Thursday, November 13, 2014

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 the number:  $20,000.

Using middle range representation, textile and apparel companies probably spend $20,000 to get a U.S. utility patent to protect a 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 223 patents that were issued in the period between August 20th, 2013 and October 7th, 2014.  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, 40% of the patents required continued examinations, 5% of the patents required an appeal, and 25% 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 $1,300.  This is the number that was used.

Finally, I added $620 to reflect USPTO application fee increases from 2011, the year when many of the applications were filed.

When you add this all up, patents incurred estimated expenses of $12,500 in representation fees, $5,640 in USPTO fees, and $1,300 in drawing and search fees for a total estimated cost of $19,440. 

Below is a summary of selected patents that have been recently issued in textile related classification codes:

Modified binders for making fiberglass products:  Binder compositions for making fiberglass products. The binder compositions include a phenol-aldehyde resin or a mixture of Maillard reactants and one or more modifiers selected from a group consisting of one or more vinyl aromatic derived (copolymer) units and at least one of maleic anhydride and maleic acid; an adduct of styrene, at least one of maleic anhydride and maleic acid, and at least one of an acrylic acid and an acrylate; and one or more latexes.  Patent:  8703628.  Inventor:  Tutin,  Assignee:  Georgia-Pacific Chemcicals LLC

Fire barrier fabric for use with articles:  A multilayer fire barrier fabric further where the fire barrier layer provides flame-retardant and/or flame-resistant properties to the entire fabric without requiring fabric coatings or treatments to provide additional contributions to flame resistance.  The fabric can be used for upholstered articles and mattresses.  Patent:  8703631.  Inventor:  Sytz.  Assignee:  Murtzco, Llc

Moisture management support garment with a denier differential mechanism:  A moisture management fabric using a denier differential to facilitate the movement of sweat away from the wearer's body. The denier differential relies upon a facing layer and a back layer with substantially different yarn thickness and fabric porosity to achieve fluid transport.  Patent 8702469.  Inventors:  Hurd and Sokolowski.  Assignee:  Nike Inc.

Pre-encased underwire assembly:  An improved encasement for underwires for use in brassieres that allows for more efficient sewing, better durability, and improved wearer comfort.  Patent:  8702470.  Inventor:  Boser.  Assignee:  Apparel Machinery Services, Inc.

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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