

Ask HN: To Patent, or Not To Patent - goodgoblin

We filed for a provisional patent a year ago, and the year is just about up, so we need to decide whether to go for the full patent.  Our lawyer is saying $5k for an opinion of counsel and then up to $10k more for the full patent.  This is basically all of our remaining capital and then some.  The patent, if we get it (82% were rejected last year), would theoretically protect us from competition if we could afford to litigate.  More likely it would serve as a reason for us to get bought.  If we don't go for the patent we won't have protection (not that it would come in for 3+ yrs or whatever), but we could still try and rule the market we are in.  A patent might also help us get funding, if we try and seek it (more funding, right now we've got friends and family money).  Needless to say, spending the rest of our money would put us in a tight spot.<p>Just wondering what HN's denizens thought of our situation or patents in general. thx.
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mixmax
I've started two companies that took out patents, and thus have seen this up
close. My experience is:

\- The market doesn't care about patents. Whether your product is good or bad
a patent makes absolutely no difference to a customer.

\- Competitors care very little about patents. They know the cost of patent
litigation, and that you probably can't afford it. Even if you could they
would probably be able to strike a deal.

\- Investors, on the other hand, do care about patents. The thinking seems to
go along the lones of _I have no idea which company to invest in, but the ones
that have a patent must be the smart ones. So those are the ones I'll invest
in_. - This is from Denmark, and may be different depending on your meatspace
coordinates.

\- Patents take time and focus. Patenting takes the focus off your product and
selling it, and patents don't get you customers.

I would say that if you're gunning for investors get a patent, if you're not
don't.

Hope it helps.

Edit: bonusinfo: If you have to go out and get a job at some point later in
life a patent definitely helps. Employers are pretty impressed when you can
say that you're so smart that you've taken out a patent...

~~~
jwilliams
_Investors, on the other hand, do care about patents._

This is one reason to keep patents provisional as long as possible - you get
the investors to cover the capital outlay of executing the patent.

If you launch into the WIPO "International Patent" process, for an upfront
cost (US$5k or so - varies a lot on circumstances) you can extend the process
by quite a bit - up to 18 months iirc. My bus partner wrote a blog on this
after we'd done rounds of meetings with attorneys :
<http://www.jodoro.com/2008/09/patent-discussions.html>

~~~
gravitycop
You're saying that you can extend your _U.S._ filing date [EDIT: what I mean
here by "U.S. filing date" is the deadline for filing the actual U.S. patent
application] by filing a (essentially _international_ provisional application)
PCT? That doesn't sound correct, based on this:
[http://robertplattbell.blogspot.com/2007/10/foreign-
filing-i...](http://robertplattbell.blogspot.com/2007/10/foreign-filing-is-it-
worth-it.html)

[EDIT] I stand corrected. Apparently, there is an international (PCT) route to
U.S. patents. <http://www.wipo.int/pct/en/pct_strategies/the_third_way.pdf>
[PDF]

 _the “international route” of the PCT to U.S. patent issuance. [...] THIRD
WAY IS BEST WAY This Third Way of using the PCT as a matter of domestic U.S.
patenting strategy gains many advantages for the applicant to control the
timing of search and examination of the U.S. application, if one begins with a
Provisional Patent Application._

~~~
jwilliams
The filing date always stays the same (ed: Sorry, I meant priority date there)
- but, yes, that's my understanding:
<http://en.wikipedia.org/wiki/Patent_Cooperation_Treaty>

USPTO has a diagram here:
[http://www.uspto.gov/web/offices/pac/mpep/documents/1800_184...](http://www.uspto.gov/web/offices/pac/mpep/documents/1800_1842.htm)

Under their system, it the whole process (to what they call the national
phase) can be 30months - it varies from country to country, but 30 seems to be
common. <http://www.wipo.int/pct/en/texts/pdf/time_limits.pdf>

~~~
gravitycop
OK, thanks. I should have checked on this information before posting. Sorry.

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davo11
I'm in the same boat, my provisional runs out in April, and am wondering what
to do. I lodged the provisional myself and save a few $K.

Here's my current thinking, over the course of the patent it will cost around
$250K or more over 20 years. If I had $250K now would I spend it on my patent?
Right now, I'd much rather have the $250K so from the good investment point of
view - the answer is no.

What about the possibility of someone else patenting it? Well since the
provisional has been lodged I don't think that's possible once the product is
in the public domain, so from that angle I'm safe.

Can someone reverse engineer the patented bit? If they can what investment
would they have to make to build a competing product, i.e. are there any other
bits that aren't in the patent but are hard / risky. If a competitor has to
make a large investment to catch up to you, then they may be better off just
buying your company.

Will this be the only invention you ever make? If you're young and you've got
something patentable already then most likely it wont be your last. It's not
my first and I know it's not my last, once an inventor - always an inventor.

Someone mentioned it's good to have a patent on the resume, from my experience
it can scare the hell out of some employers, so that's a bit of a 2 edged
sword.

Perhaps the bit that get's stuck the most in my craw is that I'd be paying
thousands of dollars to some patent guys who sit in a nice office and wear
expensive suits and silk ties while I'm busting a gut making a startup, it's
petty I know but it really gives me pause. I figure if they have all that
money then there is a lot of cream on top of the patent industry.

The other thing to consider is how much time it takes to write a patent
application. I know for myself it was a few weeks to actually write the
provisional (and this was time well spent as I defined what I'd actually
invented and found out a few other things along the way). It also takes time
to work with the patent guys, don't underestimate this. You have to have
meetings, review there work, make changes and so on.

I figure if my products successful, then by the time it reaches the point
where I had to worry about patent infringements and so on I will have made
more than enough money for me and I'll be doing this to grow to the next
step.It usually takes about 5 years for a patent to be approved, 5 years is a
long time in software.

The conclusion I've come to is it's a big boys game, and if you want to play
then you have to pony up the cash, either get the cash or get investors who
have the cash otherwise do what you can to protect yourself and move on. Of
course it depends totally on what you're patenting - if it's a major
breakthrough then it may be worth getting investors. If it's incremental then
execution probably matters way more than whether or not you have a patent.

hth.

~~~
dirkstoop
I wouldn't worry too much about the expensive suits and roomy offices. When we
were first bootstrapping (no investors, angels or the like, just some money
scraped together) the first thing we spent money on was (expensive) legal
advice, mostly because we knew it was the only thing we needed right then that
we couldn't teach ourselves quickly enough.

If you're still in startup mode, the following two questions should help you
make the decision:

\- do I need it right now?

\- can I spare the money right now, if not: can I make a deal with my IP
attorneys where they agree to bill me later? (just think about the money you
need to spend the coming couple of months, the total estimated cost over 20
years is completely irrelevant at this point)

If both questions are answered with a 'yes', do it. Because if you need it
right now, it doesn't matter how inconvenient the distraction from working on
your product is right now, as a founder you'll just have to deal with it. And
if you don't need it, don't do it, because I'm sure you can find some other
thing you need to do 'right now'.

Don't let the idea that you already spent money on the provisional patent
cloud your judgement about whether you should put more money into this. If you
can't come to a rational decision, and the prior expense is what pulls you
over the fence emotionally, it's probably better to cut your losses.

Good luck, these kinds of decisions are hard, especially deciding whether you
'need' something. That's something only you can assess, it could help to get a
second opinion from another IP attorney, preferably one that doesn't have a
financial incentive to sell you on going for it.

\- Dirk

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natch
One patent is not likely to be worth much. If you can put together a small
cluster of them, it's much more compelling for an investor/buyer. Depends on
what kind of patent, though.

'course, this isn't the best time to bet on getting funding, patents or not.
Probably better to focus on finding an actual revenue stream.

And have you really done a diligent search for both existing patents, and
prior art? Don't rely on your lawyer to do this; he/she has a financial
disincentive to do anything that would discourage you from attempting to file
a patent (I used the word "attempting" for a reason: your lawyer probably has
things set up so that even a mere attempt will result in fees, whether that
attempt is successful or not).

Also know that some patent lawyers file patents just to get the money for
filing them. Read carefully, this point is distinct from the one in the
previous paragraph. The fact that a patent is filed and eventually granted,
does not mean it is a valuable patent. Your lawyer's job is generally not to
judge the technical or business merit of the patent, unless you have
specifically set up your relationship with him/her to provide an incentive for
that. So be aware that your patent might prove to be worthless. While even a
worthless patent will grease the skids with some investors, at least go into
this with your eyes wide open.

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lsc
I dono... do you think you can compete better by marshaling lawyers? or by
implementing a product better and sooner? How much of an opportunity cost does
that money represent? (I mean, do you need that funding to run?)

The big thing I see is that it takes money to be a patent troll. I guess if
the patent is really strong, you might be able to get your lawyers to work for
a cut of the proceeds (maybe ask your lawyer?) but that sounds unlikely to me,
not that I know anything about patent trolling. if your resources are like
mine, I'd not worry about the patent, and I'd focus on making something that
is worth copying.

But yeah. I'd argue that patent trolling is a lot like starting fist fights-
don't start if you can't win. If you loose, you get nothing. You just get a
black eye and look like an asshole. On the other hand, if you build a product
and then get crushed by copycat competition with better resources, eh, you
still learned something, and you still look good. You created something that
was worth copying. At the very least it helps you get your next job.

But then, Maybe you have access to cheap lawyer time like I have access to
cheap SysAdmin time. that'd change the equation.

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shmoo
Some large companies only patent defensively, in order to prevent other
companies from patenting their ideas and then suing them. Enforcing patents is
difficult.

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mikeyur
I don't have any experience personally, but I would say just work on your
killer product. If a competitor comes along and you're already established as
the leader it won't matter.

Save your capital.

Just my $0.02

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wavesplash
An alternate option is to give up some ownership of the patent for reduced
cost and labor. Have you guys talked with IMSciences? They cut you a deal for
a portion of the patent ownership and depending on the deal you cut can write
most of it for you. (I don't work for them, nor have I filed anything with
them but I have heard good things about one of the partners).

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rms
Write it yourself -- the provisional, especially if it was lawyer authored,
should be almost good to go.

~~~
goodgoblin
interesting idea - I'll try and find out how much the pure application is.

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vaksel
if you can't afford it, forget about it.

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volida
well assuming you have a provisional patent and asking here, shouldn't you say
what the patent is about?

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dctoedt
One question to ask is whether your product or service is even patentable in
the first instance. Ask your lawyer about the court decision in the Bilski
case, <http://www.cafc.uscourts.gov/opinions/07-1130.pdf>, which put some
pretty tough restrictions on the patentability of software.

------
rrhyne
Software patents are evil.

