Introduction to Patents in the U.S., the process, and costs as well as the value Intellectual Property brings to businesses.

1. Patents 101 and
Patent Prosecution
Larry Baratta
Partner and Patent Attorney, Electrical Practice Group
Admitted in NC and GA, USPTO registered
1901 Roxborough Rd., Suite 250
Charlotte, NC 28211
www.worldpatents.com
704.790.3600
lbaratta@worldpatents.com

2. About Clements Bernard PLLC
 Charlotte, NC – based Intellectual Property Boutique
 Specializing in Electrical, Networking, Software, Mechanical, Chemical, and Biotech
Fields
 Focus
 Patent and Trademark Prosecution and Licensing, Opinions, Transactional matters
 Intellectual Property Litigation (Patents, Trademarks, Copyrights, and Trade Secrets)
 Representative Clients
 Publicly-traded companies
 Numerous venture funded start-ups
 U.S. Government Agencies
 Entrepreneurial Individuals
 Value to Clients
 Reasonable, Fixed Fees offering clients deterministic, fixed-fee pricing
 Individual focus from seasoned attorneys
 Business minded
 Experience - Former Patent Office Examiners in-house & Attorneys with in-house
engineering industry experience
www.worldpatents.com

3. What is Intellectual Property (IP)
 Intangible Property Rights including, for example, ideas, inventions and
other innovations, expression, indications of origin and confidential
information
 Patent
 Copyright
 Trademark
 Trade Secret (protected by State law)
 Almost all aspects of technology, innovation, and/or works of authorship
(including software) or art are addressable as IP
 IP rights arises from Operation of Law
 In U.S., Constitutional Basis – Article I, Section 8, Clause 8:
 “To promote the Progress of Science and useful Arts, by securing for
limited Times to Authors and Inventors the exclusive Right to their
respective Writings and Discoveries”

4. Patents, Copyrights and Trademarks
Inventions
Machines, methods,
composition of matter,
improvements
Any name, symbol, device or
combination that
-identifies source
-distinguishes goods and
services from another
“Original expression”
“Fixed in tangible medium”
Not novel, obvious, not useful
(no utility)
Functional
Does not exclusively identify
Descriptive
Ideas, Facts, Methods and
systems (patents)
Idea – expression is
protected, not idea
When patent issues From use; Protection can last
forever and can also
disappear since protection is
tied to use
From time fixed in a tangible
medium
Fall within scope of a patent
claim
Likelihood of confusion Copying with Access and
Substantial Similarity
Patents Trademarks Copyrights
Type
Not
Protected
When
Protected
Infringement

5. What is a Patent?
 In the U.S., Granted by the U.S. Patent & Trademark Office (USPTO)
 Part of the Commerce Department
 Protects: Manufactured items, Equipment, Processes, Compositions and Improvements to the
above
 Rights: Right to exclude others from making, using, offering for sale, selling and/or importing
what is claimed
 A negative right of exclusion only
 Term: 20 Years From Filing or priority date – extensions available based on PTO delay
 Territory: United States and its territories
 Rights Arise: Upon issuance of a patent, arising from a patent application filed prior to public
use, disclosure or sale

6. Sample Patent
 U.S. Patent No. 6,469 to Abraham Lincoln, 1849
 The 16th
President is the only President to receive a
U.S. Patent

7. Patent Claims
 Section in the patent or application that defines the legal scope of protection
granted by the patent
 Parts
 Preamble – recites the class of the invention and optionally primary purpose; e.g. “A
system,” “A method,” “A network for providing…”
 Transitional phrases
 "comprising", "containing" and "including" are most often used to mean "having at least the
following elements..." and are therefore open (inclusive) and do not exclude additional
limitation
 "consisting of" and "consisting essentially of" are more limiting, as they mean "having all and
only" or "virtually only" and are therefore closed (exclusive)
 Elements and/or Steps
 Defines the invention and includes interaction between the elements.
 A system, comprising: X, Y, and Z – X, Y, and Z are elements
 A method, comprising: A, B, and C – A, B, and C are steps
 Limitations
 Clauses that define, i.e. limit, the elements and/or steps
 wherein X is communicatively coupled to Y and Z for control thereof

8. Patentable Subjects
Systems, Devices & Other Manufactured Items
Such as manufactured equipment, e.g., electronic devices or circuits,
semiconductors, systems configured to perform a function,
networks, components, etc.
Processes or Methods
Such as manufacturing processes or
methods of doing something—may be
implemented as software or as a
business method
Materials/Composition of Matter
Chemical, Genetics, drugs, compounds, etc.

9. Patentability Requirements
Novelty
 Does not exist in the prior art; Not previously disclosed
 OK if Modification of an existing product/process, or use of something “old” in
new/different way
Usefulness
 Utility - Performs a useful function, does it work?
 An easy requirement to meet in mechanical and electrical arts. Sometimes difficult in
chemical and life sciences – “I have a new compound, I just don’t know what it does yet” –
therefore, no utility
Non-obviousness
 A knowledgeable but relatively unimaginative person working in your field would not have
been led directly to the invention in light of the available information at the time of
invention.
 This is difficult to describe in general, as lawyers the focus on non-obviousness is generally
based on prior case law for guidance.
 Is there a suggestion/motivation/teaching to combine existing knowledge (i.e., one
or more existing pieces of art) to solve the problem your invention solves?
 This is the current legal test, and it allows the Patent Office to reject an invention as
obvious if the elements and limitations of the invention can be found in one or more
references, and if there is a reason, i.e. suggestion, to combine them.
 A rejection under obviousness generally involves “combining” one or more references to
meet all of the limitations and elements of the claimed invention

10. Patentability Requirements
 Novelty (35 U.S.C. 102)
 Generally applies to all technology areas
 Utility (35 U.S.C. 101)
 Typically an issue in chemical, biological, and pharmaceutical arts – “I have this new
compound, I just don’t know what it does yet” – i.e. must have a practical application
for patentability
 Non-Obviousness (35 U.S.C. 103)
 This is a typical rejection in the Electrical/Software/Mechanical arts
 Two or more separate references combined show all elements of the invention
 Must show distinction over these references or why these references cannot be
combined in light of the claimed invention
 Subject Matter (35 U.S.C. 101)
 An issue in the Software arts
 In light of court precedent, software-related inventions must be tied to a particular
machine or perform a physical transformation of a physical device

11. Inventor
 The person(s) who first conceived the invention
 Joint inventors - Each inventor must have
contributed to the subject matter of at least one
claim
 Non-Inventors:
 Persons who implement the ideas of others
 Persons who have obtained the entire idea of an invention from another are
not inventors
 Persons who suggest concepts without contributing to the means for carrying
out the suggestion (“Wouldn’t it be nice if….”)

12. When to file a Patent Application
You Develop, Improve, or Do,
Something New or Different!!
• You solved a problem or
developed something new and
useful
• Your solution for the problem
is not the same as another’s
solution for the same problem
**Note that use of something known in a new, non-obvious, and
different way or to solve another problem can be patentable!!!**

13. What to Disclose
 General
 Has this invention been discussed with others:
 Inside or outside of your company? With Whom? When?
 Was there a Non-Disclosure Agreement in place?
 Have you done a search? Key Words for Database Searching
 Is this Invention relevant to a Standards activity?
 Describe the Invention
 “Tell a Story” - start at high level, then work down into details,
including:
 What is the Invention about?
 What Problem does it solve?
 What other Solutions have been tried or exist, and what were their shortcomings?
 What are the Specific Elements or Steps that solved the problem?
 What are the values of the Invention
 Disclosure Submission Form

14. Patentability Search
 Search of U.S. and Foreign patent applications and issued
patents and non-patent literature (journals, white papers,
etc.)
 Objectives
 To ascertain whether the invention has been patented or disclosed
previously and, thus, would be unpatentable;
 To avoid filing a patent application and having it summarily rejected
by the Patent Office because of an identical or substantially similar
invention which would render your invention not new or not non-
obvious; and
 To draft a better patent application by emphasizing those features of
the invention not turned up in the search.
 Duty to Disclose known references which predate your
application to the Patent Office
 However, no affirmative duty to perform a search
 Provide known closely related references with invention disclosure

15. Filing Process
1
Attorney prepares a draft Application
Inventor Reviews & Comments
Application is Finalized
Inventor Reviews & Signs (declaration/POA
and maybe an Assignment)
Application is Filed
Inventor’s Help Sought
In Responding to Office Actions
During Prosecution To Issuance
Foreign Filing?
Invention Disclosure to Attorney
2
3
4
5
6
7
8
Disclosure Conference with Inventors and Attorney

16. Application Process at the Patent Office
Application
Amendments
RCE/Appeals
Examination
Allowance
Office
Action
Issue
Rejection of one or more claimsAllowance of all claims
Amendment of Claims to overcome rejections
Arguments to counter rejections
RCE if the Office Action was “Final” to continue examination
Potential Appeal to the BPAI after a “Final” Office Action if desired
1st
Office Action time can
significantly vary on the
order of 1-5 years
Pay Issue Fees

17. Provisional Patent Application
 A provisional application is a simplified filing whose purpose is to preserve one’s
right to file a utility patent within one year of the filing of the provisional
application
 A provisional application requires the filing only of a specification adequately describing the
invention, and drawings where necessary for the understanding of the invention.
 It is important that a provisional application describe the invention fully, as the provisional filing date
is only effective for subject matter disclosed in the provisional application.
 A provisional application cannot mature into a patent, it is not examined and it cannot claim priority
in an earlier application.
 A provisional application is kept in confidence by the Patent Office. A provisional application is,
however, a regular national filing that starts the Paris Convention priority year (discussed below).
 A provisional application will automatically go abandoned by law one year after filing.
 The provisional application has several important benefits.
 It places domestic applicants on an even footing with foreign applicants because the filing of a
provisional application does not trigger the start of the 20-year patent term.
 It has minimal legal and formal requirements.
 The provisional application provides a mechanism whereby applicants can quickly and relatively
inexpensively establish an early effective filing date in a patent application which establishes a
constructive reduction to practice for any invention described in the provisional application.
 The filing of a provisional application also provides up to twelve months to further develop the
invention, determine marketability, acquire funding or capital, seek licensing or seek manufacturing.

18. Patent Lifecycle and Costs
End of
Patent Term
Invention
Disclosure
Submission
$4-6K
$1.2K
$1.5K
$1.2K
$0.9K*
$0.5K*
$1.3K*
$2.0K*
Patent
Application
Preparation and
Filing
Patent
Application
Prosecution
Patent
Issue
Fee
Patent
Maintenance
Fee
Patent
Maintenance
Fee
Patent
Maintenance
Fee
~$15.0K
Approximate fees
* Small Entity Fees (<500 employees)
~3 yrs. 3½ yrs. 4 yrs. 4 yrs.
20 yrs.

19. IPR Value
Leverage
Discontinued
Products/
Technologies &
Their Value
Utilize
Technologies/
Products in New &
Different Ways for
Incremental
Value
Utilize
Technology/IPR
To Foster
Development
By Others
Help Drive
Adoption Of & Value
From Standards Based
On our
Technology
Help Drive &
Realize Value
From M&A
Activities
Generate
High Margin
Royalty Income
Generate Demand
For Products
Facilitate Deals/
Relationships
With Customers,
Suppliers, Partners
& Others
To ObtainTo Obtain
Business ValueBusiness Value
Support Other
Business
Objectives
Obtain Access/
Rights To
3rd
Party
Technology/IPR
Defend
Against 3rd Party
Claims
(Especially
IPR Claims)
Protect
(Especially Core)
Products &
Technology
Promote
Technology
Leadership
Defense &Defense &
ProtectionProtection
LeadershipLeadership
OtherOther
BusinessBusiness
ValueValue
(via Strategic Licensing)
LicensingLicensing
Income/Income/
ValueValue
* Pure Income
* Savings
* Product Pull-Through
* Business Needs
* Reputation/Leadership
(Licensing Plays The Key Role)(Licensing Plays The Key Role)

20. Patent Value for Small/Mid-size
Companies
Staking claim to key technologies
and product differentiation –
Minefield analogy
OFFENSE DEFENSE
Deterrence against litigation –
Mutually Assured Destruction
Deterrence against one-sided
licensing requirements from
larger companies (e.g., IBM)
Product Protection
Marketing
Litigation/Injunction/Licensing
R&D Investment Insurance
Preventing competitors from
market entry

21. Defensive Aspects of Patents
 Mutual assured destruction (MAD) is a doctrine of military strategy and national
security policy in which a full-scale use of nuclear weapons by two opposing sides
would effectively result in the destruction of both the attacker and the defender.
 Patents are like a nuclear weapon – it only takes infringement of one claim of one
patent to potentially shut down a product
 Using Cold War strategy, the best way to avoid a fight is to have as many weapons in
your arsenal as possible
 Larger patent portfolio avoids licensing requirements from larger companies
 Landmine analogy
 For both existing markets and newly emerging technologies, patents provide coverage
over the technology landscape akin to landmines on the battlefield, the more on the
field, the less likely your opponent will cross the field
 Use Patent prosecution/portfolio in a two prong manner
 Protection against larger competitors
 Staking claim to new technologies, markets, etc.