Patent Reality: Basement Prices Mean Basement Quality

Many corporations do exactly the wrong thing during a recession, namely downsize, spend less on research and development and essentially shoot themselves in the foot.  But myopic corporations are not the only ones who engage in activities that are contrary to their own interest.  Independent inventors and small businesses are struggling and for every encouraging economic sign there are many others that show a stalled recovery; a recovery that was already going to slow to start with.  There is nothing wrong with being cost conscious, but there is a difference between being cost conscious and being cheap.

As is the case with all recessions or economic downturns, more and more people are turning to inventing.  Just over the last several months, since at least late winter 2012, I’ve seen an uptick in the number of inquiries from inventors of various levels of experience who are interested in doing their own thing, starting a company or expanding the small business they already have to incorporate some new invention.   This is not at all surprising, and is in fact exactly what you would expect.  For many of these individuals and businesses, however, cost is the primary driving concern.  They want to succeed, but they need to keep costs down.  That is understandable and commendable, but when cost consciousness grows to the point where it interferes with proper execution of the plan then one has to at least ask whether it makes sense to pursue the plan.

When finances are difficult people look to themselves for assistance, and to figure out how they can make a better tomorrow without relying on anyone else.  But if you do not have enough resources to pursue a plan in a manner that is likely to succeed all that you have done is waste time and money.  Yes, the dirty little secret is that being cost conscious and seemingly financially responsible can lead exactly to the point where you didn’t want to be. The truth is that if you cut too many corners in the invention to patent to commercialization cycle your odds of succeeding go down dramatically.  Being cheap is not synonymous with being fiscally responsible.

The Internet has caused low cost providers in the patent service space, who are sometimes not even patent attorneys or patent agents, to offer ever lower prices.  For example, I spoke with an inventor the other day who paid $1,200 for the preparation of a non-provisional patent application.  The application is extremely short, has little information about the invention, no information about the nuances of the invention, no discussion of alternative versions of the invention and doesn’t have information relating to what the inventor says is actually the invention.  I wish I could say this is a unique conversation, but it is not.  For many new inventors the first time they realize there is a problem is when a Patent Examiner starts the prosecution process.  Unfortunately, by then it is almost always too late to do anything about a defective patent application.  Worse yet, there are frequently (if not nearly always) events that have transpired post filing of the defective patent application that will make it legally impossible to ever obtain a patent.

One thing that inventors and small businesses need to do is shop around for pricing, and you have to have an idea what a reputable patent attorney or patent firm would charge for your project.  That quote will likely be much higher than you want to pay, likely higher than seems reasonable.  Then you shop around more and find some bargain basement provider, who may or may not be a patent attorney or patent agent, who offers to do the job for 20 cents on the dollar, or less.  Many times the inventor will jump at this price and praise their good fortune.  What has really just happened is the inventor has selected the lowest bidder to do  the project.  To properly do the project may take 40 hours, so the way it is at all economical for the low bidder to undertake the work is to not only charge 20 cents on the dollar, but to also spend only 20% of the 40 hours necessary to do the job properly.  So that means you get about 8 hours of time, if that.  The truth should be self evident — you cannot competently do a job in 8 hours when the job requires 40 hours.

[Inventors-Books]

The more time you spend drafting a patent application the better, more detailed and stronger the application is.  That reality may not sit well with some, but it is the honest truth.  When most people stop and think about it they know in their heart of hearts that it is correct, yet they allow themselves to be lured in the savings they will receive.  They actually convince themselves that a highly skilled patent attorney who would spend 40 hours on the project will produce nothing more than an inexperienced patent attorney or patent agent who spends a fraction of the time.  Sometimes they will convince themselves that someone who is not even a patent attorney or patent agent will be able to do just as good a job as someone who has been practicing for years.

I know very well what the capabilities are of those with minimal experience.  I have been an attorney for nearly 17 years, and a patent attorney for nearly 14 years.  I have taught various patent drafting courses, patent claim drafting courses and patent prosecution courses at various law schools for at least a decade.  I have also taught a patent bar review course for PLI for over a decade.  I deal with new attorneys and engineers wanting to become patent attorneys or patent agents all the time.  They are eager to learn, but have a long way to go.  Even after an entire semester in a law school class students are unable to draft something that wouldn’t need significant editing by an experienced practitioner.  And yet inventors somehow manage to convince themselves that anyone can do this patent stuff, even someone without any training.  Extraordinarily naive.

If you are skeptical allow me to discuss this reality in terms of the patent search process.  Do you really think that you are going to get the same detailed search and analysis for $250 as you will for $2,500?

Those who are serious inventors and business people know that a $250 patent search is not as good as a $2,500 patent search and opinion.  You simply cannot have highly trained, competent people spending the amount of time necessary to do even an adequate job if you are paying only $250, and serious folks understand that.  Serious inventors also understand that the goal is not to do an “adequate job.”  The goal is to protect innovations and build a business, so serious inventors do not want to and simply will not shop for the lowest price, whether it is for a patent search or a patent application.  Doubt that?  One of the best, most busy patent attorneys I know charge $900 per hour and he has more work than he can almost handle.  He is a computer genius (and I mean that literally) and highly sought after.  Those who need quality and can afford it get the best and pay whatever it takes.  That isn’t a realistic strategy for individuals or small businesses.  Being cost conscious is prudent, but not to the point where it compromises the entire plan.

Sophisticated inventors know that you will not receive the same thing in terms of patent service if you pay $2,000 for an patent application instead of paying $8,000 for a patent application.  From the perspective of a novice or not yet savvy inventor a $2,000 patent application will look identical to the $8,000 patent application.  In a patent application, however, the devil is in the details, and the single most important part of a patent is the claims, which the uninitiated simply cannot read and understand.  Thanks to crazy rules patent claims need to be written in what approximates a foreign language, or perhaps the equivalent of Shakespearean English.  Cheap patents can be obtained because the claims are extremely narrow and provide little, if any, useful rights.  Unless you hit a grand-slam home-run in terms of inventing you will never know if your patent claims are good, bad and/or ugly.  But imagine the horror of hitting said grand-slam home-run in the bottom of the 9th inning to win Game 7 of the World Series, only to miss first base and be called out!  That is unfortunately what happens to those inventors who race to the low cost provider and eventually wind up with a worthwhile, economically viable invention.

There is a reason why low cost solutions are in a free-fall race to zero, or what I typically refer to as a race for the bottom.  If what you are providing to people is low quality you naturally must keep prices low; no one would pay otherwise.  In such a market where there is an endless stream of market entrants who cannot compete on high quality or expertise, they compete on price, which further drives the price down, leaving less margin, less time to provide the services promised and as a result quality continues to suffer.  So before you consider going with a low cost provider thought really should be given to why the market is pushing prices down on the low end.

So the moral of the story is this: inventor beware!  Some of you will pursue inventing as a hobby, and if that is you whatever you do is fine.  My uncle used to hang his issued patents on the wall, and after some disappointments and missed opportunities due to circumstances beyond his control he stopped inventing for profit.  He was extremely gifted mechanically and electrically, his talents made a career for him and his own business, and he was an extremely proud inventor.  If that is you, follow your dreams and do what you want, including getting a patent from the lowest bidder.  If, however, you are trying to invent for profit and to start a business you need to take note of the reality Thomas Edison learned early on.  Invent where there are market and business opportunities, not because what you are creating is cool.  I don’t think Edison actually used the word “cool,” but you get the idea.  You need to see the inventing and patent process as a part of an overall business strategy, and if you do that, and are honest with yourself, you will realize that blindly choosing the low bidder without thought is not a winning strategy calculated to succeed in the overwhelming majority of circumstances.

So now what?  The pages or IPWatchdog.com are filled with information to educate inventors about what needs to be in a patent application and how to do a patent search.  This article is not intended to say that cost should not be a consideration, that in and of itself would be naive.  Rather, you cannot expect cheap services to lead to the same high quality patent as would be obtained from an experienced, quality patent attorney who has the time necessary to do the job properly.  Thus, you need to appropriately move forward with a budget and spend money that is justifiable from a business standpoint.  Conservative spending is fine, but being cheap and fooling yourself into believing you are getting high quality for a bargain basement price is foolish.

For some tips and suggestions on how to move forward responsibly yet economically please see:

1. The Business Responsible Approach to Inventing
2. Top 5 Mistakes Inventors Make
3. Starting the Patent Process on a Limited Budget
4. Inventor Pitfalls: Causing Irretrievable Patent Damage

Even if you never draft your own patent application it will still be useful to understand as much as possible about the process.  That will make you a better inventor and put you in a position to more meaningfully work with the patent attorney or agent you hire to represent you.  For information about what needs to go into a patent application please see:

1. Tricks & Tips for Describing An Invention in a Patent Application
2. Defining the Full Glory of Your Invention in a Patent Application
3. Patent Drafting: Describing What is Unique Without Puffing
4. The Key to Drafting an Excellent Patent – Alternatives
5. Patent Drafting: Language Difficulties, Open Mouth Insert Foot
6. Patent Illustrations and Invention Drawings, What do you Need?
7. An Introduction to Patent Claims
8. Drafting Patent Applications: Writing Patent Claims
9. Drafting Patent Applications: Writing Method Claims
10. Patent Claim Drafting for Inventors

If your invention deals with software, business methods or computer related technologies please see:

1. Writing Software Patent Applications
2. Defining Computer Related Inventions
3. The Information Needed to Avoid Writing Bad Software Patents
4. Software Patents and Murphy’s Law: Uncertainty is Where Patentability Resides
5. Patenting Business Methods and Software in the U.S. 
6. Patent Drafting: Defining Computer Implemented Processes 
7. Business Methods: Concrete & Tangible Description a Must