Investing and Patenting for startups

This website exists to help startup companies who want patents to:

Below is information to answer the most frequent questions. If anything is unclear or doesn't match what you have been told by somebody else, please let me know (LinkedIn or Twitter).

Patents are not products

This is important. A patent is supposed to give its owner the right to block or control permission for others to implement a claimed invention. A patent does not give its owner the right to implement products with the claimed invention.

Your products and your competitors' products such as devices, methods, chemicals, and biological substances can implement claimed inventions. The patents you own can block your competitor, and the patents that your competitor owns can block you. For example, if Alice invents wheels and Bob invents wheels with gears attached then Bob can block Alice from selling wheels with gears, but Alice can block Bob from selling any kind of wheels.

Most technological products are built from many improvements. Light bulbs today are different from light bulbs in year 2000, which were different than light bulbs in year 1900. When Thomas Edison patented his type of light bulb, he could stop other companies from selling those types. However, other companies with patents on different types of light bulb could stop Mr. Edison from selling their types.

Why we have a patent system

You can deduce the answers to many questions about the patents system by remembering why we have a patent system.

Every powerful country in the world has its own patent system. They are all based on the same principles. They are a deal between inventors and the public. The inventor teaches the public about an invention, and, in exchange, the public allows the inventor to control who can implement the invention for a period of years (20 years for the most common type of invention in most countries).

By controlling who can implement the invention, a patent owner controls a monopoly. They can charge any price they want to maximize their profits.

This has two effects.

Choosing a patent attorney

What matters

Patent attorney is a credential. So is patent agent. Getting those credentials have various requirements in various countries. For the purpose of applying for patents, either one has the credentials needed to interact with a patent office on your behalf.

To get patents that meet your business needs, competence is more important than credentials. Anybody with the right knowledge can write your patent no matter where in the world they are or what credential they have (or don't have). A patent professional needs two kinds of knowledge: technological and legal.

Good patent professionals are quick at studying unfamiliar technologies so that they can ask inventors knowledgeable questions. You know your tech, so you can tell if a patent attorney understands it well enough. However, startup founders, CEOs, and CTOs usually cannot tell whether a patent professional is legally competent or just good at faking it. Here are the questions you can ask a US patent attorney or agent to see if they know their stuff.

1. Should I search for prior art?

If the patent professional say "information disclosure statement (IDS)" or "inequitable conduct" or "damages", that's a yellow flag. It's okay if they also mention "estoppel" and "extra office actions" and "attorney's fees". If not, that's a red flag. They don't understand the scale of different risks, and their advice will cost you extra money to their benefit. Find a different attorney.

2. I have multiple inventions written and ready to file. How can you get it done quickly?

This begs the attorney to mention the possibility of describing multiple inventions in one specification and using it to file for multiple patents simultaneously or sequentially. If the attorney tells you that they will write separate specifications for each patent, they are planning to charge you for duplicative work.

3. I want patent coverage in the US and UK. Can I work with an attorney there first?

The US attorneys will tell you about "foreign filing licenses". No problem. But if they try too hard to dream up other reasons why you must work with a US attorney first, beware. You can decide later who you want to have write your patent, but it doesn't have to be a US attorney for you to get US and global patent coverage.

4. What are URLs for 5+ recently published US patent applications that the you wrote

Look at the claims. US patent claims should only use two words of legalese, "comprising" and "wherein". You should be able to read the sample claims and understand what the invention does. If the claim is difficult to understand, the patent will be weak. You want to hire a patent attorney who writes claims that are easy to understand. The Detailed Description section of the patent should also be clear and free of legalese, except for the last few paragraphs.

5. Notice the words that the patent attorney uses in your conversation.

If a patent attorney talks about "rejection", "allowance", and "examiner", they probably know how to get patents. However, getting bad patents is easy. If the attorney also talks about "valid", "enforceable", and "judge", they are showing an understanding of what makes patents that are strong, valuable, and useful.

6. What percentage of the attorney fees that you pay go to the attorney?

Big law firms are like two- or three-tier pyramid schemes. Less experienced associates do the work while more experienced partners take a cut. The cut is often more than 50%. The partners spend their time looking for large clients with a lot of business. Attorneys in small law firms and solo practitioners get to keep all of the money you pay. That gives them more incentive and freedom to spend enough time to do a good job for startups than big law firms.

7. Do I need an agent or an attorney?

Patent attorneys can file lawsuits in courts. They tend to bill at significantly higher rates than patent agents. For the purposes of getting patents, attorneys and agents are equally credentialed. If you find an attorney who describes patent agents disrespectfully, look for somebody respectful to work with.

8. What are some of the most important cases you have read?

Doing the wrong things in a patent application can hurt the eventual patent's enforceability. To avoid the pitfalls, your patent professional should have read and understood at least the most important US case law. They should be able to summarize for you the important takeaway lessons from KSR, Alice, Mayo, and Festo. For software inventions, they should know Williamson.

9. What do you know about my field of technology?

This is simply to test your patent attorney's preparation. A good patent attorney will take the time, off the clock, to read your website and do at least enough web searching to know what you mean when you use the technical words from your website.

10. Do they ask questions?

Many patent attorneys record discussions with inventors for later review. That's okay. But it's important that a patent attorney follow and understand their entire discussion with the inventor. There is something initially confusing about every great invention. Attorneys who lack self-confidence will not stop to ask a question when they don't understand something. They pretend that they understand, hope that they can get back on track as the discussion continues, and rely on being able to listen to the recording later and look things up. That's bad. You need an attorney who will stop at important points in a discussion of an invention and ask the inventor to provide more detail.

What doesn't matter

These are some things that are not very important in choosing a patent attorney.

Years of experience

New patent attorneys should learn on large company clients first. A startup should work with a patent attorney who has at least 5 years of experience. That is because the patent office takes 3 years to do things. So, it takes 5 years for an attorney to have made a few mistakes and had a chance to learn from their result.

Beyond 5 years, it doesn't matter. A lot of old timers follow habits that they learned many years ago. As case law develops, best practices change over time. It is more important to find an attorney who reads case law than one who has been in practice for a very long time.

Billing rate

There is very little correspondence between an attorney's hourly billing rate and their competence. Some who work at a high rate can do a good job in a short amount of time. Some will take longer to do a good job but bill at a lower rate. What messes up incentives is when the attorney doing the work has to share a large portion of their income with partners who are not doing the work. Most attorneys can give you a good idea up front of what it will cost. Many will even offer you a fixed fee for the project.

If it's going to cost you more than $16k USD to get a patent application written and filed, that would be a big yellow flag on price. If it's going to cost less than $8k USD, that would be a big yellow flag on quality. Each office action should cost somewhere in the range of $2.5k USD to $4k USD.

Former examiner

Many former patent examiners leave the patent office and become patent attorneys or agents. That is fine. But patent examiners don't need to know about how lawsuits work. They don't need to know how to get good patents that are enforceable, strong, and valuable. Having been a former patent examiner is nice, but not a strong reason why a patent attorney is a good one.

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For patent professionals

National Association of Patent Practitioners

All US patent drafters and prosecutors should join NAPP, especially solo practitioners and small firms.

NAPP is a forum to share practice tips and answer tricky questions. NAPP also provides malpractice insurance discounts and free usage of Patent Bots software for checking applications and patent office correspondence.