March 01, 2014 • By Dennis Beaver
Obtaining a patent is a virtual guarantee that some company will phone one day and offer to buy or market the item, and is a sure bet on greatly improving your lifestyle.
We’ve all heard something along those lines. But is it really that way?
“When audiences are asked that question, most people will say yes, of course a patent is very valuable, and having one could easily mean the difference between an ordinary life, or one of wealth and ease,” comments patent attorney Jim Duncan of Bakersfield.
“There is a great deal of romance and wishful thinking surrounding patents. So, for your readers who are about to pour thousands of dollars into some invention promotion company, assured that their idea will make them millionaires, allow me to rain on their parade,” Duncan tells You and the Law.
“You can build the better mousetrap, and not have the world beating a path to your door. Patent lawyers just do not see that happen. Merely getting a patent does not mean that you will make any money. It generally means that you will lose money,” he said. A large percentage of patents simply languish, dying a slow death at the U.S. Patent Office. It is important to keep these figures in mind:
• The least amount, from start to finish, in obtaining a patent using a patent attorney runs around $10,000.
• Statistics from the U.S. Patent Office show that something like 70 percent to 75 percent of patents issued have never generated enough income to even pay for the cost of the patent.
“Picture yourself standing on top of a gold mine but no one ever taught you how to use a shovel. It’s the same thing with a patent,” Duncan said. “The idea, your concept, your product can indeed be valuable, but what are you going to do with it? Do you have the business skills?”
These are the first questions he asks someone coming to see him for a patent:
• Assume that I can get you a patent, what are you going to do with it?
• Do you have a business plan? Is it your intention to build and sell the item yourself?
• Or do you hope to find someone to license it?
“Every Tuesday when the US Patent Office releases the list of new patents, there are companies who can’t wait to get their hands on it, and then begin contacting the patent holder, offering to market the product, sell you a fancy plaque of your product, include it on a registry — you name it, they’ll try to sell it. Almost all of this is worthless, and some downright crooked. Typically, invention promotion firms will come running to you, and believe me, they are masters of flattery. You will hear glowing comments about how great an invention you’ve got and the millions you’re going to make by hiring them. They have been known to offer the patent holder a free trip to their offices, but it is anything but free,” Duncan warns.
“Here’s why,” Duncan explained. “The hidden danger with virtually all of these invention promotion firms is that, yes, they will offer to market your product — but for a fee into the thousands of dollars, and then do virtually nothing. In the business world, anyone who is serious about marketing your invention has to have a stake in it — financial exposure — real risk to their own money. But if they make money no matter what, then they don’t have to believe in your idea at all and the chances of them doing anything of value are low to non-existent!
“It is an extremely rare occurrence for a patent holder to be contacted by a legitimate firm wanting to be licensed and manufacture the item. I have been a patent attorney over 15 years. One client has had a patent for eight years. I just got a call from a company which appears to be serious about licensing the patent. But this is the first time I have ever been contacted by someone who has seen a patent issued and now wants to license it,” Duncan observes.
“Dennis, I would like your readers to understand that there are great ideas with enormous market potential which cannot be patented. Some things become a fad. If you can catch that wave, you make a ton of money, fast. Remember the Pet Rock? Practically everyone bought one,” Duncan said with a broad smile.
Dennis Beaver practices law in Bakersfield and enjoys hearing from his readers. Contact Dennis Beaver.