As patent brokers, we get phone calls and emails every day that include three common misconceptions that people have about patents, patent terminology, and patent value.
♦ Patent Pending: We are amazed at how many inventors write to us and claim they have a “Patent Pending” or worse-yet a “Patent Pending patent!” “Patent Pending” is not a thing. It is an adjective that describes a product. Only a product can be “Patent Pending” – never a patent. The definition of “Patent Pending” is in “Wording attached to a product or service indicating that there is a patent application for the invention behind this product or service that was filed with the Patent Office. If that patent application is rejected, the wording must be removed from the product or service. If the patent application is approved and a patent is granted, “Patent Pending” must be replaced with “U.S. Patent No. XX,XXX,XXX”.
A company comes up with an invention, and they file for a patent for that invention. The company then goes to market with a product based on that invention. Since all the company has is a patent application, it cannot mark the product with a patent number. So, they mark the product “Patent Pending” to let the world know that a patent is in process and to – ideally – scare off competitions from jumping into the market with a directly competing product!
Once the manufacturer of this product is granted a patent, “Patent Pending” is replaced on the product with the patent number. This is known as “Marking” or “Patent Marking” – also in the Glossary. It lets competitors know that the product is covered by a patent. If a product is NOT marked, and competitor goes to market with a similar product that infringes the patent, the patent owner’s claim is weakened because the patented product was not properly marked!
An inventor never, never, never has a “Patent Pending” or a “Patent Pending patent!” Never! An inventor has either a patent application or a patent. To be more specific, a Provisional Patent Application, a Provisional Patent Application, or a granted Patent. An inventor never, never, ever, ever has a Patent Pending!
♦ Small Nation Patents: We are contacted regularly by inventors who have patents in small countries – Portugal, Indonesia, Australia, Columbia, you name it. And we have to tell them that their stand-along single-nation patent has NO commercial value. They are sometimes very upset. We do not tell the owner of a Swedish Patent, or an Israeli Patent, or a South Africa Patent that they need to contact us when they have a U.S. Patent because we are Ugly Americans*. We tell them to contact us when they have a U.S. Patent because the U.S. is the world’s largest economy.
Let’s take the case of a South African Patent. A patent is a public document, so once South Africa grants Joe Smith a patent, it is a public document for the world to see. Company X finds that patent, sees the potential in it, and immediately goes to market with a product based on that patent. As long as Company X does not manufacture that product in South Africa, or sell that product in South Africa, Joe Smith can do nothing! Company X can sell the product in the U.S., all of Europe, the Far West, and South America – over 150 countries. And as long as Company X does not manufacture or sell its infringing product in South Africa, the inventor can do nothing – except maybe send the company a cease-and-desist letter, which the company will ignore.
Now, if Joe Smith had applied for and was granted a U.S. Patent, Company X would have to think twice about going to market with a product based on Joe Smith’s patent since it would be prohibited from manufacturing or selling a product based on that patent in the largest global market – the U.S. Selling a product based on the U.S. Patent would make Company A liable for a patent infringement lawsuit in U.S. District Court.
And that is why we tell owners of small nation patents to get back to us when they have a U.S. Patent. It is simple a matter of math. Here are the largest economies on our planet:
▪ USA
▪ China
▪ Germany
▪ Japan
▪ India
▪ UK
▪ France
▪ Italy
▪ Canada
▪ Brazil.
If an inventor secures a U.S. Patent, a European Patent (that designates Germany, the U.K., France, and Italy), and a Canadian Patent, he or she would have patent coverage in over half of the 10 largest economies with just three patent filings. Again, it is a question of numbers.
♦ PCT Patent Application: While it is a practical and powerful tool, many inventors do not really understand what a PCT (Patent Cooperation Treaty) Application actually really is. Let’s start with what it is not. It is NOT immediate global patent protection. We cannot tell you how many inventors write to us about their PCT Patent Applications believing that they have global patent protection!
All a PCT Patent application does is (1.) establish a Priority Date for your patent filing, and (2.) make it easier to file for multiple national patents. It does NOT give you patent protection. You only have patent protection in those countries in which you used your PCT Patent Application to file for a patent in that country. If you do NOT use your PCT Patent Application to file for a patent in Canada (as just one example), you do NOT have patent protection in Canada and any company is free to manufacture and sell a product based on your invention in Canada.
Filing a PCT Patent Application is smart, and it adds value to a patent family or portfolio, but you need to know what it is – and what it is not. A company can buy your patent family that very wisely includes a PCT Patent Application and use it to apply for additional patents in countries where it does business. But get your patent family to market because a PCT Patent Application is only good for 30 months.
* We borrowed the term “Ugly American” from The Ugly American, a best-selling novel (and later movie) of the same name.
Alec Schibanoff is Vice President of IPOfferings LLC, a leading patent brokerage firm. In addition to patent brokerage, IPOfferings offers patent valuation services and has an extensive list of patents for sale at its website.
