Provisional Patents: A (Temporary) First Step
Any entrepreneur is likely to be euphoric when her company discovers a novel and potentially valuable genomic invention that may be protectable by a patent. But when the celebrations start to fade, difficult decisions will remain about how to protect and exploit the intellectual property rights associated with the invention. A company may protect its rights by carefully avoiding disclosure until it has reduced its invention to practice (that is, made it work) and filed a patent application. But our entrepreneur may not have that option. Reducing the invention to practice requires money, which may be in short supply.
For the purpose of this post, we assume that the entrepreneur has already taken the required steps to be sure the company owns all necessary rights in the invention. (See our earlier Bench to Market articles: “What Happens When Professors Have Valuable Inventions?” and “Don’t Overlook Agreements with the Inventors.”) How can she now have the discussions with outside parties (such as venture capital firms) that may be necessary to commercialize the invention, without risking the loss of important intellectual property rights?
The most obvious answer is to use a well-written confidentiality agreement that restricts the right of the other party to use or disclose any proprietary information relating to the invention. While this approach has the advantage of being very low cost, there are limits to its use. Many potential investors will be in the business of evaluating multiple opportunities and they will simply refuse to sign any confidentiality agreement that might limit those activities. A negotiated confidentiality agreement that the other party will agree to sign may have loopholes that permit some kinds of disclosure. Even with a well written agreement, it can be difficult to prove that the other party acquired the suspect information from the entrepreneur as opposed to some other legitimate source. Our entrepreneur could be understandably nervous about relying solely on a confidentiality agreement for protection.
What are the other options? Most entrepreneurs know that patents offer potentially powerful protection of an invention, but obtaining a patent can be too expensive to be practical at an early stage of product development. A provisional patent application may be the answer, at a much lower cost.
A provisional patent application is a “placeholder” that allows the entrepreneur to start the process of seeking a patent, without a major expenditure, and to establish a filing date that can help protect against theft of the invention. Filing a provisional patent application also permits the entrepreneur to use the term “Patent Pending” with respect to the invention, which may be useful in dealing with other parties.
The application process is not complicated, requiring only an informal document that can be prepared without the help of an attorney. The entrepreneur need not identify exactly what aspects of the invention are claimed to be patentable nor specify the types of formal “claims” that are at the heart of a full patent application. Some other formal requirements of a full patent application, such as an oath or declaration, also can be omitted. To file a provisional patent application, the entrepreneur must simply prepare a basic written description of the invention and how it will be used. If the invention is a product, the description must include the manner and process of making it. The description can be in normal non-legal language, but it must be full, clear, concise, and exact. The test for adequacy is whether a person skilled in the field of the invention could make and use the invention after reading the description. If there are multiple ways in which the invention could be used, the provisional patent application must set forth what the inventor thinks is the “best mode” of use. A drawing must be included if it is reasonably necessary for a person to understand the invention.
Applications can be filed with the Patent and Trademark Office on-line or in written form. The PTO website includes links to all of the required forms and instructions.
There are limits on the use of provisional patent applications. A provisional patent application is temporary in nature. It is not examined by the PTO on its merits and lapses twelve months from its filing date. To obtain a patent, the entrepreneur must follow up by filing a non-provisional patent application (a much more expensive full application using a licensed patent attorney) within the twelve-month window. An entrepreneur who misses that deadline can no longer use the “Patent Pending” designation and loses the right to use the earlier priority date of the provisional patent application. More significantly, the entrepreneur could lose the right to seek a patent on the invention altogether if she has publicly attempted to commercialize the invention during the twelve-month period. In that case, the invention might be considered to have been “in use” or “on sale” for more than twelve months at the time the provisional application lapses, thus barring the grant of a patent.
Finally, even though no attorney is required for the provisional patent process, there may be times when the entrepreneur decides that using an attorney, at least in a limited way, makes sense. While the description of the invention in the provisional application may be informal, it needs to be broad enough to adequately support the claims in any later-filed non-provisional application. This is a potentially daunting task for a non-lawyer since the scope of some biotechnology method patents (medical diagnostic techniques, for example) is uncertain pending the Supreme Court’s decision in In re Bilski. Whether the cost of an attorney can be justified may depend on whether the entrepreneur’s primary goal is merely to protect the invention while assessing its value or to maximize the potential scope of any patent that is ultimately granted.
