, they can place an order, and your business and dream product starts to grow. From there, there is a whole world of possibilities, but the most important thing for now is to develop your product from 'idea' into 'real'. Whatever you do, do not get caught up in the idea of 'licencing' your idea. An idea is almost impossible to licence unless it is CURRENTLY being manufactured AND being SOLD through stores. If someone or a company says that they will help licence your product idea for royalties, etc., then they should be willing to do that for FREE, no charge, no fees. Many people attempt to charge fees to licence a product idea; however, if you aren't currently selling in stores, it will almost be impossible to get any form of monetary payment, so they usually are just trying to get your fees for their 'marketing' services, which are almost useless for an undeveloped product, and they know this. If you would like more information on some of the details of product development, we have a free Invention Guide on our website, check it out here: http://www.makoinvent.com/free-invention-kit/ Cheers, Kevin Mako President, Mako Invent www.makoinvent.com www.facebook.com/makoinvent www.twitter.com/makoinventKM
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Can a provisional patent act as a catch-all?
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!TW
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Should I be worried that a potential client wants us to guarantee that we will cover the litigation costs if they are sued for using our software?
I am a patent attorney generally on the patent owner's side. Signing such a clause should make you nervous. You don't want to be responsible for the major company's infringement. The major company is likely getting more benefit out of using your software than your company is making by selling licenses. The previous gentleman's answer is incorrect. Anyone can be sued for patent infringement if they make, sell, or *use* the claimed invention. It depends on the claims in the asserted patent. Based on experience, it's much more likely that the larger entity would be sued for infringement. A patent infringement case could cost anywhere between $350k-$5M+ USD. http://www.cnet.com/news/how-much-is-that-patent-lawsuit-going-to-cost-you/ In order to properly answer your question, I would need to know why you feel it's "very unlikely" that someone would sue the major company for using your software. If the major company won't back down on this provision, the best thing you can do is determine if you need IP (defense) insurance. If a patent attorney determines that it is necessary, raise the price of your license and get IP insurance.AP
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How can I sell my app idea, and do I need to get it patented?
This is a little hard to answer because it is so vague. It depends on the area, the market and the strength of innovation. I know that The App Guy has a terrific podcast at http://www.theappguy.co/ and is also trying to organize a community for App developers to sell their ideas. Let me know if I can be of further assistance to discuss patentability in terms of its value to getting a sale or license. What ever you do, don't spend money filing a full patent, just a provisional. Good luck.TH
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Does anyone know of a good SaaS financial projection template for excel/apple numbers?
Here is a link to a basic model - http://monetizepros.com/tools/template-library/subscription-revenue-model-spreadsheet/ Depending on the purpose of the model you could get much much more elaborate or simpler. This base model will help you to understand size of the prize. But if you want to develop an end to end profitability model (Revenue, Gross Margin, Selling & General Administrative Costs, Taxes) I would suggest working with financial analyst. You biggest drivers (inputs) on a SaaS model will be CAC (Customer Acquisition Cost, Average Selling Price / Monthly Plan Cost, Customer Churn(How many people cancel their plans month to month), & Cost to serve If you can nail down them with solid backup data on your assumption that will make thing a lot simpler. Let me know if you need any help. I spent 7 years at a Fortune 100 company as a Sr. Financial Analyst.BD
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