By: Haris Z. Bajwa JD [intellectual property lawyer with a focus on medical devices and digital health]
This article is a continuation of my previous article providing basic insight into what is patentable from the perspective of mobile health app developers. The sections below provide a framework on approaches/strategies that may be taken to protect your ideas in the form of intellectual property.
When to File for Intellectual Property?
Since the U.S. recently switched from a “first to invent” to a “first inventor to file” system, it is imperative to file a patent application before others disclose or patent similar technology. Therefore, companies that believe that they have developed an innovative mobile application should consider promptly filing one or more related non-provisional applications or a protective provisional application which covers the subject matter of your invention. A provisional application and a non-provisional application are quite succinctly described on the U.S. Patent and Trademark Office’s website:
A provisional application is a quick and inexpensive way for inventors to establish a U.S. filing date for their invention, which can be claimed in a later-filed nonprovisional application. A provisional application is automatically abandoned 12 months after its filing date and is not examined. An applicant who decides to initially file a provisional application must file a corresponding nonprovisional application during the 12-month pendency period of the provisional application in order to benefit from the earlier provisional application filing. A nonprovisional application is examined by a patent examiner and may be issued as a patent if all the requirements for patentability are met.
Minimalist strategies for protecting your IP
If your company’s core product is tied to technology, it is very important to have a robust patent strategy. At the minimum, the strategy should entail filing a provisional patent application which allows up to a year to file non-provisional applications. The cost of filing a provisional application is nominal ($ 65-260 depending on the size of your company) and can be paired with minimal legal fees. If your budget does not allow for even minimal legal fees, one may file a provisional application on their own. An effective way to present information in your own provisional application is to include detailed flow charts that include all steps of your process, in addition to written descriptions and figures. In any written description or additional materials that you include in the provisional application, attempt to use broad encompassing language instead of definitive language. As an illustrative example, use “an embodiment may include” instead of “the invention must contain…” The previous example refers to reduction in the use of what is referred to as “patent profanity” in the written description.
Patent profanity refers to language which may limit the scope of any patents claims that you may later pursue or may impact the allowability of those claims. The benefit of using the services of competent patent counsel is that they should help in reducing the use of patent profanity so that once a patent is acquired based on the subject matter of the provisional application, the allowed claims have the broadest claim scope for enforceability. However, if your circumstances dictate filing the provisional applications on your own, try not to use definitive language and to avoid explicitly referring to any aspects of your invention as being previously known.
An alternative approach for start-up companies that are bootstrapping but have promising technology is to look for attorneys that are willing to provide legal services in exchange for equity. However, in this scenario, the company is still generally responsible for USPTO filing fees which do pale in comparison to attorney fees. While this approach may appear attractive at first glance since it minimizes expenditure on signification IP related expenditures, a company must focus on finding counsel that is competent but also flexible enough to enter these kinds of equity arrangements. Depending on the stage of a start-up, the legal services provider may demand equity from 2-10%. Since these services are often provided on the front-end of a company’s product cycle, most of the equity may be demanded upfront by the attorney unlike the traditional model, where a certain percentage may be divested over a 3-5 year long period.
Keeping in mind the balance of resource allocation in terms of utilizing cash on-hand versus giving up equity, it is imperative that a tech-related company focus on developing their IP strategies early and spend adequate time finding suitable legal counsel. A proactive approach to developing IP strategies will ensure that patent applications or at least protective provisional applications are filed as early as possible, protecting your rights to potentially exclude competitors from the market.
Costs Associated with Patent Acquisition
Patent legal services and filing fees are not cheap. For complicated or nuanced technology, there may be multiple applications that are dedicated to different aspects of your invention. The attorney fees for drafting of a patent application may reasonably range from $8,000-14,000 per application. For software related applications, the reasonable range may begin at $10,000 for quality drafting of a non-provisional patent application. Furthermore, depending on the complexity of patent prosecution (going back and forth with the USPTO to argue that the patent should be granted) after an Examiner at the U.S. Patent and Trademark Office reviews your application, additional attorney fees throughout the prosecution of the application may reasonably range from $3,000-10,000. The attorney fees are in addition to the fees that are owed to the USPTO. For startups and smaller companies, the USPTO provides discounted rates if they qualify as a small entity or a micro entity, which depends on the size of your company and your revenue. Below is an overview of the most relevant aspects of the current fee schedule at the USPTO.
For companies that would like to fast-track their patent applications, the USPTO provides for Track 1 expedited examination. Essentially, by paying a fee ($ 1,000-4,000 depending on the size of your company) to the USPTO, you will be able get a final disposition within one-year of your filing. This is much faster than the 3-5 years, depending on your technical field, that a normal application may take for final disposition. In real practice, I have had clients receive a patent within four months from their filing date. Track 1 expedited examination can be a great tool for companies who want to raise capital based on the innovative nature of their technology or expect rampant copying once their products are released.