Candid photo from our recent SPSG workshop, at our Pasadena, CA headquarters. We are thought-leaders in patent search best practices, and have designed our workshop to create a new industry standard in patent research education. Pictured L-R, Kathryn Thompson (Chicago office, Patent Search Associate | Johns Hopkins and UPenn grad) and Jane Yoon (D.C. office, Patent Search Associate | M.I.T. and Harvard grad). Onward!
At SPSG, we are the patent research destination for many start-up companies. This article is part 1 of a multi-article series focused on ways we have seen, first-hand, how effective patent research can benefit start-up companies. Specifically, in this case, we will focus on early-stage invention discovery and patentability studies, and a particular start-up client of SPSG.
It is often the case that the IP position of a new technology can greatly impact its commercialization success / potential. It is imperative that a start-up perform early-stage IP assessments, prior to investing substantial resources, time, and money into a new technology. Early-stage IP research can help precisely calibrate a technology against the competitive environment, which may result in, for example, rethinking the technology’s application, which is certainly a less costly decision to make when done at an early stage. At SPSG, we often partner with our start-up clients, assisting them throughout the invention discovery and commercialization process. Aside from our IP expertise (former USPTO Examiners, in-house searching, law firms, etc.), our technical backgrounds (from leading science and engineering universities – MIT, Rutgers, PSU, etc.) help us to become intimately familiar with the technology and thus able to effectively comprehend what competitors are doing and where there could be opportunities to carve a niche (this will be covered in-depth in our next article).
Once an early-stage technology is developed, we find that quicker, more cost-effective patentability studies can provide useful guidance in most cases. While a patentability study will not generate comprehensive data in the form of what the current state-of-the-art is, a patentability study will answer the question or whether the early-stage technology is taught in the prior art, and who some of the major players are in the field (which can be useful in determining licensing partners, etc.). If dead-on prior art is located at this early-stage, this can provide powerful guidance to the start-up, enabling a quicker pivot or rethinking of the technology, thus enabling smarter decision-making and time-saving, which every start-up needs to maximize. Partnering with an IP search firm early in the invention discovery process is thus critical in understanding how the early-stage technology fits in the patent landscape and whether it makes sense to pursue commercialization of the technology, etc.
We recently had the pleasure of working with Colorado-based energy start-up, Affian Solutions. Here is what their CEO has to say about our work together:
“When prioritizing between start-up/business duties– outsourcing of invention discovery and patentability tasks is valuable. [SPSG], with its thorough and quick results, expedited our invention process– helping us make important decisions faster, making pivots earlier.” – Kyle Prawel, CEO, Affian Solutions
There has been a lot of discussion recently, via GAO reporting (http://www.gao.gov/products/GAO-16-490) on the USPTO and various Patent Quality Conferences, that bring into question and discussion a number of issues at the USPTO, from logistical and procedural improvements, to broad patent quality, etc. One aspect that caught our attention was prior art searching at the recent Santa Clara–Duke Law Patent Quality Conference:
Of note: “Assistant GAO director Robert Marek next discussed highlights from the agency’s studies of patent quality and prior art search. These studies relied heavily on a survey that produced 2669 USPTO examiner respondents. The survey found that 70% of examiners reported having insufficient time to examine applications; the majority reported wanting more time for prior art search…”
…”On the issue of search, the GAO recommends that the PTO develop guidance of what constitutes a good prior art search; identify key sources of NPL; monitor search quality; and assess the time examiners need for search…”
We found the foregoing excerpts to be profoundly on point. A lot of our team came from the USPTO at one point or another. We all conclude that prior art searching at the USPTO was not generally emphasized. Search best practices were taught in a piecemeal fashion, if at all. The idea in many cases was to find workable prior art in the quickest manner possible. Of course, the goal was to find the strongest prior art, but with time constraints, and the lack of professional search training, this goal was not consistently achievable. Patent examination at the USPTO is substantially more condensed and efficient when the strongest prior art is found and applied during prosecution.
In general: Professional and comprehensive prior art searching ==> Strongest prior art ==> More efficient patent examination process ==> Stronger patents issued
From our standpoint, as professional searchers, we have seen the difference between how we searched as Examiners, to how we search professionally here at SPSG. The difference is substantial. For example, a large component of our work comprises invalidity searching. One of the first steps when tackling an invalidity study is to examine the prosecution history of the patent in question. The first section we typically read is the Examiner’s search history – where did they search, how extensive was their prior art search? More often than not, the Examiner’s search is lacking, and appears to be “quick and dirty” rather than indicating an effort to locate the best prior art with a comprehensive search strategy. As a result, we typically find substantially relevant prior art, missed by the USPTO during prosecution, in most of our invalidity searching. A less-than-desirable search by the Examiner during prosecution thus impacts the validity and strength of the patent.
From the same patent quality conference, we could not agree more with the EPO, per below. Searching should be the cornerstone of patent examination. Effective and professional searching will help to streamline examination and ultimately improve patent quality.
“EPO Patent Quality Director Alfred Spigarelli’s presentation was titled: “Patent Quality: Get it Right the First Time.” He emphasized the human resources component of the patent quality equation, from the hiring standards the EPO applies (e.g. examiners must be able to actively work in three languages), to the training each EPO examiner receives, to the low turnover rate. Search is viewed as the cornerstone of the patent examination process, with 60% of time dedicated to search.”
What seems like a straight-forward idea can be quite complex to describe in a manner that distinguishes its novelty from prior art. Particularly in the mechanical arts, where certain features have very few terms to describe them (e.g., flanges or clasps), it can be difficult to distinguish the idea from prior art. This can be advantageous. For example, when an examiner or defendant conducts a search for prior art, exceptional large result sets due to the commonality of terms in references make identifying the best prior art difficult, and therefore may not be found at all. However, given enough time, a determined opponent, such as a defendant on the hook for a potentially large verdict, may find prior art that renders the invention unpatentable. Therefore, having a thorough prior art search before filing a patent application on these “simple” inventions may be the best defense against an eventual validity challenge. Because a thorough search may take significant time to complete, retaining an expert search firm with proven techniques both reduces costs and improves the quality of results, thus increasing the value of the prior art search. For example, a search firm thoroughly familiar with the classification systems will efficiently narrow down results to the most relevant subclasses. Further, a sophisticated search firm is capable of crafting complex search strings that reflect novel interaction of features that distinguish the invention from prior art without becoming dragged down by those generic search terms like flanges or clasps. SPSG understands these techniques and has expert searchers experienced in searching “simple” inventions and returning the best results. We emphasize not only the best quality but also efficiency to provide our clients with the most value.
For more information, please feel free to contact our offices at 626-432-7292 or email at firstname.lastname@example.org
Design patents are frequently enforced against operating entities, either alone or in combination with utility patents. Thus, successful operations should be careful to obtain freedom to operate searches that include design patents. A freedom-to-operate search identifies active patents having claim language that your business may infringe upon. Further, a freedom to operate search has the additional layer of examination of expired prior art, which are in the public domain, and are thus free to use. Optimally, a freedom to operate search should include every country in which the technology is practiced. To ensure thorough searching of design patents in every country, the search should include both U.S. and international classification. The Locarno International Classification System is an international classification for designs that is administered by the World Intellectual Property Organization. Although it is substantially parallel to the U.S. patent classification system. However, the U.S. patent classification system has far more subclasses, thus requiring careful identification of the best fit subclasses in both systems to ensure a thorough yet efficient freedom to operate search. Having a freedom to operate search provides your business with a reassuring view of the closest design patents that may be enforced. It can save significant expenses by either providing you with the belief that there are not any design patents enforceable against your business or by identifying potentially concerning patents to allow for upfront licensing instead of costly litigation.
In recent years, many new services have appeared offering crowdsourced patent searches. Essentially, the search is listed as a competition where anyone may submit search results in hopes of winning the cash prize. Sometimes the search competition requires the searcher to have particular skills or knowledge, but generally the searchers receive no training and are not required to perform their searches according to a particular search philosophy and/or standard. In contrast, specialized search firms, such as Sherman Patent Search Group, invest significant training in their teams to ensure high quality results and expect the searchers to adhere to a well-developed search philosophy. Another difference is that crowdsourced searches operate by individual searchers competing against each other. Search firms, on the other hand, often assign multiple searchers to a search to ensure as comprehensive coverage of the field as possible. Finally, to increase the chance of finding perfect prior art, crowdsourced searches often take as much as six weeks to complete. SPSG, however, is often able to accommodate clients needing results much sooner. Although some searches are suitable to crowdsourcing, complex, urgent searches may be more appropriate for specialized search firms such as SPSG.
Typically, patentability searches are ordered prior to filing a patent application. They are useful for locating prior art relevant to the novelty of an invention. However, patentability searches ordered at a later stage are also advantageous. Ordering a patentability search closer to allowance increases the business value of the patent in several ways. First, it provides a simple list of references to cite in an information disclosure statement to ensure these references are on the face of the patent at issuance, thus weakening the value of these references in invalidity proceedings. Second, a late-stage patentability search provides an updated list of competitors potentially infringing the soon-to-be issued patent by listing similar applications filed after the application date of the invention subject to the search but only recently published. If the patent owner intends to enforce the patent, this list of competitors provides a starting point for pre-enforcement investigation. It is important to note that for this purpose, the search firm should not use the earliest priority date of the invention subject to search so that all relevant prior art is found. Third, a late-stage patentability search provides valuable insight into the strength of the patent by finding potentially invalidating prior art before issuance so that amendments or continuing applications may be filed to guard against that prior art. Thus, a patentability search conducted shortly before allowance can easily increase the value of the patent.
Patentability searches have many benefits, some less obvious than others. These benefits include saving prosecution costs and making informed business decisions regarding pending applications. Patentability searches also have risks that are less than obvious. Knowing these benefits and risks enable you to distinguish a high quality search from a low quality search. Moreover, understanding what to expect from a high quality patentability search enables anyone, even those with limited patent law knowledge such as inventors and business executives, to communicate effectively with law firms representing them.
Beyond providing a sense of the likelihood of obtaining a patent on an invention before filing an application, patentability searches ordered after filing an application indicate the value of continuing prosecution. Perhaps a new law firm has been retained to continue prosecution or the patent application has been assigned to a new entity. These organizations may find value in a new patentability search to identify whether the $5,000-10,000 in attorney fees needed to pursue prosecution will result in a valuable patent. Many assert a “wait and see what the examiner cites” philosophy instead of abandoning an application since the examiner may not find relevant art or may suggest amendments that result in allowability. But this is a costly gamble. Even if one of these scenarios plays out, the resulting patent is unlikely to be valuable because either the patent will be susceptible to invalidity proceedings in district court or at the patent office or the patent will be so narrow as to be unlikely to be enforced. Moreover, once an application has received multiple office actions, so much has been invested that abandoning the application may be too difficult to swallow. Whether to continue prosecution, at the cost of several thousand dollars in attorney fees, is an important decision that would be strengthened with a patentability search early in the process.
Another potential benefit of a patentability search is the search may provide an indication of whether a freedom to operate search would be a beneficial follow up. Even if excellent prior art is found in the patentability search, resulting in a decision to abandon or not file an application, an organization may still choose to continue with development and distribution of a product. A patentability search may reveal patents in effect that could be enforced against the product. Although a patentability search is nowhere near comprehensive enough to assure freedom to operate, if patents in a patentability search are revealed to be troublesome to operations, the patentability search may be used as justification for a freedom to operate search.
Patentability searches further benefit patent applicants by shortening prosecution. When an information disclosure statement (IDS) is filed with the application, the examiner has a jumping off point and therefore will be unlikely to need as much time for searching. Moreover, the examiner may issue fewer office actions since the references in the IDS have already been addressed. Thus, the patentability search saves significant prosecution costs and attorney fees.
Risks in patentability searches exist beyond just discovering that an invention is not patentable. First, in analyzing a report, one must be careful to not dismiss references for the wrong reasons, such as functional limitations. A quality search firm provides only the most relevant prior art. Even though you may intend your invention for a particular use, that does not provide a meaningful distinction from prior art. Every piece of prior art cited needs to be carefully considered. Second, the references in the report must be read in combination. Reading each reference in isolation may lose the bigger picture of how two references combine to render the invention obvious. Finally, the patentability search should not be used as a substitute for a freedom to operate search. As stated above, patentability searches may provide an indication that a freedom to operate search would be beneficial, but it is not a substitute since the searcher employs different search techniques for a freedom to operate search.
Patentability searches are powerful tools for business decisions. They easily save several thousand dollars in attorney fees, but they must be carefully analyzed. This is much easier if the report is concise yet thorough. SPSG carefully evaluates hundreds or even thousands of references to compile its custom report of only the most relevant prior art and includes project notes to summarize the findings. Such a quality report provides the above stated benefits.
Effective prior art searching is a critical business need for law firms, large and small organizations, and even individual inventors and startup companies. Ordering the right search at the right time results in maximizing profit from your patent portfolio. Ordering the wrong search may result in more art (and thus higher search costs) than necessary or less art (and thus higher business risk) than necessary. For example, ordering a landscape search when you really only need a freedom-to-operate search could be more costly than you need. Further, ordering the search at the optimal time is essential to maximizing the benefits. For example, patent owners may miss out on the opportunity to amend weak claims if they find themselves subject to an inter partes review. Ordering an invalidity search before this risk presents greatly reduces chances of a potentially catastrophic end to their patents. Therefore, having a keen sense of which search to order and when to order the search greatly benefits your business.
Infringement/Clearance and Freedom-to-Operate Searches
Important searches for innovative businesses are infringement/clearance searches and freedom-to-operate searches. These searches are useful for an operating business interested in obtaining a list of patents that may be used to sue them. The business provides its search firm with a description of a product, method, or other patentable idea they plan to use in operation. The search firm will then identify patents with claim language that may be infringed upon by that concept.
The difference between these searches is the infringement/clearance search returns only active patents, whereas the freedom-to-operate search also returns expired patents in the public domain. If a patent is expired, it most likely will not be used to sue a business (although this issue is quite complicated and there are situations where this is not true which are beyond the scope of this article). Moreover, depending on the disclosure, an expired patent may indicate that subsequent patents are susceptible to invalidation. Thus, the infringement/clearance search is more cost effective but does not provide the assurance or advantages that a freedom-to-operate search provides.
The timing of infringement/clearance searches and freedom-to-operate searches is critical to maximizing the benefit of these searches. The best time depends on your current operations, goals and future plans. Some choose to order the search before beginning an operation. This timing is beneficial when you have a product or operation you expect to be exceptionally profitable and has been in the market by others, in some fashion, for some time.
For example, perhaps you have improved the design of a baseball bat. Bats have been for sale for a significantly long time and therefore may be subject to quite a few patents covering baseball bats. Moreover, you have reason to believe major league baseball teams will be interested in this product, so you expect it to be extremely profitable. Thus, you may choose to order an infringement/clearance search early. Alternatively, some choose to wait until a product has already been marketed and started earning profits. A business unsure of the success of a product may choose this route since an early search for an unprofitable product would be a waste of money. Waiting until after an operation has been exceptionally successful and is well known in the market may be too late since owners of patents you infringe likely already know of your existence and will require a much higher licensing fee to settle than they would have prior to the operation earning large profits.
Landscape and State of the Art Searches
A landscape or state of the art search is valuable to businesses interested in keeping their patent portfolio as comprehensive as the market allows. A landscape search provides an overall perspective of all prior art in a specific technology field. It often reveals “white space” or opportunities for investment through filing patent applications. This search may be used to direct research and development to areas of technology allowing for the most potential profit since it reveals whether room for filing patens exists in the specific technology.
Landscape searches should be conducted frequently to maximize their benefit. Because technology markets change rapidly, white space, or areas open for innovation, change often. To stay on top of these opportunities, businesses need to identify specific technologies on a regular basis and order landscape searches in these areas immediately to avoid losing the opportunity to a competitor. Moreover, iteratively updating the landscape searches could provide insight into how hot the area is with competitors and provide insight into how much your research and development department should focus on the specific field.
Innovative operations often consider patentability searches for specific inventions. This search returns prior art relevant to the novelty of an invention, which is a basic requirement at the patent office for patentability. If an invention is not patentable, then patent lawyer fees, application fees and other costs, often far exceeding $10,000, would be wasted. Some search firms provide two types of patentability searches: one that exhaustively searches U.S., foreign and nonpatent literature databases and a “knock-out” patentability search that only looks at high-level art on a more precise scale (i.e., “102” art). The knock-out patentability search is not as comprehensive as the exhaustive patentability search. Thus, the knock-out search is more cost effective, but also more risky since there may be less-precise art that the patent office may use to reject a patent application on an obviousness basis. The exhaustive patentability search is more likely to return this less-precise art.
The timing of a patentability search is particularly sensitive. If a patentability search is ordered too far in advance of filing a patent, then relevant prior art published after the search but before the filing could result in the patent being anticipated and thus the patent lawyer fees, filing fees, and other costs, often exceeding $10,000, being wasted. Ordering a patentability search too late could mean missing your window for filing you application. Therefore, closely monitoring your patentable ideas as they fit into your business plan is critical to timing a patentability search. Knowing whether the idea is patentable and when you plan to file is essential to maximizing the profitability of your research and development and adding value to your patent portfolio without wasting expenses on ultimately unpatentable subject matter.
Invalidity Searches for Patent Owners and Accused Infringers
An invalidity search seeks to invalidate one or more specific claims of an issued patent. This is accomplished by identifying one or more pieces of prior art that read on the claims, and was not considered by the examiner during prosecution. U.S., foreign, and NPL databases are exhaustively searched. Even patent owners should order an invalidity search prior to enforcing a patent to ascertain any weaknesses in the patent and whether amendments would be beneficial prior to an attempted invalidation at the Patent Trial and Appeal Board, when it may be too late for amendments. Moreover, defendants should order an invalidity search to evaluate whether to settle, file an invalidity proceeding at the patent office, or maintain litigation through invalidity phases in district court.
An invalidity search is valuable at many points in litigation. Patent owners should order invalidity searches on patents they intend to enforce prior to enforcement since waiting too long, such as until after an invalidity proceeding at the PTAB, may be too late to amend to correct weaknesses in the patents. Defendants in patent litigation benefit from early invalidity searches due to the insight into whether to settle due to it being a particularly strong patent, file an invalidity proceeding at the patent office, and/or maintain litigation through invalidity phases in district court. Further, recent developments in district court indicate that waiting too long to file an invalidity proceeding at the PTAB could result in not getting a district court stay of litigation, so early identification of invalidating prior art is essential. Thus, early invalidity searches are critical to litigation strategy for both patent owners and defendants.
As explained above, careful analysis of which search is most appropriate and when to order the search could significantly increase the profitability of searching. This article explains a few considerations important to deciding when to search and which search to order, but every organization has specific business needs.