Forums: Discussions for entrepreneurs and small business.

Hi All,

 

This is my first post, but in reading other posts I think I have a shot at getting some good advice.  I apologize in advance for the length but I have a few questions embedded within.

 

Here’s an overview.  My wife loves to burn scented candles but sometimes forgets to blow them out.  About 3 years ago I began thinking about how I could improve candle safety so that I wouldn’t have to worry about a candle burning down the house.  After countless weekends and late nights of brainstorming and prototyping, I came up with a very unique design.  2 years ago I took a vacation day and visited about 6 IP law firms and settled on one that I felt was the best for this idea.  The patent application received a first office action which rejected every one of the 37 claims.  My lawyer assured me that he believes that this is a unique idea and that the examiner is incented to reject every claim.  He has now tightened up the claims and resubmitted and I’ll need to wait about 3 more months before hearing back.  What a racket, the examiner incentive is to reject every claim and the IP lawyer tries to write the broadest claims possible.  This doesn’t make for a very good way of conserving and inventor’s cash.  QUESTION 1: Am I alone here or is this a typical scenario?

 

After filling the application, I hired a design firm to design a working prototype.  This firm had the expertise in air care products which was critical because this product required knowledge of air flow.  I now have a professional looking prototype 100% SLA with working circuit board, they did a great job but the total services cost me about $40K.  I began to look for potential licensees for this product idea and was able to make inroads with a direct marketing company.  They are a direct marketer of candles and accessories via home parties similar to Tupperware and Avon.  I began talking with them in January 2006 and I’ve gotten as far as leaving the prototype with them so that they could test.  They were very impressed with the performance of this product and when they presented to their execs they were very interested in pursuing the idea.  A few months later I finally get an email from my “product champion” and she tells me that the next step is for their IP lawyer to call me.  The IP lawyer called me and asked for the patent application number and said that the next step would be for me to sign an option agreement which would allow them to evaluate the idea to make sure pricing would work for them, among other things.  I would give them 3 months to research and they would give me some amount of money as compensation for not approaching any other company.  A few days later she emails me asking if I had gotten an opinion of the idea which I told her I hadn’t.  (But I can say that a thorough patent search between me and my IP lawyer revealed nothing close to this idea.  And in my PTO application, the UK patent office found nothing similar.)  That was my last communication with their lawyer.  I have since emailed a few times with no response.  It has been almost 4 months since their in-house test of my prototype.

QUESTION 2:  Has anyone ever gone through something like this and if so what happened?  Any advice? 

 

I’ll add just this last bit of information.  I was very honest with my product champion and told her that I wasn’t very aggressive in approaching any other companies.  But this weekend I lost my patience and began calling other companies like their direct competitor.  After consulting my lawyer, I also submitted my idea to Dial Corp’s website.  QUESTION 3:  Should I turn up my aggressiveness and begin pounding on doors even though this company may very well be close to licensing this idea?  Should I maintain radio silence with them so that they think I’m looking elsewhere and force them to contact me?

 

Any help is appreciated!

VelaRosa

I am currently in the same position pursuing a license agreement. Fortunately I am trying to negotiate a deal with a small but very successful company. I have not had to play such a waiting game as you have mentioned though. Are you set on licensing your product? If you can pursue it on your own, I recommend reading Barbara Careys book, The Carey Formula. I have read it and there is great inspiration and a great formula there for bringing your products to market. I would pursue other companies until you find the deal you want and get it in writing if you are set on licensing. 

Hi VelaRosa,

QUESTION 1: Am I alone here or is this a typical scenario?
Yes, that is a typical scenario, it is the examiner’s duty to make you ‘prove’ to him that your claims are valid, that is pretty much standard operating procedure. However he should’ve explained why by giving a valid reason with documentation (references) for each claim rejection.

QUESTION 2:  Has anyone ever gone through something like this and if so what happened?  Any advice?

Everybody unless he/she comes up with something for which there is absolutely no (valid) precedent i/e a perpetual motion machine for instance. However if you were to attempt to patent such a thing you’d run into yet another problem, according to the USPTO you can’t even file an application for a perpetual motion machine :-)

QUESTION 2b: Any advice?

Play by the rules, explain why your claims are valid, invalidate all objections and prior art he`s presented.

QUESTION 3:  Should I turn up my aggressiveness and begin pounding on doors even though this company may very well be close to licensing this idea?

Not without first notifying them of your intentions and giving them a prudent amount of time to remedy the situation. For legal purposes make sure you keep records of all your communications, instead of an e-mail send it via registered mail.

QUESTION 3b: Should I maintain radio silence with them so that they think I’m looking elsewhere and force them to contact me?

After the grace period given to them to remedy the situation has elapsed, sure go ahead, all legal arrangements/agreements have an expiration date, theirs is way past it. Before you move forward make sure that is what you intend to do, do not upset a potential licensee by being impatient. Once the decision to move forward has been made, never look back.

One last thing, make sure your lawyer agrees with everything you intend to do. You don’t want to create a potential liability for yourself in the future.

Good luck!

I am pretty set on licensing but I think I`ll pick that book up anyway. Thanks for the suggestion. 

How soon after you made contact with this potential licensee did you sign an option agreement of the like?  Did you have a patent granted prior to approaching companies?  I have a feeling I may have volunteered information to them all along that weakened my leverage.  It certainly doesn`t help that I still don`t have a granted patent.

Yes, I have been communicating with my IP lawyer every step of the way.  Fortunately I`m not under any agreement at all with this company but what I have given them is my patience with the hope that it would bring good news.  I`d like to hear other experiences with regard to how long this courting lasts before royalty discussions begin.

Thanks for your help.

Contact me via PM and I will share with you a contact who is a friend of mine who is a top sales distributor for a home based candle company. She would be interested in talking to you. 

-------------------------

<A HREF="http://www.AuditAuctions.com">Get ISO Certified</A>

If you don`t mind hearing my two cents,
Another book to pick up is called Patent It Yourself by Dave Pressman @
Nolo Press- It is the standard by which MANY "IP" Lawyers refer to for
current procedure. It covers everything you need to file an Iron-Clad
patent application for pennies on the dollar a lawyer charges. One of the
chapters goes into great detail about how to approach potential buyers &
the wording of proposals such as your dealing with. One very strong form
of leverage is telling your prospective buyers that you will be visiting their
competitors with the same offer your bringing to them, so a timely
decision would be in their best interest.
Also, unless you plan on taking the product abroad, the lawyer is an
unnecessary expense. I know you don`t want to hear this but when you
read the book you`ll see why. Want to know the biggest secret of all? The
Provisional Application. You will have to look this up to see if your still
eligible to use this option, but it basically allows you twelve months to
create your prototype while still giving you the Offensive Rights to secure
your invention on file with the PTO. Don`t let these people intimidate you,
this book was written by one of the best patent attorneys anywhere- and
any GOOD lawyer will admit that. If not you know what kind your dealing
with.
The bottom line is this: YOU are the person best able to describe & build
your invention, and the laws are there to protect YOU. Don`t let a lawyer
muddy that FACT by telling you it`s not that simple. My son was 1 year
old when he helped me concieve a very ingenious device. I went to several
lawyers & even a most prestigious law firm with international ties to
secure IP protection AND have him named as co-inventor. They not only
told me that this couldn`t be done- They WOULD NOT do it!
What does the Law say? According to the U.S.P.T.O. ANYONE regardless
of AGE, RACE, SEX, COLOR, CREED, MENTAL STATUS, EVEN SOMEONE
WHO`S DEAD can file a patent! So do yourself a big favor and become
educated in patent law, it`s not hard at all- just buy the book & a new set
of highlighters & underline everything you read that pertains to your
device. You may find you have more Intelectual Property than you initially
thought.
Remember- it`s our ideas that change the world, and the word Genius
literally means "Genie With-in."
Hope this helps you.
Rob O.

-------------------------

Until you walk a MILE in another man`s Moccasins-    You can never Know the man!!!