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by LAURIE J. MINTZ

Anyone who has been following recent events in the stock market is aware of the growing impact of technology on the global economy. Indeed, the news is filled with reports of the successes (and failures) of high technology companies.

Few Americans have not heard of Bill Gates, and Intel’s Andrew Grove was even named Time magazine’s Man of the Year for 1997.

To succeed in the high stakes world of high tech, a company must vigilantly protect its intellectual property rights from competitors, both domestic and abroad.

This article is intended to familiarize you with some basic measures your clients can take to protect their patentable inventions and reduce the likelihood of subsequent patent litigation both to enforce the patent or to protect against third party claims.

Patent practice

To represent applicants before the United States Patent and Trademark Office (the “PTO”), an attorney must be registered to practice before the PTO. This entails demonstrating a background in engineering or science and passing a comprehensive examination.

However, there are no such restrictions for the attorneys who are responsible for protecting a client’s interest in patented technology, such as patent litigators or intellectual property counsel.

A patent secures for an inventor the exclusive right to prevent others from making, selling, or using his or her invention for an express term of years. (35 U.S.C. §271)

Currently, a utility patent is enforceable beginning on the date the patent issues and ending 20 years from the effective date of filing of the patent application. (35 U.S.C. §154(a)(2))

A typical patent issues at least one-and-a-half to two years, or even more, after filing of the application.

Foreign filing

In most industrially significant foreign countries, an invention must meet a requirement of “absolute novelty” in order to be patentable.

This means that if your client is also interested in obtaining patent protection in a foreign country, the most conservative approach is to file a U.S. application before the invention is publicly disclosed or offered for sale.

The U.S. does not require absolute novelty. The U.S. also allows a one-year grace period for filing patent applications for inventions which have been publicly disclosed, offered for sale, or described in a printed publication by the inventor. (35 U.S.C. §102)

Patent search

A patent search can be an important first step before deciding whether to prepare and file a patent application. A patent search is used to locate U.S. or foreign patents or publications that may be relevant to your client’s invention. Patent attorneys either perform their own searches or contract with firms that specialize in these searches.

An inventor is entitled to a patent for any invention that is novel, useful, and non-obvious. The criteria for determining whether an invention is novel or obvious are set forth in 35 U.S.C. §§102 and 103, respectively.

Therefore, one important purpose of a patent search is to locate any “prior art” references indicating that your client’s invention is not novel, or is obvious.

Years of marketing and development time, not to mention a substantial investment, may be saved by determining whether your client’s invention is actually patentable prior to filing a patent application.

Information that is not originally submitted in a patent application when it is first filed, known as “new matter,” cannot be added after filing, unless your client is willing to accept a later filing date.

However, because an early filing date can be critically important in protecting an invention, it is advisable to include as much information as is necessary in the original application. Information from a patent search will help the patent attorney determine which features of the invention are more likely to obtain protection.

The information necessary to support these features can then be included in the application. Being aware of the prior art from the search also enables the patent attorney to emphasize the differences between the subject of the patent application and the prior art.

A side benefit of the patent search is the potential uncovering of competitor’s patents which may apply to the invention described in the patent application.

If you are concerned that your client’s invention is infringing a competitor’s patent, you may wish to pursue a licensing agreement. A license may prove less costly in the end than defending a patent infringement lawsuit, even if your client prevails.

PTO searches

As part of the patent examination process, the PTO patent examiner will also perform a prior art search. It can be tempting to rely on this search rather than to pay for an independent search.

Be advised that the patent examiners do not always have the time to perform a comprehensive search. The fact that the examiner missed an important prior art reference and allowed your client’s application to issue as a patent is no defense later on when an accused infringer attempts to invalidate the patent based upon prior art that the examiner did not consider.

Duty to disclose

If you or your client know of any information that is material to the patentability of your application, you are obligated to disclose that information to the PTO. (37 C.F.R. §1.56)

The failure to disclose material information is considered to be a violation of the duty of disclosure, and can result in the patent being rendered unenforceable.

It is best to give the patent attorney all of the available information. The patent attorney can then evaluate whether information is material and whether disclosure to the PTO is required.

Know your portfolio

A large company’s intellectual property portfolio can include hundreds, if not thousands of patents. Many of these patents will never be commercially successful.

However, some of these patents are not immediately valuable when first issued, but become commercially viable during their term.

A regular portfolio review will assist your client in keeping track of their patents. You will then be in a better position to quickly determine whether any of their patents are being infringed and to respond accordingly.

Keep informed

It is to your client’s advantage to keep informed of new patents and publications in their field.

Most countries grant a patent to the inventor who is “first to file” an application. The United States, however, grants the patent to the “first to invent.”

This means that, even though your client’s patent issued first, another inventor may be able to invalidate your client’s patent by demonstrating an earlier invention that was not “abandoned, suppressed, or concealed” (35 U.S.C. §102(g)), and then obtain his or her own patent.

Early discovery of a potential infringement can significantly reduce your client’s liability.

Get an opinion

To willfully infringe a patent, the potential infringer must have actual knowledge of its existence.

Given actual knowledge of another party’s patent, a potential infringer has an affirmative duty to exercise due care to determine whether or not he is infringing.

Failure to discharge that duty could result in a finding of willful infringement. 35 U.S.C. §284 provides that, upon a finding of “willful or assessed.”

Among the factors used by the court in determining whether treble damages are warranted is whether a competent opinion of counsel as to validity and infringement has been obtained. (See Great Northern Corp. v. Davis Core & Pad Co. Inc., 782 F.2d 159 (Fed. Cir. 1986).) It is therefore recommended to obtain a written opinion of counsel on the issues of validity and infringement as soon as a potentially infringed patent is discovered.

Preferably, the opinion should be that of an outside patent counsel, but the issue is one of competence to render the opinion so that competent in-house counsel may also provide such an opinion. (See, for example, Read Corp. v. Portec, 970 F.2d 816 (Fed. Cir. 1992).)

Of course, an opinion is of little value unless it is actually followed.

While most corporate counsel and business attorneys are not patent attorneys, they can still play an important role in protecting their clients’ patent interests.

By advising your clients to thoroughly research their inventions, by keeping informed of a client’s patent portfolio, and by immediately taking action when a potential infringement is identified, counsel can protect a client’s patent rights.

Laurie J. Mintz, a registered patent attorney with the firm of Dergosits & Noah LLP in San Francisco, is a member of the executive committee of the Intellectual Property Section of the State Bar of California.