Written by Carel Smit, a former patent attorney and entrepreneur, now author and speaker dedicated to IP awareness and education. More of his writing can be found at carelsmit.com.
Read part two of Carel's blog.
Back to figuring out how we could safely share our idea.
We knew they were good guys with a good reputation, but upon hearing the idea there would be absolutely nothing stopping them from running off with it and making their own version. They were the technical experts and we were just the people with an idea, so I briefly gave my physio friend a run-down of the options available to us. Paranoia is a bigger killer of good ideas than the actual possibility of idea theft, and my advice was that we needed to keep paranoia at bay, but make sure the basics were covered. Basically, we had to protect as many aspects of the idea as possible, but this would be difficult given that we didn’t have enough technical expertise to know how or whether such a machine could work. We could use patents to protect the technical aspects of the product, design registrations to protect the shape of the eventual device and treatment unit, trade marks for the logo and product name, as well copyright for certain of the remaining features such as the product manual, product drawings, website, and the like.
But first we had to speak to these guys without losing the rights to the invention. Spoiler alert: we did this using a confidentiality agreement, which they were happy to sign once they realised that we were serious about building something new and unique and would need their help.
During our first meeting they came up with some good ideas, which meant that they were probably going to be co-inventors (more on this later). This means that we had to either get them into our company or to have them sign over their rights to their part of the invention to us (called an “assignment of rights”). We got along with them really well and we all thought that it we would contribute skills and expertise to get this thing going. We ended up starting a company into which we all dumped our IP and became shareholders – in essence, all of us signed a document stating that all of our ideas relating to this product, including the rights to apply for patents, would be made over to, and held by, the new company.
Once we were all on the same page, we compiled a technical product specification that would form the basis for the device and also for the ensuing patent application.
But first we had to get an idea of the landscape we were playing in, so we did a rather extensive patent search ourselves using all the free databases available. This was the primary risk mitigating step we took – find out what’s out there before we waste money on patents. Even more importantly, it showed us whether we would perhaps be infringing on any pre-existing patents that could end up with us being sued for patent infringement.
[Sidebar: If I had the opportunity to do all of this over again, I would file the initial application and then request IP Australia to conduct a so-called International Type Search, which is basically a very early stage search that they conduct on provisional patent applications. They usually send you a report within 4 to 6 weeks and it outlines exactly which aspects of your idea are patentable, and which aren’t. It also shows you what other players in this field are up to and how their patents and publications impact on your invention].
Back to our strategy: we decided that we wanted to file a patent, because it would be quite easy for a competitor to reverse engineer our product. Also, we wanted some leverage in case any competitors came knocking. We were small and some of our competitors were massive – one of them was one of eight keystone sponsors of the Monaco F1 Grand Prix, so we had our work cut out for us.
Finally – we also wanted to perhaps get some investors involved and we realised that we would look a lot sexier if we had a de facto monopoly for them to invest their money in.
The fourth and final part will be posted next week.
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