What do you do when you are in the process of developing an innovation and suddenly come across a competitor's patent? This discovery may have far-reaching consequences for your own invention. In this blog I explain the options available to you when dealing with competitor's rights.
Analysing the patent risk
It is not unusual for this to happen and in my work I frequently encounter situations in which I discover another company's patent rights or a client knocks on my door and says, "I have come across a patent and it appears to be getting in the way of my innovation." When this happens the first thing we do is check the nature of the rights involved. Has the patent already been granted or does it involve a patent application? Is it still valid or has it already expired? And in which countries is it valid? Based on this information, it is easy to assess whether the competitor's patent does indeed pose a risk.
After all, an expired patent generally does not pose a risk. A patent in a country where you do not do any business often does not pose one either. And if it involves a patent application, it may well be the case that the patent that is ultimately granted will be assigned a narrower protection than initially requested. You can only really assess whether there is a risk once you know more about the patent.
Four options
If it turns out that the patent does indeed pose a risk, this does not necessarily mean that you have your back against the wall. However, simply continuing with the development or sale of your product or service is not always the best thing to do. You do have a number of options available to you:
1. A 'design around'; you work around the patent by adapting the innovation.
2. Filing an objection, for example through opposition proceedings.
3. Preparing an objection, but keeping it in reserve and not filing it.
4. Purchasing a licence from the competitor in question.
Design around
This is often a safe option. You then run relatively little risk of your competitor becoming aware of what you are doing. However, it is important that you keep sufficient distance from their patent. If your invention gets too close to your competitor's, you may still be infringing without actually being aware of it. So you should always engage a patent attorney. They have the technical and legal knowledge required to help you with a design around. Sometimes a design around is not advisable or possible.
Filing an objection
You can file an objection through opposition proceedings. This option is a little more complex, as it is an extensive procedure whereby you file objections to, for example, the European Patent Office. You will need to demonstrate that the patent should never have been granted in its current form because the innovation is, for example, not novel or inventive. In many countries you can file an objection within a certain period of time after granting but sometimes you can even do so throughout the entire term of the patent’s validity. In the best case scenario, you will be able to eliminate the competitor’s patent partially or completely.
Objecting will attract the competitor's attention. They will know that you are working on the same thing and may be infringing. One way to get around this is by means of a 'third-party observation' before the patent is granted. This form of objection can be done anonymously.
Preparing an objection
In the case of this option, you prepare but do not file your arguments. You gather arguments and evidence that shows that the patent should never have been granted and/or that shows that you are not infringing the patent. This will not make the patent go away but when the patent holder accuses you of infringing you will be well prepared. This is a good option when you do not want to draw attention to yourself or when you do not want to spend time or money on opposition proceedings.
Taking out a licence
If you are sure that the patent should not have been granted but also do not want to start opposition proceedings then a licence may be the answer. If your arguments make sense, you can try to obtain this licence on favourable terms. You then indicate that you have good objections to the validity of the patent but that you nevertheless want to leave it at that. The competitor will then be more inclined to grant a licence on favourable terms.
A licence is also a good option if the opponent has lots of patents. If you eliminate one or two of these there are often enough left that you may still be infringing on.
OWN patent portfolio
If you have one or more patents yourself this may not provide direct protection against infringing the rights of others but will generally put you in a stronger position. In negotiations, you will create a much more level playing field because both you and the competitor own certain rights. A competitor, who would want to sue you for infringement of patent rights, will act more cautiously because you have patent rights as well. In this situation filing your own patent on your innovations will also put you in a stronger position.
Time-consuming and complex
Welke optie u ook kiest: voor allemaal geldt dat u goede argumenten moet hebben. Argumenten die aantonen dat of het octrooi onterecht is verleend of die aantonen dat u geen inbreuk maakt. Het inschatten van het risico en verzamelen van argumenten is tijdrovend en complex. Loop dus daarbij geen risico en schakel een octrooigemachtigde in.
If you contact me, I will be happy to help you think about how to deal with your competitor's patents.
