Chapter 24

Intellectual Property:
Patents
 Why Do Businesses Need
Intellectual Property?
 Differentiate from competitors: being unique is
valuable.
 Defend against competitors: successful companies get
attacked.
 Prevent creation of competitors: successful companies
get copied.
 Raise $: investors want to know their investment is safe.
 Marketing: consumers crave what they consider special
products and services.
 Commercials
 Product sheets
 Hiring 2
 Patents

 The importance of granting monopolies for new

inventions has been recognized in the United States
since the adoption of the U.S. Constitution. In Article
I, section 8, the U.S. Constitution:
 Congress shall have power . . . 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.
 A Patent…

 Is a legal right to prevent others from:

 Making
 Using
 Selling/offering to sell
 Importing
 Does not give its owner right to make, use, sell, offer to
sell, or import
 Does not (directly) protect products or services

4
 Patentable Subject Matter in the U.S.

1.
 Statutory Basis:
35 U.S.C. § 101
A patent can be obtained for “any new and useful process,
machine, manufacture, or composition of matter, or any new
and useful improvement thereof…”

5
 Types of Patents
 Utility Patents
 Machines
 Articles of manufacture
 Methods
 Compositions of matter
 Design Patents
 Protect ornamental appearance of article
 Plant Patents
 Asexually reproduced plants

6
Utility Patent V. Design Patent

 Design patents protect the appearance, not the function

of an item
 Last 14 years from the date of issuance

 Utility patents protect the function of the invention and last

20 years from the date of filing. Over 90% of issued
patents are utility patents.
Apple v. Samsung Design Patent
Litigation
 Where Should You File?

 Evaluate your value chain.

 Where are the competitors?
 Where are the markets?
 Where are the manufacturers?
 Foreign filing is expensive, so be strategic!

9
Patent Process – “Prosecution”

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MONTHS ~1.5-2 YEARS ~1-2 YEARS MONTHS

10
 Patent: A Legal Document
Issue
date
Title

Inventor’s
names

Serial
number

Abstract
Filing
date
Requirements for a Utility Patent

 To receive a utility patent, the new invention must be:

 Novel (new): the invention can not already be patented, in
public use or in a printed publication.

 Nonobvious-not an obvious invention to someone of

ordinary skill in the art/invention.

 Useful: the invention must do something.

 Patents on Living Organisms

 You can patent genetically-engineered bacteria or other

organisms as long as they are not otherwise naturally-
occurring. Diamond v. Chakrabarty (1980).

 However, in Association for Molecular Pathology v.

Myriad Genetics, the Supreme Court ruled differently.
 Synthesized DNA could be patented.
 Association for Molecular
Pathology v. Myriad Genetics, Inc.
 Facts:

 Issue:

 Decision: