Using United States utility patents to protect innovation

1. A utility patent protects an invention or idea that is novel, non-obvious, useful and not abstract. For example, a novel artificial intelligence algorithm, a novel communication protocol, a novel biometric device.
2. Utility patents differ from design patents. Design patents (called industrial designs in Canada) protect the "look and feel" of a product, for example the look of the coca-cola bottle, or a Birkenstock sandal.
3. A utility model is similar to a utility patent, but this type of protection is not available in Canada, the United States (US) and the United Kingdom (UK) as well as other countries. The utility model is generally cheaper to obtain and maintain but has a shorter term (from 6 to 15 years), shorter grant lag, and less stringent patentability requirements. However, they are considered to provide a lower protection.
4. For the rest of this fact sheet, the term patent relates to a utility patent.
5. A utility patent is a valuable protection that allows the patent owner to prevent someone from making, using, selling and offering for sale the claimed invention.
6. Utility patent only offer protection in the countries in which they are filed.
7. Anyone can make, use, sell and offer for sale without penalty, an invention in any countries where a patent application has not been applied for.
8. In order to obtain a utility patent, the best mode of the invention must be disclosed along with any embodiments or variations such that someone 'skilled in the art' can reproduce the invention.
9. The details of a utility patent application are disclosed publically worldwide after 18 months of filing and will be granted between 2-5 years after the filing.
10. A utility patent application is reviewed by a patent examiner who will issue one of more office actions with different types of rejections generally relating to prior art that relates to the application. This stage can take a few years and is referred to as patent prosecution. Once the examiner is satisfied with the scope of the claims, the examiner will allow the case to issue as a registered patent.
11. Patents are expensive but can provide valuable protection and licensing revenue. For example, the cost of a US patent can range between $25K-$80US over its 20-year lifetime. This includes drafting, prosecution, issuance and annuities.
12. Patent prosecution is done in parallel in every country where the application is filed. The cost of foreign patents filings also varies and may also require translation fees.
13. Once you file your patent application in the first country, you can wait up to 12 months to select the other countries in which you'd like to file for protection.
14. An alternative to #9 is to file a Patent Cooperation Treaty (PCT) application which allows 30 months before a decision must be made as to which additional countries to invest in protection. The PCT application can be filed at the anniversary of the first filing as well delaying foreign investments by another 18 months (30 months from the date of first filing).
15. There are several programs that help streamlining the patenting process. One program is the Patent Prosecution Highway (PPH). With this program, if a patent issues in one country, the patent owner can indicate the allowance to the examiners in participating countries to accelerate the prosecution phase and obtain an issuance faster and with lower prosecution fees.
16. The US has an interesting program (Track-1) which, for a fee, will accelerate the prosecution process with the goal to reach an allowance within 12 months. With this program, an applicant can use the allowance when deciding what other countries to protect before the foreign filing decisions at the anniversary of the filing.
    
    

    Example 1: A company files a US application on September 1, 2000 under the Track-1 program. The prosecution is accelerated and an allowance is granted in August 2001. Given the US allowance, the company has a much better understanding of the value of the protection achieved and the scope of the claims. They can make enlightened decisions on where to invest for foreign filings. They can also use the PPH program to speed up and significantly cost-reduce the prosecution in all the participating countries.

17. In Canada, the application prosecution can be accelerated if the application relates to a green technology. A first office action will be issued by the Canadian examiner within 3 months and it is possible to have an allowance within a year to use the PPH program in foreign filings, including a US filing.
18. A PCT application never issues as a patent, it is a place holder to delay the foreign filing decisions. However, a search report with relevant prior art is issued after 10-16 months, and if the search report is favourable, it can be used along with a PPH request in participating countries when doing the foreign filing.
    
    

    Example 2: A company files a PCT application on Sept 1, 2000. A favorable search report is issued in October 2000. In March 2003, when the PCT expires, the company can use the search report with the PPH program to speed up and significantly cost-reduce the prosecution in all the participating countries. Note that in this case, there is no US patent granted for another 2-5 years and it is still unclear what the scope of the claims will be after the prosecution and what the value of the patent will be.

Key considerations for Canadian companies:

• It is important for Canadian companies to carefully select countries where the market is sufficiently large enough to warrant the investment. Therefore, in general, Canadian companies will file for patent protection at least in the US and their other main markets.
• Patent litigation is well organized in the US and several firms offer contingency litigation or litigation financing, therefore the US patent will be the easiest to enforce.
• The sequence of filing and the programs used (PCT, Track-1, PPH) have a big impact on the long term cost of a patent portfolio and the strategy should be developed carefully based on the company's stage and objectives.
• Foreign filing strategy is key to building a valuable IP portfolio cost-efficiently.
• According to Natalie Giroux, President at Stratford Intellectual Property, "We have been successful at using the PPH program, with US track-1 prosecution or PCT, to accelerate and cost-reduce prosecution. This program can benefit any Canadian companies trying to protect their inventions in foreign countries."

Additional information:

• For information about IP protection in the US, please see the Canadian Intellectual Property Office's publication on Doing business abroad: Protecting your IP in the United States
• For more material relating to the export of goods to the US, please see the Doing Business in the United States page
• For more information on going global with your IP, visit Canada.ca/export-ip