I recently reached out to a few clients, friends and former colleagues — all of whom are “IP-inexperienced” — to ask them what intellectual property (IP) answers they might find helpful during their workdays, no matter how basic the question might seem. Each person has a job that is not focused on IP matters but occasionally has IP issues arise. For this post, I selected one question each from the CEO of a software startup, a transactional in-house attorney and a project manager at an engineering consulting firm.
“How do we navigate the patent process? How do you decide whether or not to file for a patent, and is filing for a patent worthwhile?”
Perhaps with some exceptions (such as large, multinational corporations with established research and development (R&D) departments), companies have a wide variety of approaches to navigating the patent process, depending on the size of the company, how often the company is involved in the patent process, whether or not the company has an in-house legal team, and personal preferences among those responsible for patent decision-making.
If your company has employees engaged in R&D efforts for a significant portion of their time, it makes sense to establish a company policy on identifying potentially patentable developments and whether a given development is significant enough to file a patent application on it. If your company is only occasionally confronted with potentially patentable developments, it may make more sense to have an in-house attorney or business executive with the specific responsibility for those matters, and to educate that individual about steps to take when deciding whether to file a specific patent application.
In any scenario, there is one constant: It makes the most sense to have some sort of plan for handling any potential patent matters as they arise, be it through a comprehensive company policy or through a dedicated individual having the responsibility for vetting the matters. If your company is looking for a starting place, reach out to an attorney specializing in patent prosecution matters. This person will be well positioned to work with you to develop a process that is efficient for your company.
Whether filing a patent application is worthwhile is a decision for the company. Common factors to consider include whether the innovation is groundbreaking or incremental; whether it creates potential savings or advantages; and whether there is a need/desire to ensure protection over a new product line or it’s relatively easy for a competitor to “design around” the innovation, thus avoiding infringement. Ultimately the decision is a business one: Are the costs of preparing and prosecuting the application worth the potential for patent protection, as well as what the scope of that protection may look like? But again, experienced patent counsel can collaborate with the company to guide the decision-making process.
“In our industry, we often must use a nondisclosure agreement prepared by our clients and customers. What is the impact of engaging in projects with differently worded NDAs, and how should we instruct our various teams [who often do work for multiple customers] on how to avoid a breach?”
The question here was born from a fear that employees doing work for multiple customers, sometimes at the same time, would either not know what was expected of them or not take appropriate caution to ensure that all applicable confidentiality obligations are being followed.
In this situation, the company should establish a policy to ensure that its obligations under a variety of NDAs with its customers are followed. NDAs will often have similar provisions and the same overall goals: to prevent the customers’ information from being used outside the scope of a particular project and to maintain the secrecy of important business information in order to maintain competitive advantages. To this more general end, establishing and maintaining a companywide culture of protecting the information of clients will go a long way toward complying with NDAs. If employees treat all clients’ information as secret, and if the company reinforces this as a value, the odds of having an NDA breach will diminish.
In a situation where a company accedes to the differently written NDAs of its various customers (for business reasons, industry standards or any number of reasons), it would additionally make sense for the manager having day-to-day responsibilities for a customer’s projects to understand the NDA obligations with that customer. To the extent that any atypical provisions are included, the manager should ensure that his team understands the obligation. Coupled with companywide reinforcement of treating all customer information as secret, the company should be able to effectively comply with its NDA obligations.
“Odd as it may sound, there is a concern, especially among design engineers, that being listed on a patent [as an inventor] will open that person up to being sued for patent infringement. Is there any truth to this?”
This question comes from a situation where one company’s employees collaborating with another company’s employees on a specific project conceive of an innovation that is potentially patentable — such as when an engineering consulting team is working with a customer’s engineering team on a project.
Under U.S. patent law, all inventors who contributed to what is being claimed in a patent application must be listed in the patent application. If the customer decides to file a patent application and the patent attorney preparing the application determines that the consulting employee contributed to a claimed invention, the consulting employee will very likely be listed in the application and asked to sign a declaration.
First, the contract between the companies may specify that one must help the other in protecting IP. If this arrangement is commonplace, a consulting company should consider having its employees agree to aid in securing IP protection as a condition of employment. This could reduce the likelihood that a rogue employee decides for whatever reason to not assist in securing IP protection.
Second, there are procedures under U.S. laws and regulations for a group of inventors to proceed with the preparation and prosecution of a patent application, even if one inventor refuses to participate. The inventor refusing to, for instance, sign a declaration could cause headaches for the companies, affecting the business relationship but only delaying (not preventing) protection.
Finally, it would be exceedingly unlikely for an inventor to be sued for patent infringement for simply participating in the filing of a patent application. This hypothetical fear presupposes an existing patent covering what the inventor(s) thought to be potentially patentable. Simply conceiving of an invention does not constitute patent infringement, which requires actually making, using, selling, offering to sell or importing something covered by an existing patent. The entity controlling the potentially inventive product or process would be the target, if anyone, not the inventor.
In sum, there is no reasonable likelihood of being sued for patent infringement simply for filing a patent application and refusing to participate in the process of securing IP protection could be both futile and harmful to the company’s relationships with its customers. Employee education could go a long way here.
If you have an IP-related question that you encounter in the course of your business but did not know who to ask, email the author, who may address the question in a future post.