Archive for August, 2007

Should You Sell Or License Your New Product Or Idea

Thursday, August 16th, 2007

by Dan Stalfire

Patent Selling
Why Sell:

A patent is your property and as such you have the legal right to do with it as you wish. Generally you would choose to sell your patent if you would;

1. Focus your attention on other ideas.

2. Turn over the entire rights to your patent and be done with the venture.

3. Generate a quick income from the sale.

A patent owner has 4 basic choices they can make with their invention:

License Your Patent:
By far the most profitable. This allows you to maintain ownership of your idea, while allowing another company to build and market the idea. This is what InventorsIPO specialize in. We find a company to build, market, and pay you a fair market value for the use of your idea.

Build and market the product yourself:
You can build, market, and do the legal work yourself. This is a complicated process that requires a large amount of capital, time, and knowledge of the market.

Sell the Patent:
All patent owners have the right to sell their idea. This process requires the ability to find a buyer, a lawyer, and understand what the market value of their idea is.

Do Nothing:
Believe it or not, the vast majority of patents granted by the U.S. Patent Office have never been acted upon. About 90% off all patents are never commercialized!


Why License Your Idea?
Licensing your idea to an established company has many advantages.

Your product will carry the label of a company that has a well known and respected name. Most individuals cannot, and should not approach large companies like Wal-Mart, Target, etc. They usually will not look at people who only sell one product, they prefer vendors with multiple products.

Most larger companies have a complete marketing and Public Relations department. Larger corporations have the capital and resources available to launch a product properly. By allowing another company to build and market your product they generally assume the liability also. Thus if for some reason something happens that has legal ramification they will usually handle it.

You get paid royalties for doing nothing. Of course it is your idea, you did invent it and file the appropriate patent application. But what we mean is that you will get paid, while they build it, market it, promote it, and do all of the ground work.

Dan Stalfire is the president of, SEO ONE, inc. and Internet Marketing Images, Inc. Dan has over 20 years experience in inventing and intellectual property. Mr. Stalfire is actively involved in inventing and marketing. Holding a US. Patent and a Federal Trademark he has assisted numerous inventors with their marketing and product launches.

For more information visit

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Nondisclosure Agreement And Intellectual Property

Wednesday, August 15th, 2007

by Alexander Gordon

Modern age companies, unlike the traditional firms, are spending colossal amount of resources in two key areas i.e. a) undertaking research and b) training manpower. These resources contribute to firm’s hard earned intellectual property pool. Another key distinction among the firms of then and now is the growing decentralization wherein firms are no longer trying to stay in a cocoon and avoid any outsiders. This era is marked by growth through expansion and external investment. However any such growth or transition not only implies external investment but also is indicative of involvement of more players, of which many could not be trustworthy. But to succeed it is imperative to open out. Than what is the way out to prevent miss-use of such information spread among associates, colleagues and employees?

Enables Spread of Information in the Desired Form: A nondisclosure agreement with the information sharers proves to be a handy tool in such situations. This vital instrument helps prevention of flow of key research outputs and other such information to any undesired sources, while at the same time keeping the requisite details available for all concerned. Such an understanding among associates not only substantiates as a legal document in any eventual legal proceedings but the only existence of the same de-motivates all concerned to take any action against the company’s interest.

Keeps a Check on Competition: A nondisclosure agreement therefore acts as a preventive tool and at the same time curbs internal competition by preventing those involved from opening up their own individual initiatives in the same field of work in a specified area for a particular period. This is your information and therefore does not deserve to be used by others for personal use.

Acts As an Employee Retention Tool: A clearly defined nondisclosure agreement between the employer and employees also acts as an important instrument against increasing instances of employee fraud. A limiting factor, which discourages employee to join direct competition for better packages, is like magical wand to the disturbed employees who spend enormous amounts just to recruit, train and retain employees. Nobody wants to be training school, especially for competition, than why not prevent loss of such crucial intellectual property resources.

Various Non- Disclosure Agreements (NDA) are posted online and cane be referred to for making an NDA. However to ascertain if the same fulfills the desired guidelines and covers the loopholes depending upon the company’s functioning within the legal framework it is advised to get the same made form the professional. This would though entail a one time fee, yet this cost could save those enormous losses arising out of miss-management on account of information and resources i.e. company’s valuable intellectual property.

Alexander Gordon is a writer for – The Small Business Consulting Community. Sign-up for the free success steps newsletter and get our booklet valued at $24.95 for free as a special bonus. The newsletter provides daily strategies on starting and significantly growing a business.

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FAQs – Licensing Intellectual Property (IP)

Tuesday, August 14th, 2007

by Jean Sifleet

Licensing is a key business strategy. It’s a way to maximize the earnings from inventions and creative works, which are called intellectual property or "IP.".

What is licensing?

Licensing is when you grant some rights to intellectucal property "IP" that you own. It is really a partnership of mutual cooperation between the licensor, who owns the IP, and the licensee, who is given the right to use it for certain purposes.

Question: What are royalties?

Royalties are a way of calculating compensation for use of intellectual property. The licensee is granted the right to use it for a royalty. Royalties are usually based on a percentage of the revenues that are generated. For instance, if I license my course to a company and say, “For every subsequent use of this course, I get 5% of the revenue,” that’s the royalty — 5% of the revenue would be the royalty/payment that I would receive.

Question: Are there rules of thumb for royalty amounts?

Figuring out what royalty to ask for is always a challenge. As sort of a really rough rule of thumb, the allocation of the revenue generated can be 25% for the licensor and 75% for the licensee. This is because the licensee is usually doing all the sales and marketing related to generating revenue. It varies greatly from industry to industry.

Question: What are some examples of the types of works that can be licensed?

Many types of IP can be licensed. For example, copyright-protected works, trademarks, and patented inventions can be licensed. Materials and know-how may be licensed and generate additional income. Other examples include images, photographs, music, a recording – on any kind of media.

It’s very difficult to license something that has not been reduced to writing or some kind of tangible form. Just trying to license “know-how,” for instance, is very difficult. Someone could have a lot of expertise, but unless they turn it into something concrete or tangible, it’s difficult to license it.

Question: What are the pitfalls of licensing?

A classic pitfall is that the licensee does not pay royalties. The licensor gives rights to a licensee and the licensee doesn’t do anything with them. So the licensor’s IP rights are tied up in the license agreement, but the licensor isn’t getting any money for the IP. I recommend that a licensee be required to pay at least a “minimum” royalty or forfeit the license. That way, the licensor is guaranteed a certain level of revenue. That’s also motivating for licensees because they’re going to have to pay that money in order to keep the license, so they’re going to focus on using your IP.

Another pitfall is granting an exclusive license, or giving away way too many rights. The scope of the license grant is extremely important. For example, one situation that I’m familiar with involved a patent for a chemical process. It was licensed to a very large pharmaceutical company. But in that license, we were very careful to limit it to medical applications. We turned around two years later and licensed that same patent to a paint company. Had we granted all the rights in the first license, we wouldn’t have been able to do the second licensing agreement, which was a very different market and a very different application.

Question: What if I want to use someone else’s work?

Using someone else’s work is sometimes called “licensing in.” That’s a very good business strategy as well. Why recreate the wheel if you can use materials that are out there or content that’s already been created? Usually, what I suggest is that you approach the owner of the IP and say, “I’d like permission to use some of your materials,” and you negotiate an agreement.

It’s OK to use other people’s works (without payment) if the work is in the public domain or if the use is considered to be within the “fair use doctrine.” (See enews archives for further discussion).

Question: What if someone copies my work?

Registering copyrights is an important step. If an infringement occurs after the copyright is registered, you can recover statutory damages per infringement and attorney fees. If an infringement occurs prior to registration, you can only recover actual damages, which are extremely difficult to prove.

Question: What is a territory?

Licensors try to specify territories for authorized use. Say, for instance, you have a way to fix cars and you were going to deliver a training program and it required on-site training to show people how to do this particular type of repair – fix the paint or fix the dents. That’s a service that would probably be delivered in person, so it makes sense to carve that up geographically.

But, if you market on the Internet, it’s really hard to specify a geographic territory. For example, if you’re developing an e-learning kind of program and it is going to be marketed over the Internet, then it’s very difficult to restrict geographies, just because you could have potential customers coming from anywhere in the world.

In conclusion, these are just a few of the frequently asked questions about licensing. Licensing is a great way to generate revenue from IP. Is licensing a strategy that you want to explore for your business?

Jean Sifleet is a practical and experienced business attorney whose career spans many years in large multi-national corporations and includes three successful entrepreneurial ventures. Jean has extensive experience in dealing with intellectual property matters in the large and small companies and as a small business owner. She has authored numerous books and publications on avoiding legal pitfalls in doing business. This article is excerpted from her new book, Advantage IP – Profit from Your Great Ideas (Infinity 2005). For more information, Jean’s website is

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The Average Cost of Getting A Trademark

Tuesday, August 14th, 2007

Trademark Icon

Every trademark is words that are distinct, which may be logos, pictures, motto, that are well used to identify the product. These trademarks are capable of being protected under the Federal sate and also a law. Such federal registration offers maximum protection, says. According to a research from, trademark fees are always broken to number of distinct parts namely filing fees, fees of an attorney, and fees for a trademark. Lets now what advises you about the average cost of attaining a trademark.

Usually it costs roughly around $280-$380 if filed through paper to attain a single trademark sign for a set of products with USPTO (United States Patent and Trademark Office). Online submission of papers may reduce the cost little extent.

Average Cost of Getting a Trademark

Average Cost of Getting a Trademark

Trademark applications can also be filed through online forms that are present in the United States Patent and Trademark Office. Still extending more, many commercial vendors are available in the market that process and gather the information to place your application in the right place whenever necessary. But this kind of process eventually increases the fee. Those individuals who would like to hire an attorney, normal charges shall be requested.

Filing fee for a single trademark sign in single class may be $325 or $375. Searching of trade mark may take around $400 – $600. If you are round through an attorney, the fees for a trademark opinion shall be around $500-$1000. And further, the fee for Trademark filing application will be from $1000 to $1500.

It is very much important to note that any person can start the trademark application work. It is much important to realize that a single trademark application is filed without making a search. But still a search and opinion is preferred. Further more, a trademark search lets you to gather information if others is using similar trademarks when compared with you. Additional costs are often charged by the government attorney, says, when he reviews the application and decide whether the trademark can be registered or not.

Legal Terms – A Quick Guide

Monday, August 13th, 2007

by Richard Chapo

Legal issues and problems are stressful, complex and inevitable. If you get wrapped up in legal issues, it sometimes helps to understand the lingo being bandied about.

Legal Terms

Contract: An agreement between two or more parties in which each party agrees to provide something in exchange for the other party doing the same. Typically, one party provides money while the other provides a service or product. Contracts can be oral or written, but oral contracts are difficult to enforce.

Copyright: The legal right attached to literary, musical, dramatic or artistic works. Copyright automatically attaches to the piece in favor of the creator of it. To sue for copyright infringement, the creator must file for an official copyright from the Library of Congress.

Intellectual Property: A product or idea that has tangible commercial value. Examples of intellectual property include copyrighted works such as books, patented items such as a product design and a trademarked item for a brand. The word “Amazon” is not considered intellectual property. When applied to the Internet, however, the word is intellectual property as it refers to a brand for an online bookstore.

Non-Compete Agreement: An agreement whereby one party, typically an employee, agrees not to use information learned during employment in subsequent business efforts for a set period of time. In some states, non-compete agreements are extremely difficult to enforce. An example of a non-compete agreement dispute is the current litigation between Microsoft and Google over Kai-Fu Lee.

Non-Disclosure Agreement: A contract binding one party to a duty of confidentiality in regard to certain information provided by another. An NDA typically is executed where one party wished to discuss a business venture with another and the discussion necessarily requires the disclosure of sensitive information.

Trademark: A name, label or symbol identifying a product or web site. Trademarks are filed with the Patent and Trademark Office and restricted to a class of products or services. “Amazon” is a trademarked term for Internet services, but not for general references such as ecological discussions.

Obviously, this is a relatively short list of legal terms. If your issue is not mentioned, you can search on the net to find an answer.

Richard A. Chapo is a San Diego business lawyer with – providing legal services and legal advice to businesses in San Diego, California.

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Protect your Idea with an NDA

Monday, August 13th, 2007

How To Use A NDA to Protect Your Idea When You Don’t Have A Patent

For most of the companies found over the market today, a most valuable asset is the IP(Intellectual Property). advises you to take proper and necessary steps for protecting your own asset to utilize with full potential. A NDA or a Non-Disclosure Agreement is often called as statement of confidentiality. This statement allows a company for sharing an Intellectual property with others around you without jeopardizing information. For instance, if you are having a new product, say, a proper Non disclosure agreement will ensure that the expert is not handling the details of your new product.

A Non-Disclosure agreement is a kind of legal contract between an individual and another one. Further more, you also agree thereby for disclosing certain important information for a specific purpose. Also, they agree not to expose any information to public. A Non disclosure agreement is the only way for protecting your intellectual property. You use NDA when you are having information which you should convey to someone, but not to pass that to anyone else.

When you don’t have a patent, NDA will be very helpful for making a strong agreement. Many companies may have a NDA like, as posted over the web for some reasons. There are lots of similarities within them; still they show a very huge range of industry. As for any legal document such as a non-disclosure agreement, you may need to consult a trained professional to avoid certain legal problems. But, better don’t rely on the forms which are available on the net unless/until you are well qualified to do that.

Intellectual Property

Sunday, August 12th, 2007

by Dr. Louis M. Scarmoutzos

Intellectual Property (IP) is a valuable asset that is included in a company’s “balance sheet” and provides additional valuation to a company. For early stage and small companies, IP may be the company’s sole or primary asset base.

Intellectual Property includes patents, trademarks, service marks, copyrights, and trade secrets. This value-added asset can be sold, bought and traded as a part of everyday commerce.

It is important for a company to know what IP it has and how to enhance the company’s IP position which, in turn, enhances the company’s valuation.

Patents are often the most valuable IP asset for most companies. Strictly speaking there are three types of U.S. patents:

(1) Design Patents (for example, an ornamental design for an article of manufacture)
(2) Plant Patents (for example, an asexually produced flower or plant)
(3) Utility Patents

The most common patent for technology-based companies are utility patents. Utility patents are granted to inventors according to the Patent Act, which can be found at Title 35 of the United States Code (U.S.C.) and states as follows:

“Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefore, subject to the conditions and requirements of this title.” (35 U.S.C., §101)

Equally as important as what is patentable is what is not patentable. What are not patentable are:

(1) Laws of nature
(2) Physical phenomena
(3) Abstract ideas
(4) Products of nature

However, what constitutes patentable subject matter has come under broad interpretation as a result of the U.S. Supreme Court decision in Diamond vs. Chakraborty (1980), which established that companies or individuals could receive utility patents for newly created organisms. Since then, the biotechnology industry has argued that patents should issue on genes, proteins and other natural materials which have commercial value.

Primarily as an effort to boost U.S. eminence and competitiveness to the then fledgling but growing biotech industry, shortly after the Diamond vs. Chakraborty decision the U.S. Patent Office (USPTO) began issuing patents on products of nature including genes (human or otherwise), gene fragments, cell lines, proteins and other naturally occurring substances.

As a result of increasingly growing criticism, the USPTO has recently issued utility patent guidelines and rules regarding a stricter definition of what is invented or patentable. These new guidelines and rules call for utility patents to have “specific and substantial utility that is credible.”

No longer will it be sufficient to claim that a particular biological or molecular probe (DNA, protein, etc.) to be a useful probe, the new utility test calls for specific utility regarding that particular molecular probe (i.e., a probe for a particular gene, a probe for a specific disease state or a probe for a defined location on a chromosome).

In addition, it is no longer acceptable to make general claims regarding utility and usefulness. For example, it will not be acceptable to claim that a protein is a source of amino acids or a feed supplement or a dietary supplement, but real-world utility must be specified and demonstrated.

The new utility patent guidelines and rules will have a profound effect on the biotech and related industries.

Visit for additional information concerning Intellectual Property and the business of science and technology.

Louis M. Scarmoutzos, Ph.D., or “Dr. Lou” as his colleagues and friends fondly call him, is President & Founder of MVS Solutions, Inc., a corporate and technology development company focused on the biotech, chemistry, pharma, medical and related industries.

Dr. Scarmoutzos received his B.S. cum laude in Chemistry from Boston College, a Ph.D. summa cum laude in Physical Organic Chemistry from the Pennsylvania State University and was a Post-Doctoral Fellow in the Department of Chemistry and Chemical Biology at Harvard University. Dr. Scarmoutzos serves as a Principal Advisor to the Los Angeles Research and Technology Association (Larta) Life Sciences Technology Group and a Principal Advisor in the National Institutes of Health Commercialization Assistance Program (NIH-CAP). Additional info about Dr. Scarmoutzos and MVS Solutions may be found at or via email at

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Five Key Questions About IP Help Increase Market Value and Improve Bottom Line Results

Saturday, August 11th, 2007

by Mark Partridge

Intellectual assets are critical to business success in today’s global market.

If you are a CEO, CFO, GC or other business leader, asking questions about these assets will help you to bring added value to your company.

Failure to consider these issues yields adverse business consequences, including unrealized value, unnecessary expense and legal risk.

Routine attention to intellectual asset management can avoid these consequences, yet many businesses miss this opportunity simply for lack of knowledge and attention.

Intellectual Assets

What are intellectual assets? Essentially these encompass all of the intangible assets of an enterprise.

From the business point of view, we’re talking about brands, logos, packaging, corporate identity, ideas, business methods, marketing information, published content, secrets and inventions.

From the legal point of view, they are trademarks, copyrights, trade secrets and patents.

Five Key Questions

1. Maximize IP Assets.

"Have you established a clear claim to your IP rights through registration?"

Brands, packaging, ideas, inventions and content have greater value to investors and purchasers if they are secured by registrations. Companies with strong portfolios of registered rights are worth more. For example, the S&P 500 traded at a market-to-book ratio of 4.7 in 2003. At that rate, tangible assets amount to less than 24% of market value, with intangible assets such as brand and goodwill accounting for more than 75% of market value. This fact presents an significant opportunity for companies with low valuations to create market value.

2. Domain Name Registrations.

"Do you have domain names properly registered to avoid inadvertent expiration or improper transfer by former employees or ISPs?"

In our practice, we routinely deal with companies that have lost domain names because they failed to maintain registrations in their own names or lacked a sound system for managing renewals. It can happen to anyone, large and small, as illustrated by Microsoft’s well-publicized loss of the domain name The cost of prevention is small, while the expense of recovering lost domain names can be high.

3. Content Protection.

"Is the content of your website, manuals, publications and other materials adequately protected?"

Copyright registration and notice is not a prerequisite to protection, but early registration is required to benefit fully from the remedies provided under copyright law. The failure to register copyrights before infringement occurs results in the loss of the right to recover statutory damages and attorneys fees. Many small clients find that enforcement is an unrealistic expense without the benefit of those remedies, yet registration of copyrights is simple and inexpensive.

4. Enforcement.

"Have you allowed third parties to steal or erode your intellectual assets?"

The failure to take action against infringers results in loss of revenue and rights. Haphazard enforcement efforts can be expensive and ineffective. Companies that practice effective intellectual asset management will work with counsel to create a strategic enforcement plan that reduces overall legal expense while maximizing IP rights and avoiding the loss of rights through inaction.

5. Insurance coverage.

"Do you have insurance coverage for IP claims against the company?"

Many companies have coverage for IP claims and don’t realize. Many companies do not, and should. Coverage is often hidden away in an "advertising injury" clause. Courts have often read these clauses more broadly than they appear on their face. As a result, coverage can easily be overlooked. When a prominent New York law firm famously failed to advise its client about coverage and tender a timely claim, defense coverage was later denied, costing the company millions in legal fees.

Added Value

Asking questions about intellectual capital issues can increase company value and avoid risk. Effective management of these rights is the key to success in the information age.

Author, speaker and attorney Mark V.B. Partridge is an internationally recognized expert in intellectual property with over 25 years of experience helping major corporations, entrepreneurs and creative professionals protect their IP rights. As a professional speaker, he offers seminars, workshops and keynotes to help business leaders use IP to turn intellectual capital into incredible value. His book, "Guiding Rights: Trademarks, Copyright and the Internet" is available at and other online bookstores. For more information, visit

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Using Someone Else’s Patent to Bring A Product to Market

Friday, August 10th, 2007

by Laurence Winslow

Often inventors and innovators will come up with a way to make a better mousetrap. Often they will find others hold patents to a critical component to make this better mousetrap innovation or invention. Therefore they need to make a deal with the company or individual holding the patent so that they can use this technology to make their invention and sell it. One way to do this is to offer to pay them a per unit royalty on each unit made or sold. And most savvy companies who agree to this will want audit rights to check the books on how many items were built and/or sold by the better mousetrap maker. Recently I was asked by a innovator and think tanker; “I need more insight on the audit rights you talked about?”

Well if you started selling them and were going to give them a per unit stipend then they would need to be sure you told them of “ALL” actual sales; That makes sense right?

“Is it possible that they might offer the seed money to put together a prototype?”

Yes, if I were an executive of that company holding the patent, I would put you in contact with my engineers and sit at a table and listen in on the meeting, then take notes, prepare and agreement, think on it for a day, discuss options and have my lawyer draw it up and have the whole thing done within two days, give you parts and make some renditions.

If my company is to fund your project with you, we would want to make sure the product sells well, since we are wholly invested with our technology and now capital in your project. And we would need to sign a deal or I might even consider putting you on and keeping you on the company payroll.

You see either way, whether you make it for them, for yourself or they make it for you or for themselves. The company may consider various options if you have a good business plan and innovation using their technology. Indeed the better mousetrap builder should know who they will be dealing with and should learn everything they can about the company before approaching them. Think on this in 2006.

“Lance Winslow” – Online Think Tank forum board. If you have innovative thoughts and unique perspectives, come think with Lance in the Online Think Tank and solve the problems of the World;

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Working With A Patent Attorney

Thursday, August 9th, 2007

by Sujith Pillai

Patent attorney – hiring one is very expensive. Still, you need one for filing your patent. So, how do you go about hiring one?

Most newbies consult with a patent attorney as soon as they have an idea which they want to pursue. The patent lawyer will advise that filing for patent protection is the very first step to be taken. Immediately, the newbie budgets an amount for this, and throughout the process, will spend a considerable amount of money. At the end, he/she may learn that the patent idea is not marketable!

Some tips to do this the right way:

  1. When hiring a patent attorney, always go with those who offer a free initial consultation
  2. Make sure the patent attorney has filed similar patents before. An example: a patent attorney who has filed software patents for his (or her) clients will be able to better handle your patent application for something like translator software. 3. Make sure the patent attorney will not charge you for simple queries.
  3. Make sure the patent attorney provides you with a cost estimate, once you provide him with a summary of your idea.
  4. Always prepare an initial draft of the patent application. This will save you a lot of money, since the time spent by the patent attorney to draft the application will be lesser.
  5. Find attorneys who are willing to start without a retainer
  6. Find out a patent attorney who understands your needs, and is willing to communicate with you.
  7. Do not ask the patent attorney general questions which you can find by reading books or surfing the Internet. Remember, you are paying for his time!

Feedback: please send your feedback to: info at intellectualvillage dot com – we will greatly appreciate it!

This article was published at brings you interesting patents and inventions from all over the world. It also provides free resources for inventors.

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