There are many misconceptions or ‘myths’ about patents that have found their way into popular discourse, ranging from what type of innovations are patentable, to how important it is to own and protect your intellectual property (IP) using patents. These myths include “You can’t patent software”, “I have a patent on my product so I am allowed to sell my product” and “You should only get patents if you are willing (and can afford) to take someone to court if they infringe them”. Unfortunately, many businesses fail to secure patent rights on valuable intellectual property or fail to identify, recognize and mitigate patent-related risks in part because they are relying on these myths. This may lead to missed opportunities or worse, result in increased liability arising from patent infringement disputes.
The in-house counsel, as a trusted advisor, is uniquely positioned to provide their company’s business and technology leaders with proper and accurate guidance, retaining outside counsel when needed, to help drive fact-based decision making when it comes to patent protection and patent infringement risk management and avoid potentially costly mistakes.
In this article, we will address five common myths about patents to globally help business leaders and technology managers better separate fact from fiction and make informed decisions to protect investments made in innovation.
1. Patent Myth #1: If I obtain a patent for my invention, I can automatically commercialize products and/or services incorporating my invention without worrying about patents owned by others.
2. Patent Myth #2: You need to have a working prototype before filing for patent protection.
3. Patent Myth #3: A patent is only worth the investment if you are willing, and have an allocated budget, to sue those that infringe your patents.
4. Patent Myth #4: “Software" is not patentable.
5. Patent Myth #5: Some technology sectors evolve so quickly that by the time you would get a patent on your innovation, it will be obsolete.
The Myths vs The Facts
Myth #1: If I obtain a patent for my invention, I can automatically commercialize products and/or services incorporating my invention without worrying about patents owned by others.
The Facts: A patent only allows the owner to prevent others from using the patented invention without consent but does not allow the patent owner to make use of the invention in relation to earlier patents owned by others.
Obtaining a patent does not mean that products or services incorporating the invention are not restricted by earlier patents owned by others. A patent only allows you to prevent others from performing what the specific claims of your patent cover. To assess whether your company’s commercial activities fall within the scope of patents owned by others, and thus whether it is free to make, use and/or sell its products or services, it is important to search earlier patents to get a sense of what patents are currently in force that may be relevant to planned commercial activities.
For example, a new patent for an in-line skate with a brake, assuming that the novelty of the invention lies in the presence of the brake in the in-line skate, would entitle its owner to stop others from making in-line skates with brakes. Nevertheless, if someone else holds a valid earlier patent on a basic in-line skate, the owner of the new patent for an in-line skate with a brake would not be entitled to make and sell a skate with a brake without first obtaining a license to that earlier patent. In other words: the objective of a patent is only to allow you to prevent others from using your invention, as defined by the specific claims in your patent, without your consent; it does not allow you to use your invention in relation to patents owned by others without their consent.
What this means is that, even if you have one or more patents that cover aspects of your commercial product, it is still important to perform a patent search to get an understanding of what patents owned by others could present an infringement risk. Ideally, this search would be performed early on, for example during the development phase of your product, to identify potential risks before significant investments are made. In some situations, this may also mean proactively managing these risks, which can be achieved through a variety of means – for example by designing around the relevant patents owned by others, seeking a license to use certain patents, and possibly obtaining a legal non-infringement opinion. This type of exercise, which may be performed in several steps and at different moments, is sometimes referred to as a “Freedom-to-Operate (FTO)” or a “Market Clearance” assessment.
Understanding the relevance of a patent requires interpreting the language of its claims, which requires knowledge not only of the technology to which the patent pertains but also in-depth knowledge of local patent laws and legal precedents. The in-house counsel is well positioned to help their client recognize when qualified outside-counsel, such as a qualified patent agent or patent lawyer, should be retained to provide guidance during this process.
Myth #2: You need to have a working prototype before filing for patent protection.
The Facts: There is no legal requirement that there be a working prototype of your innovation before filing for patent protection. However, in “first-to-file” patent systems, whoever files an application on an innovation first wins in the race to obtain the patent on that innovation. Time is often of the essence!
To pursue patent protection, you only need to have described your invention in sufficient detail to allow someone skilled in the field of your technology (a.k.a. ‘a person skilled in the art’) to be able to practice it. This means that, so long as an appropriate description of the invention can be prepared, an application for a patent can be filed well in advance of building an actual prototype.
Also, in essentially all countries that have local laws regulating the granting or enforcement of patents, patents are granted to the first person to file an application on an innovation, not the first person to invent. For that reason, getting a patent application filed early is often critical in highly innovative fields, particularly where multiple players are actively working to find technical solutions to the same problem.
In competitive fields where technology is key and the level of patenting activity is high, delaying the filing of an application can have costly consequences. By waiting, not only is there a risk of failing to secure broad patent protection, but you may also actually be prevented from commercializing your innovation should others in the field file patent applications on similar technology before your application is filed or the innovation is disclosed.
For this reason, it is important for the in-house counsel to be aware of the level of patent activity and culture of patent protection of the industries and markets their business clients are operating in and help them plan accordingly so they are able to compete commercially while limiting exposure to patent-related risks.
Myth #3: A patent is only worth the investment if you are willing, and have an allocated budget, to sue those that infringe your patents.
The Facts: Patents are a strategic asset with commercial value that a business can use as leverage when engaging with investors, employees, contractors, suppliers and other business partners.
While litigation can in some cases play a strategic role in supporting business objectives, patents and other IP rights have commercial value and many potential uses beyond enforcement through litigation. Such uses include attracting capital for growth from investors, providing collateral for securing debt financing, enhancing a company’s balance sheet and valuation, establishing trust and confidence from buyers and consumers, facilitating collaborations with partners and/or providing a foundation for licensing, co-existence and/or cross-licensing agreements, amongst other examples.
One important goal and benefit of securing patent protection is to help more clearly establish boundaries of ownership of intellectual property for technology owned by the business relative to that owned by other stakeholders, including employees, contractors, business partners and suppliers. Thus, not only does filing for patent protection help secure value associated with the technology in favour of the patent owner but doing so, in combination with agreements and contracts comprising suitable IP provisions, often reduces the likelihood of ownership disputes later on when the technology has matured and has acquired some level of commercial success.
In addition, having a solid patent portfolio in a commercial space can act as a deterrent to others seeking to enforce their own patents in that same commercial space and thus may reduce the risk of your business clients being dragged into a costly litigation at a future point in time. While securing patent protection does involve some expenses, these are minimal when compared to the cost of a legal dispute.
Myth #4: “Software" is not patentable.
The Facts: While actual software code per se is protectable by copyright and not by patents, software-implemented functionality can be protected by a patent, provided it is new, non-obvious, useful and otherwise compliant with the other legal requirements.
For more than 30 years, there has been debate on the question of whether software is patentable, and the conclusion is clear: software innovations are patentable. While some points of debate surrounding software and patents remain, these tend to relate less to the broader question of “is software patentable?” and instead focus on more specific issues such as “what is needed for a software-implemented invention to be considered patentable?”
Computer software plays a key role in many valuable innovations. Therefore, understanding what can be considered eligible for patenting, and what cannot is key. While actual software code per se is protectable by copyright and not by patents, software-implemented functionality can be protected by a patent, provided it is new, non-obvious, useful and otherwise complies with the other legal requirements. Examples of software-implemented solutions that may be suitable candidates for patent protection include: processes used to address a specific problem, some functionality provided through a Graphical User Interface (including e-commerce applications), AI-based solutions to practical problems, control systems and other computer-implemented solutions. Conversely, simple mathematical formulas and algorithms that are not applied to address a practical problem cannot be patented.
Myth #5: Some technology sectors evolve so quickly that by the time you would get a patent on your innovation, it will be obsolete.
The Facts: Choosing the right innovative features to protect, focusing on business/user benefits, which have longer staying power than very specific technical solutions, and including in the patent document descriptions of alternative realizations and reasonable predictions as to how the technology may vary/evolve, are key to “future-proofing” your patent portfolio.
While, in some sectors, technology evolves quickly and new product releases happen every few months, the underlying problem and the novel solution provided by the technology often remain relatively constant across multiple releases.
Important questions you need to ask business and technology clients contemplating patent protection include: (1) What is the problem the technology is addressing, (2) What will the technology look like in the future in order to continue solving the problem, and (3) How can the innovation be articulated in broad “problem/solution” terms? The answers to these questions will help guide your client to choose what to seek patent protection for and help prepare and seek a patent more likely to remain relevant through the various embodiments of the invention in the future.
Choosing the right innovative features to protect, focusing on business/user benefits, which have longer staying power than very specific technical solutions, and including in the patent document descriptions of alternative realizations and reasonable predictions as to how the technology may vary/evolve, are key to “future-proofing” a patent portfolio. For example, in the case of software, while a given software release may only include a limited number of features due to programming time and resource constraints, the design team has typically already thought about additional features that will be included in future releases. Since, as mentioned above, a working prototype is not needed to file a patent application, features of both a current software release, as well as potential future releases (including features that have only made it as far as the drawing board), can be included in the same patent application provided an appropriate description can be prepared.
While working with a qualified patent agent is advisable in all cases when drafting a patent application, for innovations in quickly evolving sectors, working with a patent professional who understands your clients’ technology and is capable of working with you and your client to extrapolate to account for future variations can play an especially important role in extending a patent’s useful life.
Conclusion: Having a clear understanding of patent facts is key
The in-house counsel is well positioned to ensure their company’s business and technology leaders are aware of the facts related to patent protection and patent infringement risk management to make informed commercial decisions. While this applies to a broad range of sectors, this is particularly critical in innovative sectors in which important investments are being made to develop new products and services. Relying on patent myths can result in missed opportunities and, on occasion, increased liability when patent-related risks are not suitably managed.
Authors: Brigide Mattar, Professional Engineer, Patent Agent, and Partner, Smart & Biggar IP Agency Co. She may be contacted at bmattar@smartbiggar.ca, and Julia Schur, Attorney (Massachusetts), Smart & Biggar LLP. She may be contacted at jschur@smartbiggar.ca.
Check Out Additional ACC Resources:
- Top Ten Patent and Regulatory Things You Need to Know When Bringing a Biopharma Product to Canada, by Nancy Pei, Partner, Alice Tseng, Partner, Toronto Office and Daphne Lainson, Partner, Chair of Firm, Ottawa Office, Smart & Biggar LLP (2020).
- 10 Things You Need to Know About Life Sciences Patent Litigation in Canada, by Sheldon Hamilton, Partner, & Nancy Pei, Partner, Smart & Biggar LLP (2020).
