Published 17/01/2018 by CIONCA Team
A Fork in the Road: Production or Protection?
Start-ups, small businesses, and individual inventors—typically faced with budgetary concerns—often encounter the dilemma of where to allocate their limited funds. Frequently, entrepreneurs, especially when launching a startup business, need to decide whether to invest in their intellectual property (IP) rights, such as patents and trademarks, or rather in the development of their product or service. This predicament introduces risks that should be carefully considered. The investment in IP may delay the development and the launch of the product and the company itself, but the IP investment is in most cases a must. On the other hand, it is understandable that it is tempting for a startup company to invest in its own launch and growth to quicken its establishment and market presence rather than spend on IP. Serious risks are associated with each option, thus, the decision where to allocate that limited budget have to be carefully considered.
For instance, on an episode of Shark Tank show, we see the outcome of an inventor and entrepreneur decision. She invented a new product (a washable/reusable diaper) that turned out to be a market success. She presented a creative, engaging, and effective pitch to the Sharks. Very interested, the Sharks began to question her business strategies and the status of her success. Unfortunately, in the end the Sharks had to restrain themselves from investing when she revealed her weak IP protection. Although she did decide to invest in both IP protection and production, her IP protection hadn’t been well-balanced, apparently due to the same classical cause, the limited budget at startup. While she did have a patent, it apparently did not provide sufficient patent protection against her competition, likely due to narrow scope of the patent claims. As a result, her weak patent protection was no match for her competition, and her many competitors claimed significant profit that could have been hers had she been able to deter them in the first place. After years of being on the market with her innovative product, the market grew to about 70 million dollars in sales, but she had only a market share of about 3.5 million, due to the fierce competition with many sellers (including a former distributor) who apparently stole her idea and entered the market. Not only that she had a very small share of the market (5%), but the profit margins were low too, due to the difficult competitive climate.
This is a lesson to be learned by all entrepreneurs: A single facet of protection or a single IP tool may not suffice. When an IP attorney suggests for example a continuation application for patent to pursue a second patent with broader patent claims, that have to be carefully evaluated. A family of two or more patents is more likely to better protect the new product or technology. Similarly, securing other IP assets such as by filing trademark application(s), or employing other protective strategies (e.g., trade secrets), must be considered. The goal is to increase the business’ scope of IP protection, dissuading the competition from impeding on its success. Having multiple standpoints of IP protection could provide a more holistic armor for the business.
Of course, the converse situation rings just as true—budget cannot always support both business execution and proper IP protection, and sometimes the product will fail, so the funds spent on IP will be a loss too. However, decisions like these must be made very carefully. The entrepreneur should at all times be mindful of the advantages and disadvantages of investing in IP, and the risks involved on each side.
Marin11/18/2015 6:11:11 PM
PTAB Decisions Give Examples of Patent Eligible Subject Matter
Marin11/18/2015 6:15:40 PM
Covered Business Method Claims Are Not Required to Particularly Target Financial Industry
Marin11/18/2015 7:31:35 PM
When Is a Thesis Prior Art?
Marin11/19/2015 2:13:05 PM
An Innovator’s Dilemma: Design or Utility Patent?
Marin1/28/2016 9:10:56 PM
How Unpredictability Can Affect Obviousness Challenges
Marin1/28/2016 9:15:16 PM
The Patent Trial and Appeal Board Designates Two Decisions as Precedential
M. Cionca and I. Kim2/4/2016 5:55:16 PM
Software Inventions Are Still Patentable!
Marin Cionca2/16/2016 6:34:53 PM
In IPRs, patentees have to show that substitute patent claims are patentable
I. Kim PhD2/26/2016 8:47:51 PM
The U.S. Supreme Court Will Review Claim Construction Standards and Institution Decision Reviewability.
Iris Kim, PhD3/25/2016 8:34:14 PM
Challenging a Claim’s Validity with Different Standards of Claim Construction
Marin Cionca5/17/2016 8:57:23 PM
Patent Claims Rejection Based on Inherency
Iris Kim, PhD6/1/2016 7:04:50 PM
The Patent Trial and Appeal Board Designates Five More Decisions as Precedential
Marin Cionca9/6/2016 9:26:12 PM
Patent Case Law: New Example of Software as Patentable Subject Matter
Marin Cionca9/15/2016 9:47:39 PM
Patent Law Alert: Federal Circuit Opens Door for More Software Patents
Marin Cionca2/21/2017 12:30:52 AM
Software Patent Law Update: Federal Circuit Finds Graphical User Interface Patentable
Marin Cionca4/25/2017 9:48:49 PM
Monetization of Patents: How to Make Money with Patents
CIONCA - Staff6/15/2017 5:32:14 PM
Patent Law: Challenging the Patent Claim Definiteness Requirement
CIONCA - Staff6/28/2017 8:26:07 PM
Patent Law: Conditions Precedent May Expose Method Claim to Broad Interpretation During Prosecution
CIONCA - Staff8/9/2017 5:39:58 PM
Patent Case Study: The Novelty Of An “Invention” Is NOT Enough To Make It Patentable
CIONCA Staff8/20/2017 3:16:11 PM
CIONCA on Patents: Think Twice Before Suing for Patent Infringement and Fight Back when Unreasonably Sued
staff9/15/2017 9:33:30 PM
staff9/27/2017 5:00:12 PM
Claim Indefiniteness During Patent Pre-Issuance: Define Your Invention, Not Just Your Audience
staff9/27/2017 5:12:07 PM
CIONCA - Patent and Trademark Law Attorney
Staff9/28/2017 7:27:22 PM
Staff11/3/2017 4:20:04 PM
An Introduction to Provisional Patent Applications
11/10/2017 6:47:44 PM
An Introduction to Design Patent Applications
11/17/2017 1:24:20 PM
An Introduction to Patent Searches
12/1/2017 8:01:27 PM
An Introduction to Patent Cooperation Treaty Applications
12/26/2017 6:04:25 PM
CIONCA Sets Foot in San Francisco
1/2/2018 7:47:09 PM
The Lanham Act: Disparagement Provision Violates the First Amendment
CIONCA Team1/17/2018 8:12:06 PM
A Fork in the Road: Production or Protection?
CIONCA Team2/16/2018 4:07:48 PM
Fashion and Intellectual Property
3/8/2018 1:25:46 PM
Proceed with Caution: Consider Carefully when Narrowing Claims for Allowance
3/20/2018 12:50:05 PM
Andrei Iancu - New Director of the USPTO
CIONCA Staff4/13/2018 9:10:04 PM
It Take Two to Tango: Knowles v. Iancu, a Standing Dispute in a PTAB Decision
CIONCA Staff4/20/2018 5:25:25 PM
USPTO Changes Examination Procedure Pertaining to Subject Matter Eligibility in View of Berkheimer v. HP, Inc.
5/4/2018 7:37:51 PM
The Hague System for Protection of International Designs
CIONCA IP5/17/2018 9:54:58 PM
Marin Cionca Presents at OCIPLA May 2018 Luncheon
7/3/2018 7:44:33 PM
Impax Laboratories Inc. v Lannett Holdings Inc. on Claim Invalidation
Marin Cionca7/31/2018 6:50:05 PM
My patent expired? Can I still sue for patent infringement?
Staff8/16/2018 4:24:01 PM
Correcting or Changing a Patent After Issue Through the Central Reexamination Unit
Staff8/31/2018 7:26:58 PM
Patent Claim Interpretation By Federal Circuit's on Facebook's Contiguous Image Layout
CIONCA Team Member9/17/2018 4:33:20 PM
Trademarks and Likelihood of Confusion: Federal Circuit’s Decision in In re: Detroit Athletic Co.
Marin Cionca10/1/2018 7:42:12 PM
Can I Register a Color as a Trademark or Service Mark?
CIONCA Team Member10/16/2018 6:50:31 PM
A Double-Edged Sword: Benefit of Priority or Longer Patent Term
CIONCA Team Member11/19/2018 1:07:51 PM
The Appeals Process
Marin Cionca12/8/2018 8:35:06 PM
IP Assets - Procurement, Enforcement, Monetization
CIONCA Team Member12/18/2018 6:12:48 PM
Schlafly v. The Saint Louis Brewery: The Registration of Merely a Surname
CIONCA Team Member1/4/2019 4:12:21 PM
In re: Tropp: New Matter in a Continuation Can Be Relevant to Written Description Requirement
Marin Cionca1/23/2019 9:45:30 PM
Patent Law Alert: All Sales of the Invention, Including Secret Sales May Invalidate a Patent
CIONCA Team Member2/5/2019 7:22:27 PM
TiVo Puts Tivoli on Pause: TTAB’s Decision in TiVo Brands LLC v. Tivoli, LLC
CIONCA Team Member2/19/2019 7:12:46 PM
Revised Guidance by USPTO on Patent Subject Matter Eligibility and Examining Computer-Implemented Functional Claims
Marin Cionca3/1/2019 9:36:50 PM
USPTO Director Andrei Iancu Visits Orange County!
CIONCA Team Member3/21/2019 3:49:43 PM
Defining Inherency: A Decision in Personal Web Technologies, LLC v. Apple, Inc.
CIONCA Team Member4/3/2019 7:25:37 PM
The Patent Trial and Appeal Board (PTAB) Designates Three Decisions Precedential
Marin Cionca4/17/2019 3:48:33 PM
What Qualifies as Proper Use in Commerce Claim in a USPTO Trademark Application?
CIONCA Team Member5/7/2019 7:13:41 PM
The Federal Circuit Defines a Technological Invention
CIONCA Team Member5/20/2019 8:25:57 PM
PTAB Designates Cases as Precedential
Marin Cionca6/11/2019 8:43:17 PM
Can I Successfully License My Invention?
CIONCA Team Member6/27/2019 7:41:52 PM
Obviousness in a Single Prior Art Instance: Game and Technology Co., LTD., v. Activision Blizzard INC., Riot Games, INC.
CIONCA Team Member7/5/2019 2:22:42 PM
In re: Global IP Holdings LLC: Broadening Claims Through Reissue Applications
CIONCA Team Member8/5/2019 2:29:33 PM
Is Speculation Enough Evidence for an Appeal?: General Electric Company v. United Technologies Corporation
CIONCA Team Member8/19/2019 7:46:17 PM
In re Yarnell Ice Cream, LLC: Trademark Descriptiveness and Acquired Distinction
CIONCA Team Member9/4/2019 7:20:46 PM
Guangdong Alison Hi-Tech Co. v. International Trade Commission: Objective Boundaries
Marin Cionca9/27/2019 9:32:48 PM
Can an Online Patent Attorney File My Patent?
CIONCA IP10/7/2019 5:44:50 PM
A Decision in Henny Penny Corporation v. Frymaster LLC
CIONCA IP10/16/2019 1:28:13 PM
To Use or Not to Use: The Statutory Period of Trademark Nonuse Prior to Presumed Abandonment
11/15/2019 8:15:11 PM
Liqwd, Inc. v. L’Oreal USA, Inc.: Objective Indicia and Copying
Marin Cionca12/9/2019 8:07:20 PM
A “glove” approach to patent claim construction
CIONCA IP 12/31/2019 4:29:41 PM
The Chamberlain Group, INC. v. One World Technologies, INC.
CIONCA IP 1/9/2020 4:43:58 PM
The Bigger Picture: TTAB’s Decision in In re James Haden, M.D., P.A.
CIONCA IP 1/15/2020 4:47:19 PM
FOX Factory, Inc. v. SRAM, LLC: Presumption of Nexus
Marin Cionca2/9/2020 7:46:10 PM
Analogous Prior Art or Not? A critical patent obviousness question
CIONCA IP3/10/2020 7:45:30 PM
Koninklijke Philips N.V. v. Google LLC, Microsoft Corporation, Microsoft Mobile Inc.
CIONCA IP3/16/2020 8:43:10 PM
GS CleanTech Corporation v. Adkins Energy, LLC: Inequitable Conduct
CIONCA IP4/13/2020 9:33:36 PM
Two of a Kind: TTAB on Shannon DeVivo v. Celeste Ortiz
Marin Cionca4/15/2020 4:41:43 PM
The Day After COVID-19 Pandemic – Hope or Fear?
CIONCA IP 5/19/2020 7:36:30 PM
Uber Technologies, Inc. v. X One, Inc.: “Obvious to Try” Rationale
Marin Cionca, Esq.
Registered Patent Attorney
USPTO Reg. No. 63899
About CIONCA® IP Law firm: We are an Orange County, CA based boutique intellectual property firm with a focus on patent and trademark application, prosecution, opinion, licensing and IP enforcement services, offering its IP services primarily at flat fee rates. We serve local OC clients, as well as clients throughout US and international clients.
We’d love to hear from you…we just need a little info
about your plans to take over the world!
P.S…Feel free to call us! (800)985-9198
Thank you for your message. We will respond within 24-72 hours. Thank you.