Patents – are they worth the time and expense?
8 June 2023
This article was originally published by Business Weekly
League tables are now regularly published, with companies proudly publicising the number of patents they have applied for. Nevertheless, some patent-rich businesses falter or succumb to legal battles with larger rivals. This raises an important question: how can businesses protect themselves from such predators, and are patents worth the time and expense devoted to acquiring them?
No doubt many IP professionals are screaming “yes” in response to such a question (and not only because it is their source of income). What, those same professionals might say, would be the point of years (often) of hard work and considerable expense (very often) if as soon as the product is placed in the market anyone can “copy” it without impunity. The benefit must, arguably, lie in the registration of rights to obtain the monopoly (albeit limited in time).
However, that is a very simple answer to what is a not a simple question. Whether the patents are worth the time and expense is dependent on the business model, the product and its value, the market and the end game. Yet, to get the most benefit from anything and particularly looking beyond the lifetime of a patent, they should also be considered as part of a wider overall IP strategy.
Here are some crucial considerations when evaluating the value of patents:
- Prioritise innovation and differentiation
Focus on continuous innovation to stay ahead of larger rivals. While patents can offer protection, it is essential to differentiate products or services through unique features, customer experience, or brand positioning. Building a strong reputation will help provide a maintainable advantage which can outlast a patent.
- Market awareness and surveillance
Monitor the market and competitive landscape to identify potential infringements and take prompt action where required. Make sure your company stays informed about emerging technologies, patent trends and potential infringements to adapt and refine your IP strategy accordingly.
- Collaboration and partnerships
Consider strategic collaborations, licensing agreements or partnerships that can help influence IP assets while mitigating risks. Exploring mutually beneficial opportunities with industry players may strengthen your position.
- Defensive patenting
Consider defensive patenting strategies to deter potential litigation. Acquire patents not only for offensive purposes but also as a defensive mechanism to protect your business from patent infringement claims by larger rivals.
- Seek professional advice
Consult with IP attorneys or experts. They can provide valuable insights and assist in making informed decisions regarding patent acquisition and protection.
- Comprehensive Intellectual Property (IP) Strategy
Develop an accomplished IP strategy – be willing to take into account IP/quasi-IP rights beyond patents, for example trade secrets, design rights, trade marks.
What about predatory organisations?
Legal battles with rivals are not going to be taken on lightly. Everyone recognises that litigation, especially patent litigation, can be costly and time-consuming. Notwithstanding that, why bother with patent (or indeed any other IP) registrations if one is not willing to put them to use against infringers?
Of course, evaluation of potential risks and rewards of engaging in legal battles is crucial so take legal advice early.
In the face of predatory organisations, also think laterally, the solution may not lie in traditional litigation with a decision in the hands of a judge but could be, for example, in alternative dispute resolution methods or licensing agreements which find a practical commercial solution.
The fact that businesses still seek to register patents and indeed shout about the fact that they do speaks for itself, organisations perceive them as having value. A business asset which can (i) be security for lending; (ii) give value to a business; (iii) used as a commercial commodity when dealing with others; and (iv) be disposed of for value.
So, there can be no doubt there is much to be argued in favour of the time and efforts (including monetary) to acquiring them. However, patents should not be pursued in a blinkered manner as a solitary aim. They should form part of the overall business and intellectual property strategy.
By understanding the complexities of the patent landscape and seeking professional advice, you can make informed decisions to secure your business’s future in the midst of intense competition.
The content of this article is for general information only. It is not, and should not be taken as, legal advice. If you require any further information in relation to this article please contact the author in the first instance. Law covered as at June 2023.