PATENTS AND THE ORCHID BUSINESS
By BOB HUNTER, Ph. D., Registered Patent Agent, WebPatent.com
What is Intellectual Property?
o An intangible product of the intellect
o Free for anyone to use unless protected
o Must be placed in a “vessel”
o Can be sold, rented, licensed, etc.
Intellectual property is an idea, property that comes out of your head, creations of your intellect. Anybody can use your ideas unless you protect them.
Types of Intellectual Property
o Types of patents: Utility (technology), Design, Plant
o Plant variety
o Trade secret
o Trademark/service mark
o Trade dress
Three different kinds of patents (utility, design and plant) might be useful to you as an orchid grower. You might also find a plant variety certificate useful. A trade secret is any information that you have that provides you a commercial advantage that someone would have to break the law to obtain. Copyright is a way of preventing others from copying a work of authorship. A wide variety of things, from sculptures to books, can be protected with a copyright. Trademarks and service marks are symbols that are associated with either a product or a service that no one else can associate with that service or product except you. Trade dress is a way that you present your product to the market. A lot of patented products, e.g., drugs, are sold under a patent. But even after that patent goes away, no one can adopt that trade dress - the package that it was sold in - even though the patent owner has lost the patent protection.
o Types: a. -Design, b. -Plant, c. -Utility
o Reasons to patent: -Valuable, -Long economic life, -Enforceable, -FUD (Fear, Uncertainty and Doubt)
All three types of patents have similar general characteristics, and each has specific characteristics that I will talk about in detail. Some types of patents can be a significant investment of money up front. You need a good reason to have that kind of patent. It has to be something valuable with a long economic life because you want to get this investment back. You have to strategize about how you are going to enforce the patents because that is the most expensive part of a patent. And then, there is the reason why firms like Microsoft get patents, i.e., to create fear, uncertainty and doubt in the marketplace. While you have a patent pending, no one else can know what you might have a patent on because the patent application process is confidential. No one knows how much control of that particular kind of idea you might have. Fear, uncertainty and doubt works very well when an independent inventor is dealing with large corporations because they want to avoid getting sued for patent infringement. They know how much it costs them.
Patent Owner Can Prevent
o Making, using or selling a claimed invention in the U.S.
o Actively inducing another to infringe in the U.S.
o Selling an important part of a claimed invention in the U.S.
o Supplying an important part of a claimed invention for assembly outside of the U.S.
o Importing into the U.S. a product made by a process that is patented in the U.S.
These kinds of protection apply to all kinds of patents. Patents are granted by jurisdiction. There are some regional patenting bodies for Europe but generally you have a patent in an individual country.
o Criterion is “first to invent”
-Thinking up operable invention in U.S.
-Must be able to prove when
o Reduction to practice
-Build and test invention OR file patent application in U.S.
-Must be able to prove diligence
One of the unique characteristics about the U.S. is that here you really have to earn inventorship by playing the game in accordance with the rules. Here, it is the first to invent who can earn a patent. It is not the first person to file a patent application, which is the way that every other country except the U.S. and the Philippines does it. It is really the first person to have conceived an idea and is diligent in reducing that idea into practice, i.e., making and testing a real version of it or filing a patent application on it. The two important things that you need to get a patent on something are that first, you have to conceive of the concept, think it up. That has to be done in the U.S., or the idea has to be brought into the U.S. in order to win a priority contest. You must be able to prove when that happened. Second, you must show that you were diligent, in however that term is defined in your industry, in either building and testing the invention or filing a patent application.
Bars to Patentability
o Lack of novelty
-Published or patented anywhere in the world before invention by applicant
-Offered for sale (even in secret) or used in public in the U.S. more than 12 months before filing (except as an experiment)
-Differences between prior art and claimed invention would have been obvious to a person having ordinary skill in the art.
There are also a lot of ways in which you can lose the right to obtain a patent on your invention. One way to have trouble in obtaining a patent is for a description of “how to use” and “how to use” the invention to be published or patented anywhere in the world before you invented it here. If the invention (or the plant) is offered for sale even in secret (the sale does not have to go through but there has to be a commercial offer for sale) or used in public in a way that is uncontrolled by you more than 12 months before you file a patent application here in the U.S., you can lose the ability to patent it. Except if the sale or public use is part of an experiment, i.e., you’re trying to find out if the invention is useful and meets its objectives. But if it is an experiment, you must treat it as one. The other problem you can face is obviousness. If the invention is obvious to a person having ordinary skill in your field, you are not going to obtain a patent on it. So, invention goes beyond mere engineering or a good design. It is that extra step that is invention, that creative step of solving a problem in a new way.
o Shape or surface ornamentation of an article of manufacture
o Protects the way the article looks
o Application includes a drawing of the article and a single claim in a specific form
o Must be ornamental, novel, non-obvious
o Example: shape of a new package
o Term: 14 years from date of grant
Design patents protect the shape or surface ornamentation of an article of manufacture; not how it works, just what it looks like. The application is very simple, just a drawing or several drawings of the article from different perspectives so you get a handle on what the whole thing looks like. The design must be ornamental. It has to be novel and it has to be nonobvious. Examples would be the shape of a package or the surface ornamentation on a package. The term is 14 years from the date of grant. It is relatively inexpensive to obtain a design patent. But they are not very strong because if someone changes your design enough so that it does not confuse the customers in the marketplace, they can get around your patent. You can protect that same thing with a copyright for $30, unless you want the characteristics that a patent gives you.
o Plants propagated asexually, e.g., by rooting, layering, budding, grafting, etc.
o Includes cultivated sports, mutants, hybrids, and newly found seedlings
o Excludes tuber propagated plants or plants found in an uncultivated state
o Inventor(s) must have asexually reproduced the plant to establish reproducibility
o Claimed invention must be a distinct and new variety of plant, not just a flower or a fruit
o Term - 20 years from date of filing
Plant patents are used to protect plants that are propagated asexually. If the plant is capable of sexual propagation, that is fine, but the plant also has to be capable of asexual reproduction. It can include cultivated species, mutants, and newly found seedlings, but it excludes plants found in uncultivated state. That is important. If the plant is found in an uncultivated state, you cannot obtain a plant patent on it. The reason is that products of nature are unpatentable. Man has to have intervened in nature to do it. And the Congress in its wisdom said, if you found it in a cultivated area, man cultivated in the area, so there was some effect on the plant, so it is patentable, but you cannot go to a rainforest some place, pull one out and obtain a plant patent on it. You can get another kind of patent on it; I will talk about that later. The inventor must have asexually reproduced the plant so that there is some proof that the plant is asexually reproducible. The plant must be a distinct, and a new variety of a plant. You cannot obtain a patent on a flower or another piece of a plant. It must be the entire plant. The term is 20 years from the date of filing.
Plant Patent Owner Can Prevent
o Asexual reproduction of the claimed plant in the U.S.
o Using, offering for sale or selling all or part of the claimed plant in the U.S.
o Importing all or part of the claimed plant into the U.S.
This is in addition to the rights that we talked about earlier that all patent owners have. Before 1995, these were the only rights that a plant patent would give you. In 1995, Congress changed the rules of the game. There have not been any court cases to determine what the new law really means. At a minimum, however, you can prevent people from asexually reproducing claimed plants in the U.S. using, offering for sale, selling all or part of the plant in the U.S. and you can stop them at the border from bringing that plant into the U.S. In order to actually enforce a plant patent, you must have evidence that the infringing plant your plant. It cannot just be a similar plant. It cannot just look like your plant, it truly has to be a clone of your plant, and that is the significant limitation of plant patents. What you can protect is limited to clones.
Plant Patent Application Content
o Characteristics that distinguish the plant from related known varieties, including colors of plant structures, if distinctive
o Where and in what manner the plant was asexually reproduced
o Location and character of area in which a newly found plant was found
o A single claim in a specific form
o Two copies of color drawings or photographs
o Declaration by inventor(s)
o Can be filed as a provisional application
A plant patent application is very straightforward. The main problem is coming up with a biological characterization of the plant - the shape of its pieces and the color of its parts. That is what makes it a distinct kind of plant. You have to use color charts like the Royal Horticultural Society color charts. With such charts, under a certain light, you look through the hole in the card that has a certain color, and characterize the color of the flower and other parts of the plant that make it distinct. You have to tell where and the date on which the plant was asexually reproduced. Remember, I said that the inventor has to have accomplished that task. The key point here is to make sure the inventor has supervised, at least one instance of asexual reproduction. If somebody else does it independently, that does not count. Remember, it has to be found in a cultivated area if you found the plant. A plant patent contains a single claim because you are claiming the entire plant. Two copies of color drawings or photographs are needed. I am sending around a declaration form - it is a one or two page form that you fill out depending on how many inventors were involved. You can even file a plant patent application as a provisional application at a lower cost. Obtaining a plant patent application can cost you the U.S. Patent and Trademark Office fees of a low hundreds of dollars to file, and it costs you in the high hundreds of dollars to get it to issue as a patent. You do not have to hire a patent practitioner, but if you do you will probably have to hire one by the hour. If you do the work, i.e., you do all the biological characterization, all the patent practitioner has to do is put it in the right form and in fact, if you type it up using Microsoft Word, it might only cost you $600 to pay the practitioner to do the actual patent application process. There is a prosecution process where the Patent Office, once the patent application goes in, checks their databases to make sure there is not some similar plant out there. If there is, then a battle will go on. But if your plant is distinct, then the application just goes to issue.
Plant Patent Application Format
o Cross Reference to Related Applications
o Statement Regarding Federally Sponsored R & D
o Latin Name of Genus and Species
o Variety Denomination
o Background of the Invention
o Brief Summary of the Invention
o Brief Description of the Drawing(s)
o Detailed Botanical Description
o Abstract of the Disclosure
These are the recommended sections in the plant patent application. It is not complicated, compared to other kinds of patents. A title is needed as is a cross reference to any related applications (i.e., if you have any other applications that you filed that these add to, you have to put that in). You must supply the Latin name of the genus and species, a variety name, which is required by a treaty that the U.S. has signed, that is a unique name for the variety, a little discussion of the genus, and a brief summary of the invention. You highlight how it is distinctive from other similar plants, and point out particular characteristics. A brief description of the drawings are most often in the form of color photographs, so you say, “Figure 1 is a color photograph of the entire plant, Figure 2 is a color photograph of the flower, etc.” The hard part is the detailed botanical description. That is where you characterize all the pieces of the plant so that the Patent Examiner working for the Patent Office can make sure that this is different from other plants. If you look at the examples I have passed around, you can see that they all have a similar format for similar types of plants; it is almost fill in the blanks. It does not involve figuring out how to claim this invention. In this situation, the claims all have the same words in them except the name of the plant. Finally, there is an abstract which is a summary of what is in the application. So plant patents and applications are not complex documents. You just need someone who can characterize the plant and write clear English.
Utility (Technology) Patent
o Subject matter
-“Anything under the sun that is made by Man”
-Articles of manufacture, machines, compositions of matter, processes
-Useful, novel and nonobvious
-20 years from date of filing
The other kind of patent is a utility patent or a technology patent. On December 10th of last year, the U.S. Supreme Court decided that this kind of patent also applies to plants. The U.S. Patent and Trade Mark Office for 60 years had been issuing utility patents on plants, but it was controversial until a case went to the Supreme Court and they nailed it down. You do not have to argue that issue any more. You can get a utility patent on anything under the sun, made by man, or that mankind intervened in nature to make. These can be articles of manufacture, machines, compositions of matter, mixtures of things, microorganisms, or processes, ways of doing things, new ways of accomplishing a valuable result. The criteria here are: has to have some utility, i.e., be useful; it has to be novel; it has to be nonobvious. The term is 20 years from the date of the patent application. You see, these are really long-term things. It’s a good idea not to do this unless you expect income over a long enough period of time to get back your investment.
Examples of Patentable Technologies
o Mechanical, electrical, optical devices
o Genetically-engineered non-humans
o Isolated microbial cultures, DNA, RNA
o Plants, plant parts and seeds
o Ways of making or operating things
o Business methods
o Software systems, processes, interfaces
You can get a utility patent on a flower, seed or leaf, or any piece of a plant, genetically engineered non-humans, ways of making or operating things, new ways of hybridizing or new ways of running a business, etc.
Types of Utility Patent Applications
o Provisional U.S. patent application
o -Asserts priority of invention internationally
o Regular U.S. patent application
o -Contains claims; is examined; can issue
o International (PCT) patent application
o -Does not issue as a patent
o Regional patent application (e.g., European Patent Office)
o Non-U.S. patent application
There are different types of utility patent applications. They cost different amounts of money and they give you different amounts of protection. A provisional U.S. patent application just puts your foot in the door in the Patent Office, on an international basis, for a 12-month period. For provisional patent applications, the filing fee is $80. You can do it yourself if you want to. My website, webpatent.com has information on how. I want to get as many people as possible that want to write their own patent applications to do it because there is too much work out there. Usually, for a mechanical invention this can be prepared by a patent practitioner for a thousand or two thousand dollars. At the end of that 12-month period that started when you filed your provisional, you have to file all the other patent applications that you want in order to protect your invention. A plant application can be filed as a provisional patent application, so if you want to put off the pain of having to pay the Patent Office $250 for a year, you can pay them $80 instead. And it gives you one more year of patent pending status instead. A regular U.S. patent application contains these things called patent claims. They are very stylized legal patent descriptions of the invention that are at the end of the patent. They are the heart of a utility patent, specifying the boundaries of what your intellectual property is. That is what you pay practitioners for because it is really an art to come up with patent claims that grab as much intellectual property as possible for the client but do not “step on” anybody else’s intellectual property. If you want to get international protection, you can file an international patent cooperation treaty (PCT) application during that 12-month period. That will put your foot in the door of the Patent Office of just about every industrialized country for up to 30 months from the date that you filed the first patent application. You must be very sure there is a really good market outside the U.S. because it really starts costing you money. It can easily cost you $6,000 or $7,000, primarily paying fees to the World Intellectual Property Organization to file an international application. This puts off the pain of filing in every country where you want to be able to stop someone from selling your invention. It can easily cost $5,000 per country if you do not need an Asian country translation. It can easily cost $15,000 for those countries. So you do not want to do this unless you have a great market outside the U.S. But look at their legal systems: would you want to sit in a courtroom over there and try to enforce a patent? You can go to one place for regional patent applications, like European Patent Office, and get a patent on all the European community countries. You have to think strategy, understanding what you can do to enforce the patent. Sometimes you have to pick out countries. If you can stop, e.g., anyone from making, selling, and using your invention in Germany, which is a pretty big junk of Europe, it may be that with certain kinds of inventions, that is enough to prevent anybody from trying to compete with you.
Utility Patent Application
o All types of applications
-Written description of invention
-Drawings, if required for understanding invention
-How to make and how to use the invention
-Deposit of biological material, if required to practice the invention
-Best way of practicing invention
o Regular applications (only)
-Arguments for patentability
-Information material to patentability determination
-Declaration by inventor(s)
A utility patent application contains a written description of the invention, and drawings so somebody can understand it. The real tough part is how to make and how to use the invention. You have not invented anything unless you are able to teach someone with ordinary skill and knowledge about all inventions that have ever been invented in that field “how to make” and “how to use” the invention. A unique part of utility patent applications is that, if you would need a culture of the plant or microorganism in order to practice the invention, you have to put some biological material that can reproduce itself in a culture collection, or small plants, or whatever. In other words, you must give to society everything society would need to practice the invention. If you are in the U.S. you have to disclose the best way to practice the invention. It is not fair to give them the second best way to do it and you want to control the best way. Regular applications only have subtle arguments where you “badmouth” what went before and differentiate, in the Examiner’s mind, your invention from what went before. This is an adversarial process between you and society. Society is going to give you a monopoly for 20 years and they do not give it to you easily. They want to make sure that this invention meets the criteria for patentability. You have to give the Patent Office all pertinent information. If there is something you know about the “best mode” of practicing your invention and you do not provide the information, you can get a patent but I will tell you, a private investigator will find out what that thing is and invalidate your patent, if you ever try to enforce it.
o Sexually reproduced (by seed) and tuber propagated plant varieties
o Variety must be new, distinct, uniform and stable
o Variety may be represented by seed, transplants, plants, tubers, tissue culture plantlets or other matter
o Term: 20 years from date of issue of certificate, 25 years for a tree or vine
Another way to protect plants that reproduce true via seed is by Plant Variety certification. This program is not run by the patent office; it is run by the U.S. Department of Agriculture. It can be used to protect sexually-reproduced plant and tuber-propagated plant varieties. The plant must be a new variety, distinctive, uniform and stable over time. You deposit seeds in order to get this sort of protection. Those seeds will have to be true over time. The variety can be one that is also asexually reproduced but this way of protecting it just protects the sexual reproduction end of it. The term is 20 years from the date of issue.
Variety Owner Can Prevent
o Selling or marketing of the protected variety
o Importation of the variety into, or exportation from, the U.S.
o Sexual multiplication or propagation of the variety as a step in marketing
o Use of the variety in producing (as distinguished from developing) a hybrid or different variety
o Dispensing the variety without notice that the variety is protected.
A variety owner can prevent selling or marketing of the protected variety, and import or export out of the U.S. and sexual multiplication or propagation. No one can use your seed in producing a hybrid, but they can use the seed in developing a hybrid. But if the hybrid is very closely related to the plant that you have a variety certification on, they have to license it from you in order to sell it.
o Products of the intellect can be protected in only one way - by converting them into intellectual property
o Intellectual property is often the most valuable asset a company can own
o Protect your intellectual property so that you (and only you) can profit from it.
There is only one way to play this game if you want to make money from intellectual property, and that is to choose one or more appropriate vessels that governments have come up with. Put your idea in that vessel, and then you have ownership rights over it and can use the courts to prevent others from “stepping on” your property rights. In a lot of industries, intellectual property is by far the bulk of the value of the company. If you take Microsoft, and add up the value of all the buildings and desks and computers they have, it ends up being 1/15th of what you and I would pay for a share of Microsoft stock. It is their trade secrets, the knowledge in their patents, the knowledge that the people have in their heads that is what makes the company so valuable. So you can make money from intellectual property, but only if you protect it and only if you can prevent others from profiting from your work. So that is a general overview of how to protect plants with patents and other techniques. I am available to you for the rest of the day for discussion. By law, anything you tell me in private I must keep that way.
Q. What is a “right to use” search and how much would it cost?
A. That is research to find if someone else already has a patent. You could use key words, specifying the distinct characteristics of the plant and search through the 12,000 U.S. plant patents out there. Most patent searches cost from low to high hundreds of dollars. You need to know if someone else has a patent on something you have or similar to it, so as not to infringe on other people’s intellectual property rights. Patents give you the right to prevent others from using the patented invention. They do not give you a right to practice it. If you want to be protected from paying triple damages should you be found for patent infringement, you need an opinion from a patent attorney, stating he has reviewed the results of the search and states “I don’t think you are infringing on anyone else’s patents”. Keep that in your file.
Q. Can you differentiate “producing” from “developing” a hybrid?
A. “Producing” is growing some of it to sell and “developing” is using the genetic material to come up with a new plant. Under the Plant Variety Protection Act, you can use those materials to make new plants, but if it is close to original plant, you will have to pay for a license to use it. That is a recent change in the law. There used to be no controls at all about using the seeds to develop a new hybrid. Except, a farmer who grows plants and makes seed from a seed with Variety Certificate is allowed to use those seeds the following year, but he cannot sell the seeds or market them. He can use those seeds on his own farm over and over again. But with a Utility Patent on a seed, there is no way that you can use the seeds to make more seed, sell and you cannot even use any part of the plant. There is a higher cost to obtain a utility patent and to enforce it. A utility patent gives you very strong patent albeit at higher cost, not only to obtain the patent but to enforce it.
Q. How do you stop people from infringing on your patent?
A. You can take that person to court and get reasonable damages, or you can get him to stop and pay you the profits he made during that time, or if he had knowledge of your invention, i.e., he had notice of the plant patent out there, you can get triple damage. If you want to get damages historically, you need to have notice of patent on the product. You can get damages from whenever the person received notice that he was infringing your patent. That is from whenever a reasonable person would know that he was “ripping someone off,” that is the point at which you can begin to collect damages.
Q. Did I understand that Patent Pending is a good protection?
A. Yes, it’s a very good protection. It iss the fear, uncertainty and doubt that is creates. With a utility patent, say a person invented a carburetor, the patent could be written to include not only the carburetor, but also the car. Your claim could be not only on the carburetor, but also on the whole car. It is also a good idea to put “Patent Pending” on your product, but be sure you can remove the notice when a patent is no longer pending on the product. If you decide to drop the application process later, do not have it on so permanently that you cannot take it off because the penalty is $500 per item on each sold and anyone can sue to collect the money. Do not etch it on the product itself, just put it on the packaging. As far as the 12-month period, you must file your patent by the 12-month grace period. The U.S. is the only country where you have a 12-month grace period. This time can be useful to see if there is interest, or you may find a major manufacturer who would buy a license from you and may even pay for the patent application.
Q. A patent can stop the product at the border from coming into the U.S.?
A. Yes, you can stop it at the border. It is a matter of strategizing what’s the least expensive way to enforce it - where and how. If you write the claim correctly you can multiply many fold how you can enforce your patent.
Q. How do you stop infringement - say you challenge a company.
A. Say a big company is selling your plant nationwide and making millions of dollars a month. So think strategically. There are law firms that will sue on contingency basis for 35-70% of the money. They will sue the company to enforce the patent in the U.S. and collect the money, then give you your share.
Plant Protection Websites
o Patent searching - expect surprises
o Protecting plant intellectual property
o Obtaining government grants for R&D