Source: https://ar.b-ok.org/book/2575435/7aaedb
Timestamp: 2019-12-11 03:02:23
Document Index: 260724557

Matched Legal Cases: ['ART 1', 'ART 2', 'ART 3', 'ART 4', 'ART 5', 'arts 1', 'art14']

﻿ Fundamentals of Patenting and Licensing for Scientists and Engineers (2nd Edition) | Matthew Y Ma | download
الرئيسية Fundamentals of Patenting and Licensing for Scientists and Engineers (2nd Edition)
This comprehensive book is the first of its kind to take scientists and engineers beyond simply getting a patent granted. Through the author's extensive technical background and experience in intellectual property licensing, it ties the many technical, legal and business aspects of patent enforcement to the innovation and patenting stage in the patent value chain, with the objective of helping inventors to create valuable patents that can be capitalized.
In easy-to-understand language, this book covers various aspects, including basic concepts of patent laws and rules, innovation protection, patenting, patents post-granting and patent licensing. With over 40 tables, 70 figures, nearly 100 cases and examples, and a comprehensive index table, it serves as a practical handbook for inventors and patent practitioners.
This second edition incorporates the latest changes in the America Invents Act (AIA), with additional case studies and illustrations throughout the book. For inventors who want to file patents by themselves, this new edition provides guidelines and step-by-step instructions on preparing and filing a US provisional patent application, while avoiding the pitfalls that commonly occur in do-it-yourself patenting.
Readership: Researchers, scientists, engineers, individual inventors in innovation, entrepreneurship, business management, patent strategy and portfolio management, intellectual property professionals and engineering students in graduate studies.
ISBN 13: 9789814452533
ISBN: 981445253X
patent2513
invention654
patents364
filing291
licensing271
patenting237
patenting and licensing169
scientists and engineers168
licensing for scientists166
fundamentals of patenting165
inventor162
specifications134
prosecution127
attorney124
rejection119
patent application118
provisional117
uspto108
patent search99
inventors97
filed89
patent office88
patent prosecution69
applicant68
infringement67
filing date66
aia62
patent law62
novelty62
litigation60
statutory60
ownership56
classification55
see patent54
patentability51
patentable49
disclosure48
disclosed48
provisional application48
inventorship48
infringing46
patent holder46
patent owner45
obviousness45
entity45
patent filing45
patent attorney44
patent system42
prosecution history42
provisional filing41
cited40
Franckh Kosmos Verlags-GmbH&Co. KG
Patenting and
8734_9789814452533_tp.indd 1
26/1/15 4:44 pm
Scientific Works, USA
8734_9789814452533_tp.indd 2
Fundamentals of patenting and licensing for scientists and engineers / Matthew Y. Ma
(Scientific Works, USA). -- Second edition.
ISBN 978-9814452533 (hardcover : alk. paper)
1. Patents. 2. Patent laws and legislation. I. Title.
T339.M255 2015
346.04'86--dc23
Copyeditor: Liliana E. Ma
Cover Designer: Margaret K. Ma
Steven - Fundamentals of Patenting (2nd Ed).indd 1
4/2/2015 2:26:08 PM
To my wife Katherine for 25 happy years of marriage.
Preface.................................................................................................... xxi
PART 1 The Basics ................................................................................. 1
Chapter 1 The Basics of the Patent System .............................................. 3
1.1 Patent Rights Are Granted by the Government ........................... 3
1.1.1 The Purpose of the Patent System ..................................... 3
1.1.2 The Foundations of the Patent Examination ..................... 4
1.1.3 The First-to-file and the First-to-invent ............................ 5
1.1.4 The PTAB after the AIA in the U.S. ................................. 6
1.2 Ideas to Assets: The Patent Value Chain ..................................... 7
1.3 Patent Rights, Patent Infringement and Patentability .................. 9
1.3.1 Exclusive Right ................................................................. 9
1.3.2 Patent Infringement ........................................................... 9
1.3.3 The Right to Build ........................................................... 10
1.3.4 Patentability..................................................................... 11
1.3.5 Exclusive Right and Patentability ................................... 12
1.3.6 Product Clearance and Cross-licensing ........................... 13
1.4 Patent Portfolio Strategy ............................................................ 14
1.5 Trade Secrets and Patenting ....................................................... 15
1.5.1 Trade Secrets and Patent Protection ................................ 15
1.5.2 Can I First Keep a Trade Secret, but Later File
a Patent? .......................................................................... 16
1.5.3 Secrecy Measures in Patenting........................................ 17
1.5.4 IBM’s and Tesla’s Open Policy ...................................... 18
1.6 Patents and Research Papers ...................................................... 19
1.6.1 Evaluation Processes ....................................................... 19
1.6.2 Goals ............................................................................... 21
1.6.3 Considerations ................................................................. 21
1.7 A First Glance at the Attorney’s Draft ....................................... 22
1.8 Patent Maturity Date .................................................................. 23
Chapter 2 What You Should Know about Patent Law .......................... 27
2.1 Types of Patents and Patent Examination .................................. 27
2.1.1 Type of Patents and Terms .............................................. 27
2.1.2 Patent Examination and Patent Prosecution .................... 28
2.2 Patent Dates ............................................................................... 29
2.2.1 List of Patent Dates ......................................................... 29
2.2.2 Priority Date .................................................................... 29
2.2.3 Chain of Priority Date ..................................................... 30
2.3 Invention Date: Conception, Diligence and Reduction
to Practice................................................................................... 32
2.4 Patentability ............................................................................... 33
2.4.1 Patentable Subject Matter................................................ 33
2.4.1.1 Statutory Categories of Invention ...................... 33
2.4.1.2 Exceptions to Statutory Categories
of Invention ........................................................ 34
2.4.2 Conditions for Patentability ............................................ 35
2.4.2.1 Novelty .............................................................. 35
2.4.2.2 Nonobviousness ................................................. 36
2.5 Inventorship ............................................................................... 36
2.5.1 Inventorship as Legal Issue ............................................. 36
2.5.2 Correcting Inventorship after Patent Is Allowed............. 38
2.5.3 Case Studies of Inventorship ........................................... 38
2.5.3.1 Research Corporation Technologies v.
Microsoft............................................................ 38
2.5.3.2 Ethicon Inc. v. United States Surgical Corp. ..... 39
2.5.3.3 Correcting Inventorship in Xerox Patent ........... 40
2.6 Patent Ownership ....................................................................... 42
2.6.1 Patent Ownership ............................................................ 42
2.6.1.1 If You Are an Independent Contractor or
Freelancer .......................................................... 43
2.6.1.2 If You Are a Full-Time Employee ..................... 43
2.6.1.3 If You Are a University Researcher................... 44
2.6.2 Patent Assignment ........................................................... 44
2.6.3 Patent Owner’s Rights..................................................... 45
2.7 Inventor’s Rights........................................................................ 46
2.7.1 Inventor’s Financial Rewards.......................................... 46
2.7.2 Inventor’s Declaration and Oath ..................................... 46
2.8 Accelerated Examination ........................................................... 47
2.9 Patent Search.............................................................................. 48
2.10 Duty of Disclosure ..................................................................... 49
2.10.1 What Is Materiality? ........................................................ 50
2.10.2 What Is Intent to Deceive? .............................................. 50
2.10.3 What Needs to Be Disclosed? ......................................... 51
2.10.4 Who Has a Duty to Disclose? ......................................... 51
2.10.5 When Do You Need to Disclose and How? .................... 51
2.11 International Treaties ................................................................. 52
2.11.1 The Paris Convention ...................................................... 52
2.11.1.1 National Treatment ......................................... 53
2.11.1.2 Independence of Patents ................................. 53
2.11.1.3 International Priority ....................................... 54
2.11.2 The Patent Cooperation Treaty ....................................... 55
2.11.2.1 International Filing and Priority Date ............. 55
2.11.2.2 National Stage ................................................. 55
2.11.2.3 Preliminary Search and Written Opinion ........ 56
Chapter 3 How to Read a Patent ............................................................. 58
3.1 Anatomy of a Patent................................................................... 58
3.1.1 Patent Cover Page ........................................................... 58
3.1.2 Patent Drawings .............................................................. 61
3.1.3 Patent Specifications ....................................................... 62
3.1.4 Patent Claims .................................................................. 63
3.2 Understanding the Embodiments of a Patent ............................. 64
3.3 Patent Claim Basics ................................................................... 64
3.3.1 Independent and Dependent Claims ................................ 64
3.3.1.1 An Example ...................................................... 66
3.3.1.2 Why Dependent Claims? .................................. 66
3.3.2 Patent Claim Structure .................................................... 67
3.3.2.1 The Preamble.................................................... 68
3.3.2.2 The Transitional Phrases .................................. 68
3.3.2.3 The Main Body of Claims ................................ 69
3.4 Different Types of Claims ......................................................... 70
3.4.1 System Claims ................................................................. 70
3.4.2 Product-by-process Claims ............................................. 72
3.4.3 Method Claims ................................................................ 73
3.5 Understanding the Scope of the Invention ................................. 74
3.5.1 The Scope of the Invention ............................................. 74
3.5.2 Understanding Limitations in Claim Construction ......... 77
3.5.2.1 Limitations of Dependent Claims..................... 77
3.5.2.2 The Order of Elements ..................................... 77
3.5.2.3 Jepson-type Claim ............................................ 78
3.5.2.4 Means-plus-function Claims ............................ 78
3.6 What to Look for When You Read a Patent .............................. 79
3.6.1 If You Are Filing a Patent ............................................... 79
3.6.2 If a Reference Patent Is Cited in a Rejection of
Your Claims .................................................................... 80
3.6.3 If You Are Making a Product.......................................... 81
3.6.4 If You Are Catching an Infringer .................................... 82
3.7 Published Patent Application ..................................................... 83
PART 2 Getting Ready for Patenting.................................................. 85
Chapter 4 Innovation Harvesting ............................................................ 87
4.1 Patentability Analysis ................................................................ 87
4.1.1 Knowing the Art .............................................................. 87
4.1.2 Patentability Checking .................................................... 88
4.1.3 Patentable Subject Matter and Tangible
Usefulness Test ............................................................... 89
4.1.4 Case Studies of the Statutory Categories of Invention .... 90
4.1.5 Novelty ............................................................................ 93
4.1.6 Nonobviousness .............................................................. 94
4.2 Patenting beyond Core Algorithms ............................................ 96
4.3 Innovation Harvesting ................................................................ 97
4.3.1 Patent Brainstorming ....................................................... 97
4.3.2 The Prior Art Search and the Market Analysis ............... 99
4.4 Patent Landscaping .................................................................. 100
4.4.1 Data Sources.................................................................. 100
4.4.2 Methodologies ............................................................... 101
4.4.3 Patent Landscape Examples .......................................... 102
4.5 Making Filing Decisions .......................................................... 104
4.5.1 How Essential Is the Technology to Your
Business and the Industry? ............................................ 104
4.5.2 What Patent Rights Will You Be Getting?.................... 104
4.5.3 For Which Market Do You Want to Seek Protection? .. 105
Chapter 5 Protecting Your Invention and Planning Your
Patent Filing ......................................................................... 107
5.1 Documenting Your Invention .................................................. 107
5.1.1 Why Do You Need to Document Your Invention? ....... 107
5.1.2 How to Document Your Invention? .............................. 108
5.1.2.1 Invention Lab Book .......................................... 108
5.1.2.2 Electronic Documents ...................................... 109
5.1.2.3 Other Evidence and “Rule of Reason”
Standard ............................................................ 110
5.2 Patent Ownership and Government Regulations ..................... 111
5.2.1 The Bayh-Dole Act ....................................................... 111
5.2.2 Federal Acquisition Regulation (FAR) and
Supplement (DFARS) ................................................... 112
5.2.3 Subject Invention .......................................................... 112
5.3 Filing as Soon as You Reduce to Practice ............................... 113
5.4 Filing before You Disclose, Use or Sell .................................. 114
5.5 The Continuation-in-Part (CIP) Strategy ................................. 117
5.5.1 The CIP Filing ............................................................... 117
5.5.2 Chain of Co-pending Applications................................ 117
5.6 Working with an Attorney ....................................................... 119
5.6.1 Challenges of Working with an Attorney...................... 119
5.6.2 Working with an Attorney Is an Interactive Process ..... 120
5.7 Who Can File a Patent for You? .............................................. 121
5.7.1 Seeking Professional Services....................................... 121
5.7.1.1 Geographical Location .................................... 121
5.7.1.2 Patent Attorney or Patent Agent ...................... 122
5.7.2 Do Not Use an Online Service ...................................... 123
5.7.3 Doing Partial Work by Yourself ................................... 124
5.7.3.1 The Cost-splitting Approach............................ 124
5.7.3.2 A Patent Search Gives You a Sense of
Confidence ....................................................... 125
5.7.3.3 Clear Specifications Are the Key to Success ... 125
5.7.3.4 Claims Should Be Drafted by Your Attorney
or Agent ........................................................... 125
5.7.3.5 Responding to an Office Action Requires
Teamwork ........................................................ 125
5.8 Can You File a Patent by Yourself?......................................... 126
Chapter 6 Preparing Your Patent Applications ..................................... 128
6.1 Structural Parts of a Patent and Their Purposes ....................... 128
6.1.1 A Patent Document Is a Technical Document .............. 128
6.1.2 Title ............................................................................... 129
6.1.3 Abstract ......................................................................... 130
6.1.4 Background of the Invention ......................................... 131
6.1.5 Brief Summary of the Invention.................................... 131
6.1.6 Drawings ....................................................................... 133
6.1.7 Detailed Specifications of the Invention ....................... 134
6.1.8 Claims ........................................................................... 135
6.2 Best Practice in Drafting Specifications .................................. 135
6.2.1 Using Clear Terminology .............................................. 135
6.2.2 Enabling Your Invention ............................................... 136
6.2.3 Disclosing Alternative Embodiments............................ 137
6.2.4 Disclosing the Best Mode ............................................. 138
6.3 Citations ................................................................................... 139
6.3.1 Backward Citation ......................................................... 139
6.3.2 Forward Citation ........................................................... 140
6.3.3 Avoiding Over-citing .................................................... 141
6.4 What Is Considered New Matter? ............................................ 142
6.5 Broadening and Diversifying Claims ....................................... 144
6.5.1 Critical Thinking ........................................................... 144
6.5.2 Broadening Claims ........................................................ 145
6.5.3 Diversifying Claims to Protect Software and
Business Method Patents............................................... 146
6.5.4 Diversifying Claims to Target Prospective Infringers .. 148
PART 3 Patent Prosecution and Post Granting ............................... 151
Chapter 7 Patent Prosecution ................................................................ 153
7.1 Patent Prosecution History ....................................................... 153
7.1.1 What Is the Prosecution History? .................................. 153
7.1.2 What Is Included in the Prosecution History? ............... 154
7.1.3 Why Is the Prosecution History Important? .................. 156
7.2 Restriction and Election Requirements .................................... 158
7.2.1 What Is the Restriction Requirement? .......................... 158
7.2.2 What Options Do You Have after Receiving a
Restriction Requirement? .............................................. 160
7.3 What If All of Your Claims Are Rejected?.............................. 161
7.4 When All of Your Claims Are Allowed in the First
Office Action ........................................................................... 161
7.5 Conditional Allowance ............................................................ 162
7.5.1 What Is Conditional Allowance? .................................. 162
7.5.2 Checklist for Inventors .................................................. 162
7.6 Telephone Interview with the Examiner .................................. 164
7.7 When a Final Rejection Is Received ........................................ 165
7.8 Appeal ...................................................................................... 166
7.9 Third-Party Protest ................................................................... 167
Chapter 8 Tactics for Overcoming Rejections ...................................... 169
8.1 Common Rejections on the Merits........................................... 170
8.2 Rejection Related to Specifications ......................................... 171
8.2.1 Enablement.................................................................... 171
8.2.1.1 A Critical Feature of the Invention Is
Disclosed in the Specifications, but Not
Cited in the Claims ........................................... 171
8.2.1.2 The Specifications Do Not Provide
Sufficient Support............................................. 172
8.2.2 New Matter.................................................................... 173
8.3 Novelty Rejection and Prior Art .............................................. 174
8.3.1 Anatomy of the Pre-AIA Novelty Rule......................... 174
8.3.2 Statutory Bar and “Swearing Behind” .......................... 178
8.4 Overcoming a Novelty Rejection............................................. 180
8.4.1 Perfecting the Priority Date ........................................... 180
8.4.2 Distinguishing Claims ................................................... 181
8.4.3 Working with Your Patent Attorney to Avoid Pitfalls .. 182
8.4.3.1 Word-by-word Comparison.............................. 182
8.4.3.2 Genus and Species ............................................ 183
8.4.3.3 Nonanalogous Art or “Teaching Away” .......... 184
8.5 Novelty under the AIA............................................................. 184
8.5.1 Anatomy of the Post-AIA Novelty Rule ....................... 184
8.5.2 Rebuttal of a Novelty Rejection under the AIA ............ 185
8.6 Obviousness Rejection ............................................................. 186
8.6.1 The Difference between a Novelty Rejection and
an Obviousness Rejection ............................................. 186
8.6.2 The Basis of an Obviousness Rejection ........................ 187
8.6.2.1 A Reference Cited under 103 Must Be a 102
Reference, Except That It Is Not Anticipatory 187
8.6.2.2 Analogous Art .................................................. 187
8.6.2.3 The Level of Ordinary Skill in the Art at
the Time of the Invention ................................. 188
8.6.2.4 The Differences between the Claimed
Invention and the Prior Art ............................... 189
8.6.2.5 Determination of Obviousness or
Nonobviousness................................................ 189
8.7 Tactics for Overcoming an Obviousness Rejection ................. 190
8.7.1 Common Approaches .................................................... 190
8.7.2 Distinguishing Claims ................................................... 191
8.7.3 Secondary Considerations ............................................. 196
8.8 Admission of Prior Art by an Applicant .................................. 198
Chapter 9 Post Patent Granting ............................................................. 200
9.1 Publications .............................................................................. 200
9.1.1 Do Not Mention Product Names in Publications .......... 200
9.1.2 Product Brochures ......................................................... 201
9.2 Reissue ..................................................................................... 202
9.2.1 Broadening Claims ........................................................ 203
9.2.2 Narrowing Claims ......................................................... 203
PART 4 Patent Monetization ............................................................. 207
Chapter 10 Patent Strategy for a Successful Business .......................... 209
10.1 Patenting Is Business Driven ................................................... 209
10.2 Defensive Strategy ................................................................... 210
10.2.1 Counter Assertion Is an Effective
Defensive Weapon ........................................................ 210
10.2.2 Cross-licensing Is a Good Defensive Tool .................... 211
10.3 Offensive Strategy ................................................................... 211
10.4 “Carrot” Licensing and “Stick” Licensing ............................... 212
10.5 Patent Issues in Industry Standards.......................................... 213
10.5.1 Intellectual Property Policy in Standards Bodies ......... 213
10.5.2 Considerations in Standards Participation.................... 215
10.5.3 Standards and Patent Value .......................................... 216
10.6 Patent Issues in Open Source ................................................... 217
10.6.1 Open Source Background and Benefits ....................... 217
10.6.2 GPL and LGPL Licenses.............................................. 218
10.6.3 Other Open Source Licenses and
Compatibility Issues ..................................................... 220
10.6.4 Open Source Concerns and IP Strategy ....................... 222
10.7 Uncovering Infringing Products............................................... 223
Chapter 11 Patent Evaluation and Patent Maintenance ........................ 225
11.1 Patent Use ................................................................................ 225
11.2 Market Potential ....................................................................... 227
11.3 Claim Quality ........................................................................... 228
11.3.1 Claim Breadth .............................................................. 228
11.3.2 Claim Diversity ............................................................ 229
11.4 Technical Strength ................................................................... 230
11.5 Ease of Detection and Reverse Engineering Costs .................. 232
11.6 Patent Maintenance .................................................................. 232
11.6.1 Patent Evaluation for Maintenance Considerations ..... 233
11.6.2 Patent Maintenance Is a Business Decision ................. 234
Chapter 12 Common Practices in Patent Monetization ........................ 236
12.1 Outright Sale and Licensing..................................................... 236
12.1.1 Which Option to Select? .............................................. 236
12.1.2 Non-Exclusive and Exclusive Licenses ....................... 237
12.1.3 An Exclusive License with Enforcement Rights.......... 237
12.1.4 License Grant Backs .................................................... 238
12.2 Technology Transfers .............................................................. 238
12.3 Patent Family and Surrounding Patents ................................... 239
12.4 Field of Use .............................................................................. 240
12.5 Patent Ownership ..................................................................... 241
12.5.1 The Chain of Title ........................................................ 241
12.5.2 Encumbrance ................................................................ 242
12.5.3 Government Rights ...................................................... 243
12.6 Patent Enforceability................................................................ 243
12.6.1 Prior Art Risk ............................................................... 244
12.6.2 Maintenance Fee .......................................................... 244
12.6.3 Other Patent Invalidity Risks ....................................... 245
12.7 Patent Age ................................................................................ 246
12.8 Litigation History ..................................................................... 247
12.9 Due Diligence Checklist .......................................................... 247
Chapter 13 Patent Valuation ................................................................. 249
13.1 Intangible Assets and the Reason for Patent Valuation ........... 249
13.2 Representative Valuation Approaches ..................................... 251
13.2.1 The Cost Approach ...................................................... 251
13.2.2 The Income Approach .................................................. 252
13.2.3 The Market Approach .................................................. 252
Factors Affecting Royalty and NPV Calculation ..................... 254
Drawing the Connection between Patent and
Market Revenue ....................................................................... 256
The Patent Infringement Damage Award ................................ 258
Patent Sale Case Studies .......................................................... 260
13.6.1 A Few High Profile Patent Deals ................................. 260
13.6.2 Public Patent Auction ................................................... 262
PART 5 Skills ...................................................................................... 265
Chapter 14 Patent Search ...................................................................... 267
14.1 The Basics of the U.S. Patent Search ....................................... 267
14.1.1 The USPTO Patent Database........................................ 267
14.1.1.1 Quick Search ................................................. 268
14.1.1.2 Advanced Search ........................................... 268
14.1.1.3 Search Result Display ................................... 271
14.1.1.4 Patent Search Tips ......................................... 271
14.1.2 Google Patent Search ................................................... 272
14.2 International and Other Foreign Patent Databases ................... 274
14.2.1 International Patent Database ....................................... 274
14.2.2 European Patent Database ............................................ 277
14.3 Patent Classification................................................................. 278
14.3.1 The U.S. Patent Classification ...................................... 279
14.3.2 The International Patent Classification ........................ 282
14.3.3 The Cooperative Patent Classification ......................... 284
14.3.4 Concordance to IPC and CPC ...................................... 284
14.4 Progressive Patent Search ........................................................ 285
14.5 Monitoring Fresh Patents ......................................................... 286
14.6 The USPTO PAIR and Image File Wrapper ............................ 287
Chapter 15 How to File a U.S. Provisional Patent Application ............ 290
15.1 The Benefits and Pitfalls of a Provisional Application ............ 290
15.2 When Do You Need to File a Provisional Application? .......... 292
15.3 Specifications for a Provisional Application ........................... 293
15.3.1 What Should You Include? .......................................... 293
15.3.2 What Should You Not Include? ................................... 294
15.3.3 Format of Your Specifications ..................................... 295
15.4 Determining Your Entity Status............................................... 295
15.5 Filing a Provisional Application Electronically ....................... 297
15.5.1 What Do You Need to Get Ready? .............................. 297
15.5.2 Filling Out Your Application Data Sheet (ADS) ......... 298
15.5.3 Filing Online................................................................. 299
15.6 What’s Next after the Provisional Filing ................................. 302
Appendix A ........................................................................................... 315
Appendix B ........................................................................................... 321
References ............................................................................................. 323
Index ..................................................................................................... 325
If you can recall the maze of uncertainty and tension that surrounded the
keepers of the ring in J.R.R.Tolkien’s Fellowship of the Ring as they
tried to return it to the place where it can no longer do any harm, then
you know something about the tension of the US patent system and the
licensing of intellectual property (IP) rights. You may never need to deal
with fire breathing dragons, and you may not have the likeness of
Gandalf the Grey on your IP staff, but success demands that you know
how to navigate the patent system before and during prosecution. You
need to know how the actions you take before signing the patent
application can make the difference between granting of claims and
denial of your application and subsequent loss of all your hard work.
Toward this end, Matthew Ma has collected his extensive knowledge of
the patent system and licensing strategies to guide you through the maze
and then shows you ways you can monetize your hard work. This book
will guide you through the labyrinth of treacherous terrain and bring you
to a point where you can see the way forward using practical and easyto-understand reasoning.
The earlier edition of this book had been used regularly in my interdisciplinary “Patents and Trade Secrets” course at Rochester Institute of
Technology. The new edition of this work brings the book up-to-date
with the current America Invents Act, the first major overhaul of the US
patent system since the 1950s. The clarity and insight Ma brings to the
new inventor and the budding entrepreneur not only makes for
exceptional class discussion, but it can be the foundation of practical
knowledge upon which you can build a successful intellectual property
rights agenda.
Like the Hobbits, you may get into some battles along the way, but
learning the way forward from an experienced patenting and licensing
professional like Ma is essential if you are to make progress. Best wishes
to all who start the journey.
William P. Johnson, Esq. J.D. MSEE BSEE BA
Professor, College of Applied Science and Technology
This book is written for scientists, engineers and inventors, as well as
patent practitioners, corporate patent managers and intellectual property
business leaders, who are often involved in either patent creation or the
monetization of patent assets.
Surprisingly, in today’s intellectual property marketplace, especially
the patent marketplace, two observations can be made:
1. Most of the patents that exist today are not at all profitable. The
capital generated from patent sales and licensing comes only from a
small percentage of all of the assets in the marketplace.
2. A major reason why most patents are not being utilized is that they
have not been written to their full potential.
This phenomenon relates greatly to deficiencies in our innovation
creation and patenting processes. People seem to think that once a patent
is granted, no matter what claims are finally obtained, a great
achievement has been accomplished. Also, most inventors cease their
involvement in the patenting process at an early stage. They often hand
their patent disclosure and technical reports to their patent attorneys and
walk away from the rest of the process. Inventors’ lack of involvement in
the subsequent patent examination has a hugely adverse effect on the
ultimate quality of the patents granted.
To many readers of this book, the legal aspects of patents are often a
particularly significant undertaking. Therefore, a unique approach has
been taken in selecting the materials and in addressing the various
difficult topics, differentiating this book from many similar titles
currently on the market. Particularly:
This book does not require you to possess prior knowledge about
patents or patent laws. It is written in easy-to-understand language
and includes over 40 tables, 70 figures and nearly 100 cases and
examples, so that technologists or businesspersons can grasp the
patent world without being overwhelmed by overly complex legal
2. The patenting and enforcement stages in a patent value chain do not
happen in isolation. This book ties the many technical, legal and
business aspects of patent enforcement to the innovation and
patenting stage, as well as the importance of patent quality and its
relation to the economic value of an asset.
3. This book provides a comprehensive table of contents and index
table, making it a good reference book on your desk to help you with
your daily work in patenting and licensing. If you are new to patents,
you will find the first two introductory chapters quite helpful. They
will give you, in a nutshell, a condensed summary of the patenting
process and relevant law.
This second edition incorporates the latest changes in the America
Invents Act (AIA), which went into effect on September 16, 2011. It has
also gone through a major structural overhaul, has incorporated many
comments and suggestions from readers of the first edition, and has been
updated with more illustrations, new case law and best practices in all
aspects of the patenting process.
For inventors who want to file patents by themselves, this new edition
provides guidelines on how to prepare a U.S. provisional patent
application and step-by-step instructions on how to file the provisional
The Scope and Organization of This Book
PART I: THE BASICS (Chapters 1 – 3)
Chapter 1 discusses the basics of our patent system and clarifies some
common misconceptions about patents. This chapter provides insightful
and valuable perspectives on many common issues inventors frequently
encounter, such as exclusive rights, trade secrets, the best mode
requirement, patent maturity, etc. Chapter 2 is intended to give you a
condensed version of patent laws and rules, highlighting all the necessary
basic information an inventor needs to know. Chapter 3 provides the
anatomy of a patent and illustrates the essentials in reading patents. It
teaches how to understand embodiments and the scope of claims, and
illustrates specific things that need to be looked for when reading
someone else’s patents for different purposes.
PART II: GETTING READY FOR PATENTING (Chapters 4 – 6)
This part covers various practical aspects of patenting. Chapters 4 and 5
cover various topics pertaining to innovation creation, such as harvesting
ideas, patent landscaping and strategy, how to protect your innovation,
making filing decisions, as well as how to work with patent attorneys or
agents as a team. Chapter 6 provides many details about patent filing,
including best practices and pitfalls in preparing one’s patent disclosure.
PART III: PATENT PROSECUTION AND POST GRANTING
(Chapters 7 – 9)
Chapters 7 and 8 provide you with many insights into the patent
prosecution process and offer practical suggestions about how one
should get involved in this process to create a stronger portfolio, all from
an inventor’s perspective. Later, Chapter 9 also addresses how an
inventor should continue carrying out his duty in maintaining the
integrity of his invention even after the patent has been granted.
PART IV: PATENT MONETIZATION (Chapters 10 – 13)
This part is intended to give interested readers a broad spectrum of
business and financial perspectives concerning patents and the patenting
process, particularly with respect to monetization. It discusses various
issues and common practices in patent strategy, licensing, sales, patent
evaluation, patent maintenance and patent valuation. It is also suggested
that you skim through this part to get a big picture of the patent value
chain before you start from the beginning of this book.
PART V: SKILLS (Chapters 14 – 15)
Chapter 14 highlights some patent search tools, including the U.S. and
international patent databases and the patent classification systems, and
their uses in conducting a patent search. It also introduces the U.S. Patent
Application Information Retrieval (PAIR) system, which is a great
resource in checking the status of patents. Finally, the newly added
Chapter 15 serves as a helpful reference tool for those who want to file
provisional patents by themselves. DIY for traditional patent filing is
always risky, in that inventors who lack adequate knowledge about
patenting may inadvertently hurt themselves by making innocent yet
irreversible mistakes. This chapter, however, intends to prepare readers
to take advantage of the simple and easy provisional filing system in the
U.S., while avoiding the pitfalls that commonly occur in patenting-ityourself.
I am grateful to several scholars: Prof. William Johnson at Rochester
Institute of Technology, who also graciously agreed to write the
foreword of this edition, Prof. Tal Lavian at the University of California
at Berkeley, Prof. Truls Erikson at the University of Oslo and Prof.
Shubha Ghosh at the University of Wisconsin Law School, for using the
first edition of this book in teaching their respective courses and for
many of their suggestions.
I am also grateful to the University of Berkeley Center of
Entrepreneurship and Innovation, and Tsinghua University School of
Economics and Management for giving me the opportunity to teach
“Patent Strategy and Innovation” for their joint entrepreneurship program
for the past three years. It has been a truly rewarding experience through
which I have collected abundant first-hand feedback that helped to
improve the quality of this second edition.
My gratitude also goes to Mr. Paul Prestia, with whom I have had the
privilege of working on the exciting Asian market for the past three
years. As a co-founder of his own law firm, RatnerPrestia, and a
prominent patent attorney and scholar in the intellectual property field,
Paul became my mentor and my inspiration to get my foot in the door of
the legal field. I also want to thank other attorneys at RatnerPrestia,
particularly Mr. Kenneth Nigon for his suggestions and input.
I am indebted to my wife, Katherine, and to my daughters, Liliana
and Margaret, for their love, patience and unconditional support
throughout the writing of this book. Katherine is my reviewer, Liliana is
my copyeditor and Margaret is my cover designer. Without their support
and sacrifice, this book would not be possible. I am also thankful to my
parents for their continuous encouragement, moral and financial support
of this project, and to my father Guoyu, a mathematics professor and the
author of several books of his own, for his many suggestions.
Most importantly, I am thankful to the readers of the first edition of
this book for their enthusiasm and their quest to learn about intellectual
property, and for many of their comments and suggestions for
improvement, which I have incorporated into this second edition. I hope
you enjoy reading this second edition as much as I have enjoyed reading
the comments from my readers.
Matthew Ma, Ph.D.
mattma@ieee.org
The Basics of the Patent System
To many people, patents are associated with intelligence, pride and
honor. Being granted a patent is considered a significant achievement.
But, although obtaining a patent is certainly a milestone, it is certainly
not the ultimate goal. The focus of this book is to provide you with
various technical, business and legal perspectives regarding patents and
the patenting process, with the ultimate goal of helping you to create
high quality patents that have the potential to be commercialized. This
chapter introduces the basics of patenting by explaining the patent
system and the patent value chain. It also clarifies some common
misconceptions about patents.
Patent Rights Are Granted by the Government
1.1.1 The Purpose of the Patent System
A patent right is a monopoly right that the government grants to patent
holders in order to promote science and technology.1 The purpose of
granting this right to patent holders is to encourage them to disclose their
inventions, instead of keeping them secret, so that the public may benefit.
Article 1, Section 8 of the United States Constitution: The duty of the Congress is to
“promote the progress of science and the useful arts by securing for limited times to
1.1.2 The Foundations of the Patent Examination
Because a patent right is granted by the government, a patent
examination is naturally the function of a government office in each
respective country. In the United States, this office is the United States
Patent and Trademark Office (USPTO, or the PTO or the Patent Office),
an agency in the Department of Commerce. Similar to other countries,
the patenting system, which is based on the Constitution, includes three
major components in the U.S.: patent law, patent rules and The Manual
of Patent Examining Procedure (MPEP), as shown in Table 1.1. These
governing laws, regulations, policies and procedures establish the
guidelines that all patent examination procedures at the Patent Office
Table 1.1 The governing laws, regulations, policies and procedures of the U.S. patent
Codified in 1953 into its substantial present form, Title 35 of the
United States Code2 (referred to as 35 USC). This code, also called
Patent Law or Patent Statues, governs all cases within the purview
of the USPTO.
The USPTO is authorized to implement its own regulations not
inconsistent with Patent Law.3 These regulations, referred to as the
Patent Rules, established by the USPTO in accordance with the
statues and codified in 37 CFR,4 have been used to govern
examiners and applicants, as well as their attorneys and agents.
This guide is a reference book on the practices and procedures
regarding the prosecution of patent applications before the USPTO.
It contains 27 chapters and over 2,000 pages of guidelines on
specific aspects of patent examination.
United States Code: a consolidation and codification by subject matter of the general
and permanent laws of the United States.
35 USC 2 states that “the USPTO is authorized, subject to the policy direction of the
Secretary of Commerce, to establish regulations not inconsistent with law for the conduct
of proceedings in the USPTO.”
37 CFR - Code of Federal Regulations, Title 37, Patents, Trademarks, and Copyrights.
Parts 1, 3, 4, 5 and 10 of Title 37 pertain to patents.
The MPEP contains abundant references and guidelines for patent
examiners, patent attorneys and patent agents. Although it also claims to
be a reference for patent applicants, it is certainly impractical for an
inventor to digest the entirety of these references. As a scientist or
engineer, and a prospective inventor, you can rely on your
representatives, patent attorneys or patent agents to follow all of these
guidelines. However, having basic knowledge about patent law will
certainly give you an advantage in your inventing process and will help
you to lay a good foundation in subsequent patenting. The rest of this
book aims to reduce the complexity of the law into a form that is simple
enough for you to make use of the patent system, and thus, to capitalize
on your innovation.
1.1.3 The First-to-file and the First-to-invent
The first-to-file system or the first-to-invent system determines which
inventor gets the patent in case two inventors have independently
conceived the same invention. The fundamental principle in our patent
system is that two patents cannot be granted for the same invention. If
two parties claim the same invention, only the first inventor has priority,
and ergo, obtains the patent. Who the first inventor is depends on which
patent system is used: the first-to-file system or the first-to-invent
system. Under the first-to-file system, which has been adopted by most
countries, the party who files the patent first is the first inventor. Under
the first-to-invent system, which has been adopted by very few countries,
including, formerly, the U.S., the party who conceives the invention first
is the first inventor.
The biggest recent change in U.S. patent law is the America Invents
Act (AIA). Among many changes pursuant to the AIA, one major change
is that the U.S. finally adopted the first-to-file system. However, this
change applies only to new applications filed on or after March 16, 2013,
whereas existing pending applications and their continuation
applications, and litigation and reexaminations related to pre-AIA
applications, are not affected by the AIA. Therefore, pre-AIA patent law
is likely to be relevant for several more decades.
For the remainder of this book, all of the contents that will be covered
will address both pre-AIA and post-AIA patent applications, unless
otherwise indicated. When the AIA is applicable, we will discuss the
rules separately.
1.1.4 The PTAB after the AIA in the U.S.
In addition to the change from the first-to-invent to the first-to-file
system, another significant change in the U.S. patent system under the
AIA involves the post grant procedures before the new Patent Trial and
Appeal Board (PTAB, the Board),5 pursuant to which a third party can
challenge the validity of a granted patent. The PTAB is still under the
administration of the USPTO, but it is above the level of patent
examiners, and it appoints patent judges to make decisions in each trial,
as opposed to juries, who often make decisions in court procedures. The
new procedures include an inter partes review (IPR),6 a post grant review
(PGR)7 and the covered business method patent review (CBM)8 to allow
a third party to challenge the validity of a patent.
As a result of their efficiency and lower standards, these new
procedures have created an incentive for third-party challengers. Under
the PTAB post grant procedures, a patent that is undergoing
reexamination is not presumed to be valid, and a mere preponderance of
the evidence, which means that the evidence shows that a proposition is
more likely than not, is sufficient to justify a finding of patent invalidity;
this is a lower standard than that required in previous inter partes
reexaminations or in court procedures. In a reexamination for validity,
the Board gives the broadest reasonable interpretation to claims, as if a
new application was being examined, and the PGR provides a broader
Renamed from the Board of Patent Appeals and Interferences (BPAI), effective as of
September 16, 2012, under the AIA.
To replace the inter partes reexamination as of September 16, 2012. Under the IPR, a
third party can challenge a patent past 9 months after the grant of the patent.
Under the PGR, a third party can challenge a patent within 9 months after the grant of
The CBM procedure was to sunset in 2020. See
http://www.uspto.gov/aia_implementation/bpai.jsp#heading-3.
base for reexamination on the merits than other procedures.9 This low
threshold incentivizes third parties to launch early challenges to patents;
as can be expected, in the years since the new procedures have taken
effect, this has resulted in the invalidation of a majority of claims that
have been considered by the Board.
Although both parties can appeal the decision of the Board to the
Federal Circuit Court, the new post grant procedures have the effect of
deterring the enforcement of weak patents. This book is intended to
provide you with the basics of our patent system and the fundamentals
you need to know in order to create high quality patents that will survive
a post grant challenge and that will be enforceable in the future. An
equally important aspect of a high quality patent is the economic value of
the patent in the patent value chain, which will be discussed in the next
Ideas to Assets: The Patent Value Chain
An overview of the patent value chain is illustrated in Fig. 1.1. This
process consists of two major stages: patenting and monetization. The
patenting process is primarily concerned with generating patents as
investments, while monetization is about getting a return on those
investments through the enforcement of patent rights.
A typical patenting process starts with the conception of an idea that
is followed by a reduction to practice, which involves building,
experimenting and proving that the invention works for the purpose
intended by the inventor, and further refining the original concept. The
completion of the reduction-to-practice phase is typically marked by the
filing of a patent application with the Patent Office. During the
subsequent examination of the application, which is also called patent
prosecution, the Patent Office determines the patentability of the
application under patent laws and rules. If the Patent Office deems the
application to be patentable, it issues the patent to the patent holder.
In PGR, in addition to the novelty and obviousness bases that are applicable in other
procedures or in a review by a court, invalidity can be based on prior art, utility, patent
eligibility, written description or other claim indefiniteness grounds.
Obtaining a patent is a milestone; however, it is certainly not the ultimate
goal of the patent owner.
The monetization stage is primarily concerned with monetizing the
patent after it is granted. There are several ways to monetize a patent,
including licensing, sales, technology transfer or enforcement, such as
litigation. Only a granted patent gives its owner legal rights, and thus,
only a granted patent can be enforced. The monetization process is
outside of the authority of the Patent Office.
Fig. 1.1 Patent process and patent value chain.
These two stages, patenting and monetization, form a complete patent
value chain with the purpose of obtaining a return on the investment. The
stages happen at different times and often involve different groups of
practitioners. The patenting stage usually involves law firms, patent
attorneys and patent agents who are considered to be part of the patent
legal community and who work in accordance with the guidelines of the
Patent Office. The patent monetization phase primarily involves those
who are considered to be part of the patent licensing community. The
functional division of the patent value chain inevitably causes a
disconnection between inventors and the beneficiaries of the invention.
Consequently, an inventor generally has little knowledge about how his
invention is ultimately utilized and whether it is made into a product,
licensed or sold. The main purpose of this book is to fill this
informational void.
Patent Rights, Patent Infringement and Patentability
1.3.1 Exclusive Right
A patent right is an exclusive right. Under patent law, exclusivity refers
to the right to exclude others from making, using, offering for sale or
selling the invention.10 For example, if you invent a chemical compound
to cure cancer and patent it, no one else can make and sell the compound
covered by your patent without your permission. The patent holder has
the right to sue infringers for an injunction (i.e., to stop infringers from
making and selling infringing products) or for damages. This is the
The exclusive right, however, is not an unlimited power – it is much
narrower than it may appear to be. For example, a patent right is
territorial – it applies only in the country in which the patent is granted,
and it is generally good for the duration of the patent, e.g., 20 years for a
U.S. utility model patent.11 The remainder of this section further
1.3.2 Patent Infringement
Patent infringement refers to the encroachment of a third party’s patent
right. If a manufacturer makes or sells a product based on a third party’s
patent without the patent holder’s permission, it infringes the patent
holder’s exclusive right. In order for patent infringement to occur, there
must be an infringement of someone’s patent claim.
35 USC 154 (a)(1). “Every patent shall contain a short title of the invention and a grant
to the patentee, his heirs or assigns, of the right to exclude others from making, using,
offering for sale, or selling the invention throughout the United States or importing the
invention into the United States, and, if the invention is a process, of the right to exclude
others from using, offering for sale or selling throughout the United States, or importing
into the United States, products made by that process, referring to the specification for the
particulars thereof.”
We will describe different types of patents later in Chapter 2.
Independent claim:
-Step A
-Step B
-Step C
-Step D
-Step E
Fig. 1.2 Infringement test.
A simple test for determining whether a product infringes someone
else’s patent is to examine whether the product has all of the features
described in the claims of the patent in question. As illustrated in Fig.
1.2, a patent’s system claim has 3 components: A, B and C. If Product X
only needs A and C to work, it does not have all of the features in the
patent claim; therefore, it is not covered by the patent claim, and it is not
infringing. If Product Y needs A, B and C, and additionally, D and E, it
has every element in the patent claim (i.e., A, B and C) and is therefore
infringing the patent. Product Z is not infringing the patent because it is
missing C.
1.3.3 The Right to Build
Can a patent holder himself build or sell a product based on his own
invention? Not necessarily. Many people wrongly assume that it is safe
to make and sell products once a patent is granted. Your patent right is
not about what you can do; rather, it is about what other people cannot
do. This right only allows you to exclude other people from making
products based on your invention. It does not guarantee that you can
build a product based on your invention. 12
MPEP 301.I. “Ownership of the patent does not furnish the owner with the right to
make, use, offer for sale, sell, or import the claimed invention because there may be other
legal considerations precluding same (e.g., existence of another patent owner with a
dominant patent, …).”
A product may be covered by many patents belonging to different
patent holders. For example, a mobile phone combines many different
technologies from different vendors, such as the antenna, the display, the
keypad, the software, the case, the software applications and many
mechanical parts that are covered by different patents belonging to
various people. Whether or not you can build your product depends on
whether your product rides on, or infringes other people’s patents. We
will further illustrate this concept in the remainder of this section.
1.3.4 Patentability
Patentability is about whether an invention can be patented. The main
criteria for determining patentability is to compare the invention with all
existing art (including patents and non-patent literature) to see if it meets
the novelty and nonobviousness test.13
Fig. 1.3 Patentability test.
Under the novelty and nonobviousness test, if a later invention can
differentiate itself from existing art, and such differentiation is not
obvious to a person ordinarily skilled in the art14 at the time of the
invention, it will be patentable. To illustrate this, a simplified
patentability test is shown in Fig. 1.3. In this example, Invention 1 is
different from the existing art in that it does not require Element B –
Novelty and nonobviousness are basic criteria used by a patent examiner to determine
the patentability of an invention. They will be discussed in detail throughout the book.
The obviousness criteria is judged by a hypothetical person who is presumed to have
known the subject matter of the invention, also referred to as a person ordinarily skilled
in the art (POSIT). See MPEP 2141.03.
Invention 1 is novel. If the elimination of B is not obvious, then
Invention 1 is patentable. Similarly, both Inventions 2 and 3 are different
from the existing art. If it is assumed that these differences are not
obvious, then both Inventions 2 and 3 are patentable.
1.3.5 Exclusive Right and Patentability
Another question is whether a patent holder has the right to exclude
someone else from patenting the same subject matter. The answer clearly
is no. Let us compare Figs. 1.2 and 1.3. Product Y and Invention 2 have
identical elements, yet Product Y would be considered to be infringing,
whereas Invention 2 can still be patented. As a matter of fact, the
inventor of Invention 2 does not need a license from another patent
holder in order to obtain a patent, but the manufacturer of Product Y
needs a license from the third-party patent holder in order to make and
sell the invention.
The concepts of patentability and infringement are further illustrated
through the example shown in Fig. 1.4. Someone obtained a first patent
on a traditional telephone, claiming several essential elements, i.e., a
communication interface, a phone dialer and a handset, which are also
referred to as elements A, B and C. Suppose that, subsequently, you
improved the first invention significantly by adding a LCD display
(element D) and a speaker phone to enable a hands-free feature (element
E). Your invention basically has all of the essential elements of the first
patent (i.e., elements A, B and C), but your added features, D and E, are
novel and nonobvious. You will, therefore, be able to obtain a patent.
Now, the question is: Even if your patent with A, B, C, D and E is
granted, can you freely make and sell your invention? To answer this
question, simply run an infringement test as shown in Fig. 1.2.
Apparently, if you make a phone based on your invention (to include
features A, B, C, D and E), you will infringe the first patent on the
traditional phone, because your product will still have all of the features
(i.e., A, B and C) claimed by the first patent.
We have now illustrated that an exclusive right gives a patent holder
the right to exclude others from making or selling a product based on his
invention, but it does not exclude others from patenting improved
features based on his patent. This key distinction between infringement
and patentability will be further elaborated throughout this book.
1.3.6 Product Clearance and Cross-licensing
We have established that patenting will not necessarily give you the right
to make and sell your product. If you are launching a product, it is
important for you do some research to determine if it is safe to
manufacture your product, i.e., it does not infringe other people’s
patents. This is called a product clearance or freedom to operate study. If
you have not done your research, and your product later becomes
successful, there is a high likelihood that people will start knocking at
your door. Many large operating companies, even those that already have
a strong patent portfolio, conduct a product clearance study before they
release any new product.
Fig. 1.4 Traditional telephone and its significant improvement.
You might ask yourself: If I am not free to make my own product out
of my own patent, why should I file my patent in the first place? In the
telephone example shown in Fig. 1.4, your speakerphone represents a
significant improvement over the conventional telephone. As a result, the
owner of the traditional telephone patent might be open to a negotiation,
through which you could reach a cross-licensing deal so that you both
can manufacture traditional phones and the phones with speaker. This
opens up the competition for better phones and expedites the
advancement of new technologies in the market. Having your own patent
to cover your invention will give you leverage in the cross-licensing of
other desired technologies.
A patent portfolio refers to a group of patents covering related
technologies with the purpose of providing broader protection. A wellmanaged patent portfolio can help the patent holder to gain an
advantageous position in the market. Some inventors tend to rely on a
single patent to make tons of money when they think they have achieved
a great innovation or breakthrough. This single patent scheme might
have worked well in the old days, when early technologies were simple
and primarily centered around mechanical inventions, and companies
were less sophisticated in patent strategy. However, this scheme will not
work today, when technology is rapidly changing and companies are
more sophisticated in protecting their intellectual property (IP) and
overcoming their IP barriers.
claims but
Still broad claims,
yet less difficult to create.
May require licensing high
level patents to operate
Narrow claims. Incremental
improvement over broad claim inventions,
make strong negotiation power
Fig. 1.5 Patent portfolio management strategy.
Today, large corporations tend to have a large number of patent
filings in order to gain the advantage of stronger monopoly rights in the
market, whereas small companies or universities balance the diversity of
their portfolios due to limited resources. Figure 1.5 illustrates a common
pyramid patent portfolio strategy that includes various levels of
innovations, in terms of the scope of the patent claims, to gain the
strongest protection against competitors. This strategy results in a bundle
of patents covering a rich set of claims, which can be used to catch
various types of infringers. Furthermore, a competitor must employ
many more resources to attack a portfolio with multiple facets than to
attack one single patent.
Trade Secrets and Patenting
1.5.1 Trade Secrets and Patent Protection
Trade secrets and patents are both intellectual properties, but they
provide different protections for a technology, and each has its pros and
cons. A quick comparison between trade secrets15 and patent protection
is shown in Table 1.2. A trade secret can be protected for an unlimited
time. However, the downside of keeping an innovation as a trade secret,
and not filing a patent, is that you are left with very thin protection under
the law applicable to trade secrets.16 Once a trade secret has been
disclosed publicly, or someone has independently figured out a similar or
alternative design, it is effectively nullified.
Because of the disclosure requirement of patent law17 and the
confidential nature of trade secrets, the holder of an invention naturally
faces a dilemma: to patent his invention or keep as a secret. To decide
between trade secrets and patent protection, you need to consider how
long you can enjoy the market share with your trade secret and its
associated profits before someone else is likely come up with a similar
design. This consideration needs to be weighed against how much profit
Trade secrets may include two types: the subject matter that is not patentable (e.g.
customer lists, which can only be protected as trade secrets) and the subject matter that is
patentable (e.g. an invention that can also be protected by patent). We are mostly
concerned with the latter type.
The Trade Secret Act provides some protection with respect to its secrecy and
In patenting, an inventor is required by patent law to disclose, explicitly and precisely,
how the invention works, as well as the preferred design. These requirements deter many
people from moving forward, as filing a patent appears to require a disclosure of their
you can make in the near future by patenting your technology and
licensing it to other people.
Table 1.2 Comparison of trade secrets and patent protection.
– Need to apply for patent
– The information must be secret – Need to meet the patentability
– It must have commercial value
– The holder must take reasonable – Can be disclosed publicly
steps to keep it secret
without losing protection
By disclosing
By abandonment, failure to pay
maintenance fee, missing
deadline to response to Patent
Office, expiration, etc.
Very often, the decision depends on what is being protected. In the
highly competitive and rapidly growing high tech arena, for example, the
chances are that someone will either come up with an alternative to your
secret or develop a product superior to yours fairly rapidly. It is virtually
impossible to dominate the market for any length of time with only a
trade secret. From a patenting and licensing point of view, unless you
really think your trade secret can sustain itself for a long period of time
and is vital to the success of your business, patenting will usually provide
you all of the protection you need.
1.5.2 Can I First Keep a Trade Secret, but Later File a Patent?
The answer is no. A general principle of patent law maintains that a first
inventor may lose priority if he is deemed to have “abandoned,
suppressed, or concealed” the invention.18 Numerous legal cases have
dealt with a scenario in which a first inventor has withheld a technology
by maintaining it as a trade secret, while someone else subsequently and
independently invented the same technology and was later granted a
patent. In such cases, the first inventor typically learned of the second
inventor’s patent and then took the action of filing a patent application,
claiming an early invention date19 as the supposed first inventor. Courts
have consistently declined to award priority to the first inventor and have
held that the second inventor, who “made efforts to disclose the
technology, acted consistently with sound patent policy.”20 This is also
consistent with the outcome under the first-to-file system because the
second inventor was the first to file the patent.
1.5.3 Secrecy Measures in Patenting
The patent systems in most countries provide several vehicles to patent
your technology that do not require the immediate disclosure of your
secret, including:
Provisional filing.21 Provisional filing helps you to secure an early
priority date. Unlike a regular patent application, a provisional
application will not be examined or published, so the public will
have no access to it. Inventors have up to 1 year to file a regular
patent application (called a nonprovisional application) and can still
claim the benefit of the early priority date of the provisional
application. But, if an inventor decides not to file the nonprovisional
application, the provisional application will expire in one year and
will not be disclosed to the public.
2. Eighteen months until publication. Once you file a nonprovisional
patent application, the Patent Office usually automatically publishes
Invention date is discussed in Section 2.3.
R. Schechter and J. Thomas, “Principles of Patent Law,” Second Edition, Thomson
West, 2004.
Provisional filing is available in the U.S. only and is not available in most other
the application after 18 months.22 Until then, the content of your
patent application will not be accessible by the public. 23
3. Request for patent non-publication. The publication of your patent
application is a free tool provided by the Patent Office to advertise
your technology. However, you can request non-publication at the
time of your nonprovisional filing, for a reasonable fee. This
provides you with substantial extra time to keep your innovation
protected from public access. If you later decide to file a foreign
application based on your domestic filing, you will need to withdraw
your non-publication request.
1.5.4 IBM’s and Tesla’s Open Policy
Contrary to keeping as trade secrets, some companies are quite open
about their technologies through their policies regarding patents. For
example, in 2006, IBM announced an initiative to open its patents for
public use. Particularly, the initiative included the opening of more than
100 of its business method patents (representing approximately 50
percent of IBM’s total business method patents) to the public for open
use, and prompt and public recording of the assignment of all of the
patents and published patent applications it owns.
Clearly, IBM is not shy about sharing its inventions with the public.
However, IBM’s actions are not simply giving up trade secrets. Rather,
its ulterior motive is to claim the space of its innovations. A market
effect of IBM’s open policy is that people who are independently
developing technologies similar to IBM’s may discover IBM’s published
applications and quickly abandon their own development efforts. Such
independent developers know that they would be at a severe
disadvantage due to IBM’s already well-established position in the
market place, and therefore, they may not wish to waste their effort.
Recently, in June 2014, the electrical vehicle (EV) manufacturer,
Tesla, announced its decision to open its patents for good faith public
If a nonprovisional application is based on a provisional application, as in the U.S., the
18 months starts on the filing date of the provisional application.
Patents involving national defense technologies may experience a longer secrecy
use. This act is altruistic and a sound business decision, but it is certainly
not game-changing in the patent world. Tesla is effectively giving public
notice of its advantageous position in the EV market, which will help it
to gain market use of its technologies so that it can maintain its
leadership position in sustainable transport. Although Tesla has said that
it will not sue anyone for good faith use of its patents, Tesla’s patents
continue to fulfill its defensive needs.
In summary, you must take many considerations into account when
deciding whether or not to maintain your innovation as a trade secret. If
you decide to file a patent, the patent system provides several tools that
can prolong the period of secrecy before your innovation has to be
exposed to the public. These tools may serve the same purpose as
maintaining it as a trade secret for a limited time, while giving you a
vehicle to market your technologies publicly.
In academics, a researcher often faces the choice of patenting or
publishing: Should I publish a paper or file a patent? Should the granting
of a patent count as a metric in assessing research achievement?
1.6.1 Evaluation Processes
Before we attempt to answer the aforementioned questions, let us make a
comparison of the key criteria applied in reviewing a research paper and
in examining a patent application. As shown in Table 1.3, the following
observations can be made:
The criteria used in the reviewing processes for patents and papers
are somewhat parallel. However, there are some differences. For
example, the previous work that is considered in reviews of papers is
quite different from previous material (prior art) that is used in patent
examinations. In a patent examination, in issuing his opinion on
patentability (which is called an Office action), the patent examiner
must search through all available granted patents and published
patent applications, as well as conference/journal publications
worldwide, to determine whether the innovation is novel and
nonobvious. Further, both the USPTO and the WIPO (World
Intellectual Property Office) have implemented crowd-sourced peer
reviews24 to improve patent quality. The paper reviewing process
does not involve such an extensive search or review, and judgments
regarding novelty depend on the knowledge of the reviewers, i.e.,
usually no more than 2-3 people.
2. From what might be considered an economic point of view, the
decision to accept or reject a paper has to do with the level of interest
among mainstream readers, whereas such considerations have
relatively little to do with the granting of a patent. Patenting, by
Table 1.3 Comparison of criteria for evaluating a research paper and examining a patent
Relevancy to the conference
theme or journal’s scope
Novel method/survey/experiments
Readability, organization,
Previous work used Based on the knowledge of
against novelty
reviewers (total 2-3 reviewers)
Readers’ interest
2-3 months with no rebuttal
No double patenting
Novel and nonobvious
/Enablement – must enable a
ordinarily skilled in the art to
build the invention
Comply with written
requirements in patent rules;
drawings, specifications
should support claims
Extensive search by the
patent examiner and crowdsourced peer review
2-3 years with rebuttal but
The USPTO launched a peer review pilot from 2007 to 2011 in collaboration with a
non-USPTO group for the purpose of enhancing the location of prior art in the
examination of patent applications. Since 2012, the WIPO has implemented a third party
observation system to allow third parties to submit prior art observations relevant to
patentability of published PCT applications.
nature, implies a strong economic motivation, yet this particular
economic aspect does not play a role in the examination process.
Patenting and the publication of research papers are used to accomplish
different objectives and final goals:
The main purpose for publishing a research paper, from the author’s
perspective, is often to publicize his scientific results. Publication is
a means of free information exchange, with no strings attached. All
publications are considered public domain information, and hence,
they can be freely utilized by all.25
2. Patenting is a method that allows a person to rightfully claim specific
intangibles as one’s own property. In a sense, it is also a means for
free information exchange (through the patent database), but only
after the rights of the patent holder have been secured via the patent
system. Furthermore, free patent information does not give a third
party the right to implement the invention without seeking
permission from its patent holders.
1.6.3 Considerations
Now that we have discussed the processes and goals for publishing
research papers and patenting, a few high level considerations should be
taken into account in deciding whether to publish or patent:
Consider whether a work can be published (as a research paper) or
patented, or both. There are limitations on patentable subject
matter.26 For example, theories cannot be patented. A survey of a
particular technology cannot serve as the basis for patentable subject
matter although it might be more suitable for a research paper. On
the other hand, a seemingly trivial idea may not be an appealing
Be careful to determine whether a technology disclosed in a publication may have
already been patented before such publication.
This will be discussed in detail in Chapter 2.
topic for a research paper, but under some circumstances, it could be
the focal point of a powerful patent. Furthermore, only recently have
people become aware of the fact that software and business methods
might also be considered patentable items.
2. Suppose the nature of the work is suitable for both publication and
patenting, the decision on whether to patent or publish a paper
should be made strategically. One who wishes to file a patent should
focus on the long-term economic value of the invention. More
specifically, the decision to file a patent should be based on the
exclusive right to which it pertains, the protection of any existing
products it provides and any conceivable potential application it has
to other areas. One who wishes to publish a paper, on the other hand,
should focus on what kind of audience (academic community) he
would like to reach through the presentation of his work.
A First Glance at the Attorney’s Draft
The process of patent drafting usually starts when an inventor provides a
sketch of her invention, her lab notes or a detailed technical report to a
patent agent or attorney, who then drafts the specifications and claims.
When the attorney returns the first draft, the inventor is often
overwhelmed by the unfamiliar terminology and strange language in the
draft, and may even question whether the described invention is her own.
Don’t panic! This is a common initial reaction, but it is not
necessarily a problem. When faced with this dilemma, first, you should
understand that your patent attorney’s job is to help you file your patent
with the Patent Office, and thus, to claim your legal rights in the best and
strongest way possible. The official demands of this goal often require
the patent attorney to describe your invention using very formalized
technical language, i.e., using legalese that may, at first, strike you as a
bit arcane and difficult to understand. It is nothing to worry about,
however. As illustrated in Table 1.4, your main focal points should
Pay close attention to the accuracy of the specifications. Also, make
sure you have sufficient enablement (supporting details) regarding
your invention. This is crucial in preparing a patent filing, because
once a patent is filed, the specifications cannot be changed, except in
the claims. This is the new matter issue, which will be discussed in
2. Understand the scope of claims. You do not have to know how to
write a claim, but you do need to understand the claim structure and
the scope of each independent claim.27 Talking to your drafting
patent agent and asking questions is the best way to become
Table 1.4 Your responsibilities in working with an attorney or agent.
What’s returned from
your attorney/agent
Patent disclosure form and other
Check the accuracy of inventorship
Check the technical accuracy, figures and labels
(including figures added by the attorney)
Ask your patent agent to explain the scope of
claims, and confer with him to understand the
strategy behind the drafting of each independent
Patent Maturity Date
The patent maturity date is when the patent starts gaining economic
value. While a patent’s age is indicative of how current the technology
disclosed in the patent is, the patent’s economic value may not be
apparent when the patent is relatively new. The maturity date of a patent
often has to do with the market acceptance of the invention described in
the patent. Generally, when a patent has just been issued, it is still too
early for the market, as no one has started using the invention. After
Claim construction and understanding the scope of the invention will be discussed in
some time has passed, the invention may start to gain market acceptance
as the technology matures.
The time it takes a patent to gain market acceptance depends on the
realm of technology in which it lies. For example, Figure 1.6 depicts the
age distribution among patents listed on the Ocean Tomo public patent
auction, with most of the patents being in high tech area. As can be seen,
the percentage of listed patents that have been sold in the older age group
(10~20 years) is about 82%, which is significantly higher than the 63%
within the younger age group (<10 years). The average/median ages for
listed patents and sold patents are 7.49/7.0 and 8.41/8.0 years from their
issue dates, respectively. Therefore, the patents sold in these two
auctions are, on average, 1 year older than patents that have been listed.
Patents Sold
Page age from issue date
Fig. 1.6 Patent age distribution for Ocean Tomo Spring/Summer’08 Auctions
Figure 1.7 shows the age distribution among patents for sale in the
high tech area in a private market28 from mid-2007 to mid-2008. Among
these patents, the average patent age is 7.57 years from the date of issue,
Only U.S.-issued patents were included in the statistics. The data reflects a snapshot of
a private market window and is limited only to the patents listed, as it is almost
impossible to collect any information about patents that have been sold in the private
which is consistent with the Ocean Tomo auction data above, i.e., 7.49
In another study,29 it has been reported that a patent is typically 5
years old (from its issuance date) when it is litigated. The average age is
higher for electrical patents; such patents are subject to litigation for the
first time at closer to 7 years old. In viewing all of the above statistics,
we may observe that, on average, people attempt to monetize a patent via
either sales or litigation when a patent is between 7 and 7½ years old.
Patent Age
Fig. 1.7 Patent age distribution for 2007-2008 twelve-month private sales.
One form of monetization that was not included in the previous
statistics is patent licensing, specifically, technology transfer licensing, in
which the licensee intends to deploy the invention for use in the market.
Technology transfer licensing can happen earlier, because it usually
occurs before the invented technology is actually used in the market.
A related practical question has often been asked: “My patent is
already 5 years old and it is still sitting there collecting dust. How long
should I wait before it generates revenue?” When exactly you can expect
your patent to generate value depends on its acceptance in the market,
Benjamin Hershkowitz, “What Are My Chances? From Idea Through Litigation”,
http://library.findlaw.com, 2003.
and it may take years to happen. You should periodically evaluate your
patent against market trends. If the market is heading in the direction of
your invention, continue to promote your innovation, and be patient. If
the market is heading away from your invention, your patent may never
What You Should Know about Patent Law
An understanding of the patent system is important for inventors, as any
carelessness, misunderstanding or breaking of the law by any party may
result in the rejection of a patent application or the invalidation of a
patent, even after it has been granted. This chapter gives an overview of
the patent system and a brief summary of the patent laws about which
engineers and scientists should be aware.
Types of Patents and Patent Examination
2.1.1 Type of Patents and Terms
Different countries may have slight variations in the types of patents. But
generally, there are three types, as in the U.S.: utility, design and plant
patents. Table 2.1 shows the types of U.S. patents and their terms.1 A
utility patent protects the way an invention functions and is used. Most of
the subject matter you encounter, such as chemical composition,
machinery, manufacturing process, tools, software, computer graphical
user interface, business methods and algorithms, etc., are covered by
utility patents. A design patent protects the way an invention looks, 2
which is derived from the ornamental appearance of an invention and
includes the shape/configuration or surface ornamentation of the
invention, or both. Essentially, a design patent is more about the form
Other countries may vary. For example, both Japan and China have an additional type
of patent, the utility model, to protect the shape and structure of an invention – which
often relates to its mechanical hardware and devices.
35 U.S.C. 171.
factor of an invention. A drawing is an essential element of a design
patent. A plant patent protects any distinct and new variety of plant that
is asexually reproduced,3 but does not include tuber-propagated plants or
plants found in an uncultivated state.
Table 2.1 Different U.S. patent types.
Patent types What’s protected
The way an invention functions and is used.
There are four categories: machine, manufacture,
process, composition.
The way an invention looks. The “feel & look”
14 years from
and ornamental appearance of an invention.
New varieties of plants that are asexually
reproduced, but does not include tuber-propagated
plants or plants found in an uncultivated state.
While utility and design patents offer legally separate protection, the
utility and ornamental appearance of an invention may not be easily
separated. Both design and utility patents may be obtained for an
invention if the invention possesses both functional and ornamental
Although most patent laws and rules are equally applied to utility,
design and plant patents, the discussions and examples in this book
mostly focus on utility patents, because they encompass the broadest
types of subject matter. However, this does not hinder the generality of
the fundamentals this book tries to convey.
2.1.2 Patent Examination and Patent Prosecution
Patent examination refers to the lengthy process that starts with the
applicant’s submission of a patent application, followed by the patent
application queuing for its turn to be examined, the examiner’s issuance
of an Office action allowing or rejecting the applicant’s claims and the
applicant’s rebuttal of rejections. There may be several communications
35 U.S.C. 161.
35 U.S.C. 154(a) and (c).
between the examiner and the applicant until the patent is allowed by the
examiner or abandoned by the applicant.
The term “patent prosecution” is actually interchangeable with patent
examination from the perspective of patent practitioners (e.g. patent
agents or patent attorneys) who handle cases for their clients. Simply put,
the patent practitioner who engages in patent prosecution actually deals
with an examiner in the patent examination process. Later, all of the
correspondence between the practitioner and examiner in the
examination process is recorded and referred to as prosecution history.
2.2.1 List of Patent Dates
A patent may involve several dates, which are illustrated in Table 2.2.
Table 2.2 Different dates pertaining to a patent.
The date when the application is filed.
Publication date The date when the patent application is published at the Patent Office
website and made available for public access.
The date when a patent is issued – which is also when a patent becomes
Expiration date The date when a patent expires, typically when the term of the patent
runs out. Failure to pay a maintenance fee can also cause a patent to
expire. Upon the expiration date, the invention is free for public use.
Sometimes referred to as the effective filing date. It is often used to
(effective filing determine the eligibility of prior art, which may prohibit the patent in
question from being granted. See the next section.
When an invention is conceived. This is an important date under the
first-to-invent system, to be discussed in Section 2.3.
2.2.2 Priority Date
In many cases, the priority date of a patent is simply the date when the
patent application was filed, whereas in other cases, an early priority date
(or effective filing date) can be obtained through several mechanisms:
1. Provisional application.5 If a patent application is filed less than one
year from the filing of its provisional application, it can claim the
benefit of its provisional application filing date.
2. Foreign application. If a patent application is filed less than one year
from the filing of its first foreign application (for countries
participating in the Paris Convention, which will be explained later
in this chapter), it can claim the benefit of its foreign filing date.
3. Continuation application. If a patent application is filed as a
continuation of its parent application while the parent application is
still pending, it can claim the benefit of its parent application’s filing
4. Divisional application. This is a special type of continuation
application. If a divisional application is filed based on its parent
application while the parent application is still pending, it can claim
the benefit of its parent application’s filing date.
5. “Swearing behind” in the first-to-invent system. This is applicable to
U.S. patents covered before the AIA and allows applicants to claim
the benefit of an earlier invention date.
The patent priority date is rather important. It is used in patent
examinations to qualify or disqualify a prior art reference, depending on
whether the date of the reference is before the priority date of the patent.
The earlier the priority date and the fewer prior art references an
examiner can find, the more likely it is that a patent will be granted. This
is further illustrated in an example below.
2.2.3 Chain of Priority Date
The chain of priority date refers to a series of patents filed in sequence,
with each claiming the earlier priority date of its proceeding patent. For
example, as shown in Fig. 2.1, a U.S. patent was filed on Oct. 18, 2001.
As described in the “Related U.S. Application Data” section, this patent
is also a continuation of its parent application and claims the benefit of
its parent application’s filing date, which was Oct. 15, 1998.
Furthermore, the parent application was filed within one year from its
provisional filing, which was filed on Oct. 15, 1997. Although the patent
in the example was filed on Oct. 18, 2001, its priority date is dated 4
years back to Oct. 15, 1997.
Fig. 2.1 The face of a patent and its priority date.
The effect of the chain of priority date is to afford a patent with an
earlier priority date, subsequently the chance of finding relevant prior art
for that patent is smaller; therefore, the likelihood of obtaining the patent
is higher. One condition for this scheme to be valid is that the subject
matter reflected in later claims has to be the same as that described in
early applications. If new matter is introduced and claimed in later
applications, the chain of the priority date will be broken.
Invention Date: Conception, Diligence and Reduction to
The invention date is rather important in a first-to-invent system, because
the eligibility of prior art is determined based on the invention date of the
patent under examination, which can occur before the patent’s priority
date. In order to have a valid invention date, patent law requires the
presence of all three elements: conception of the invention, continuous
diligence and reduction to practice, which can be considered to be three
stages of the inventing process, as illustrated in Table 2.3.
An invention is reduced to practice when it works for the purpose
intended by the inventor; reduction to practice is usually accompanied by
the completion of a working prototype, which is often the case for
biotech, pharmaceutical or plant patents. However, reduction to practice
does not require an inventor to build a prototype. For example, for
software inventions, a functional diagram may be sufficient to enable a
person who is ordinarily skilled in the art to build an invention that
works for the purpose intended by the inventor. The functional diagram
may be sufficient to satisfy the actual reduction to practice element.
Reduction to practice can be actual or constructive. If there is no
earlier actual reduction to practice, then the invention is constructively
reduced to practice as of its filing date. Therefore, the latest reduction to
practice date of an invention is its patent filing date.
Table 2.3 Various stages in the inventing process.
Conception   
Inventor conceives the
Inventor continues to
perfect his invention, e.g.
by building a prototype
Reduction to Practice (RTP)
The invention works for the
purpose intended by the
inventor. May be accompanied
by the completion of a
prototype or a functional flow
Actual RTP: actual completion
Constructive RTP: filing of the
patent, if no actual RTP
Conception, diligence and reduction to practice are all important
factors in determining the invention date of an invention. For example, in
determining the patentability of a patent against another patent, the
inventor who has first reduced to practice is the first inventor, unless the
party who last reduced to practice started his diligence before the
conception date of the assumed first inventor. 6 Under the AIA, this
process is much simplified, because all patents are compared against
each other based on their filing dates, rather than their invention dates.
Many inventors ask how to determine if their invention is patentable
before they decide to file a patent. This section introduces you to the
framework by discussing the key concepts regarding patentability, which
are grouped in two areas: patentable subject matter and conditions for
patentability. Each area will be further discussed in Chapter 4, when we
address the practical uses of these concepts in the context of innovation
2.4.1 Patentable Subject Matter
The fundamental requirement of patentability by law is usefulness, i.e. an
invention has to be useful.7 To determine the usefulness of an invention,
you could use the statutory categories of invention test, which is
2.4.1.1 Statutory Categories of Invention
A popular test for the patentability of subject matter is to determine
whether an invention falls into any of the four categories described in
patent law: machine, manufacture, composition of matters and process.
These are also called Statutory Categories of Invention.
35 USC 102(g).
35 U.S.C. 101 Inventions patentable. “Whoever invents or discovers any new and useful
improvement thereof, may obtain a patent therefore ….”
Examples of “machine” inventions are tangible devices consisting of
parts, combinations of devices, and combinations of hardware and
software that are all integrated within a concrete hardware device. An
automobile with wheels, chassis, engine, transmission, electrical system,
brake system, computerized system and so on is a machine. An MP3
player having a display, memory and software (firmware, audio decoder
software, application software, etc.) is also a machine. A machine can
also be a subsystem, such as an automotive engine to power a car.
“Manufacture” means the production of goods from raw materials by
giving these materials new forms, qualities, properties or combinations,
whether by hand or by machinery. An example of a manufacture
invention is the usage of magnesium alloy in certain ruggedized laptop
Typical examples of “composition of matters” inventions are
medicinal produ