But if a startup has not yet filed at least a provisional patent application, what can be the ramifications of such a video? I have asked Mark Beloborodov, an experienced U.S. patent attorney, to explain the risks of early disclosure.America Invests Act. According to the expanded definition of “prior art” pursuant to the Leahy–Smith America Invents Act (AIA) that went into effect on March 16, 2013, public use, sales, publications, and other disclosures available to the public anywhere in the world as of the filing date bar patentability. Public disclosure of the invention by the inventor (or someone else who “obtained” the disclosed subject matter from the inventor) within one year prior to filing (inventor's "publication-conditioned grace period") constitutes an exception. This exception is a concession to opponents of the AIA’s “first-to-file” regime that already exists in the European Union and the rest of the world, and a carryover from pre-AIA patent law, which has traditionally given startups comfort to discuss their invention publicly before filing a U.S. patent application, in connection, for instance, with fundraising efforts.
Product for Sale. One potential problem that a promo video featuring the product may pose is that it may not fall within the “publication by inventor” exception, but may instead be considered an offer of sale of the product featured. Any novel and non-obvious features, functionalities and attributes implemented in the product that, prior to the video’s release, constituted patentable inventions, may suddenly fall into the public domain and thereby substantially reduce the value of the business. Publication. But suppose that the promo video (or an article) does not reach the level of the offer for sale and qualifies for the publication-conditioned grace period. Does that mean that it is safe in those circumstances to disclose inventions, for which a patent application has not been filed?
It’s not so simple, says Mark. While the disclosed inventions themselves may still be protected, what if a public discussion is spurred by the disclosure that builds on the information made public by the inventors? Anything that is generated in that public discussion above and beyond what the inventors disclosed falls into the public domain. If the initial publication disclosed only part of the invention, and then other elements of the invention surfaced in subsequent public disclosures, even such other elements previously known to the inventors, patent protection for those elements may not be sought later. So any disclosure prior to at least a provisional patent application is fraught with risk even in the US, not to mention loss of patent protection for the invention as a whole in other countries.
The Band-Aid Solution. So what’s one to do? In the perfect world, a startup’s patent application would be prepared by a patent attorney in advance of starting to pitch investors and certainly well in advance of publicly distributing promotional materials. Such application, even if a provisional one, would be drafted after careful consideration of the invention and would contain a detailed and enabling disclosure of how it is made and operates, which fully supports patent claims to be included later in the full-blown application.
But we don’t live in the perfect world. To preserve intellectual property rights in the product or solution that will be the subject of an upcoming promotional video, Mark recommends making at least a minimalist provisional patent application filing before the video becomes public. Even if the filing consists of little more than the video script, overview of key components of the invention, and annotated screen shots illustrating them, risky as it is, it’s better than nothing. After the founder strings together the materials that will go into the promo video, it is advisable to have a patent attorney do a quick review. This might translate in total into a $1,000-$1,500 cost, including the filing fee, but, if it may preserve intellectual property rights that might otherwise be lost forever, seems like a good compromise.
Happy company making!
|Inna Efimchik, a Partner at White Summers Caffee & James LLP, specializes in assisting emerging technology companies in Silicon Valley and beyond, providing incorporation, financing, and licensing services as well as general corporate counseling.|
Copyright Notice. The copyright for all original content in this post and any linked files is owned by Inna Efimchik. All rights are reserved.
No Attorney-Client Relationship. This post has been prepared by Inna Efimchik of White Summers for general informational purposes only. The information provided herein does not constitute advertising, a solicitation or legal advice. Neither the availability, transmission, receipt nor use of any information included herein is intended to create, or constitutes formation of, an attorney-client relationship or any other special relationship or privilege. You should not rely upon this post for any purpose without seeking legal advice from licensed attorneys in the relevant state(s).
Compliance with Laws. You agree to use the information provided herein in compliance with all applicable laws, including applicable securities laws, and you agree to indemnify and hold Inna Efimchik and White Summers Caffee & James LLP harmless from and against any and all claims, damages, losses or obligations arising from your failure to comply.
Disclaimer of Liability. ALL INFORMATION IS PROVIDED AS-IS WITH NO REPRESENTATIONS OR WARRANTIES, EITHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT. YOU ASSUME COMPLETE RESPONSIBILITY AND RISK FOR USE OF THE INFORMATION IN THIS POST.
Inna Efimchik expressly disclaims all liability, loss or risk incurred as a direct or indirect consequence of the use of any information provided herein. By using any information in this post, you waive any rights or claims you may have against Inna Efimchik and White Summers Caffee & James LLP in connection therewith.