Wednesday, December 4, 2013

What Does a Patent Cost?

Predicting patent costs is like predicting the outcome of a negotiation -- there are a lot of unknowns.  What will the negotiating process (USPTO procedures) be?  What will the final agreement (claims) look like?  In the end will this be a deal worth doing (a patent worth having)?  And the biggest unknown of all is: will you even reach an agreement (get a patent)? 
But accountants, shareholders, clients, bosses, and spouses do not care about unknowns.  
So let’s get to a number:  $20,000.
Using low to middle range representation, textile and apparel companies probably spend $20,000 to get a U.S. utility patent to protect a reasonably simple innovation.  They might have spent less. They could easily have spent a lot more. 
This number is built from four components:  the fees paid by patent holders to the US Patent and Trademark Office, estimated representation fees required to prosecute the patent through the USPTO, search and drawing costs, and a fee increase adjustment.  It does not include maintenance fees over the life of the patent.
I began with 30 patents that were issued in the period between August 20th and November 26th, 2013.  These patents were selected as a random sample of all patents issued in textile related classification codes.  The USPTO fees paid for these patents were pulled from public records.  For our purposes, the fees were adjusted to remove the impact of small entity discounts.  In addition, the fees were analyzed to determine the USPTO procedures required to get a patent issued.
In addition to normal procedures, 30% of the patents required continued examinations, 7% of the patents required an appeal, and 20% of the patents faced restrictions that effectively required the invention to be split into two applications.  

Representation fees were estimated from a sample of 10 firms that were found on the internet.  Using the information available on these websites, representation fees were determined for each firm to perform the USPTO processes required by the sample patents.  The median fee was selected for these processes.

A quick review of companies that do patent searches and patent drawings revealed that if the patent really is simple and straight forward, you can get a search and 3-5 drawings for $2000.  This is the number that was used.

Finally, I added $480 to reflect USPTO application fee increases from 2011, the year when many of the applications were filed.

When you add this all up, these patents incurred estimated expenses of $11,830 in representation fees, $6,405 in USPTO fees, and $2,000 in drawing and search fees for a total estimated cost of $20,235. 

Below is a summary of selected patents that have been recently issued in textile related classification codes:
Garment Protective System:  A jacket/body armor system that allows the armor placement to be adjusted to meet the needs of the individual wearing the garment.  Patent #:  8522369.  Inventor:  Bay.  Assignee:  Sullivans, Inc.
Yarn and a Process for Manufacture Thereof:  A process to align and electrospin nanofibers into yarn.  The advantages over prior nanofiber methods are an increase in yarn strength and that a water bath is not required.  Patent#:  8522520.  Inventors:  Smit and Sanderson.  Assignee:  Stellenbosch University.
Sharp Three-Dimensional Embroidery and Method for Manufacturing the Same:  An embroidery process that allows for detailed three dimensional designs.  The claims are only for the embroidery and not the equipment.  Patent #:  8522702. Inventor:  Cho.  Assignee:  Yupoong, Inc.
Multi-Needle Embroidery Sewing Machine:  A multi-needle sewing machine that allows execution of a punch engraving operation on the surface of a punch work piece in addition to execution of a normal embroidery sewing operation.  Patent #: 8522703.  Inventor: Kawaguchi, et. al.  Assignee:  Brother Kogyo Kabushiki Kaisha.
Stitched Perforated Sheet Materials:  A method for designing and stitching perforated upholstery materials (leather, cloth, plastic) without distorting the stitching or the perforations.  Patent #:  8522704.  Inventor:  Graham.  Assignee:  Bentley Motors Ltd.
Gloves for Touch Screen Use:  A cold/foul weather glove incorporating conductive yarns in the fingertips.  This conductivity allows a user to effectively use the touch screens on a phone or tablet without having to remove the gloves.  Patent #: 8528117.  Inventors:  Asiaghi.  Assignee:  The Echo Design Group, Inc.
Impact Energy Management Method and System:  A material made of thermoplastic consisting of a series of cells that are designed to diffuse and diminish the force of an impact.  For example, one implementation decreases the force of the impact by increasing the time the energy takes to transfer through the material.  Patent #: 8528119.  Inventor: Ferrara.  Assignee: Xenith LLC.
Systems and Methods of Twisting and Heat-Setting Yarn, and Apparatus for Twisting Yarn and Heat-Setting Yarn:  An integrated machine that twists, reduces the tension of the twisted yarn, accumulates the yarn to allow the machine to continue to operate for a period of time during interruption, and heat-set the yarn in a single process.  Speeds are between 10,000 and 100,000 rpm.  Patent #:  8528310.  Inventor:  Ganahl and Rittenhouse.  Assignee:  DuPont North America S. ár.l
Method and System for Freehand and Real Time Quilting with a Computer Controlled Quilting Machine.  A sewing machine, computer and graphics tablet that allows a user to draw, in freehand, a design which is converted by the computer into a pattern file.  The computer then controls the sewing machine to execute the pattern.  This is done in real time, with the quilting pattern being sewn while the drawing is being made.  Patent #:  8528491.  Inventor:  Bentley.  No Assignee.

Jim Carson is a principal of RB Consulting, Inc. and a registered patent agent.  He has over 30 years of experience across multiple industries including the biotechnology, textile, computer, telecommunications, and energy sectors.  RB Consulting, Inc. specializes in providing regulatory, management and prototyping services to small and start-up businesses.  He can be reached via email at or by phone at (803) 792-2183.

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