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The Benefits of Use of "Patent Pending"
This notification can take the form of a "patent pending" notice applied to a product or product packaging and is often effective as a marketing tool directed towards potential investors and consumers and as a way to deter competitors.
Patenting your invention is often an important step in commercializing it. However, as it is your granted patent and not your patent application which is enforceable through the courts, and it can take 20 months for a patent application to be examined in Canada, the use of a patent pending notice is a way to benefit from your filed application while it undergoes examination.
Reasons for Using a Patent Pending Notice
There are at least three reasons to notify the public that you have applied for a patent. Notification can be used as a marketing tool to indicate that your product is inventive, it can be used as a marketing tool to indicate that your company is innovative, and it can be used to deter potential competitors.
Indicating a New and Inventive Product
A patent pending notice can often be used as a marketing tool, directed at both potential investors and potential consumers, indicating that your product is inventive. A patent pending notice is often an effective way to tell potential consumers and investors that you consider some aspect or feature of your product inventive and important enough to invest in a patent to protect that aspect or feature. This can increase consumer engagement with your product, and potentially lead to greater sales performance. It can also incentivize investors to consider investing in your product, not only because it may be inventive, but because you have taken the first steps required to protect your investment and their own, and because they will likely be unable to get the same opportunity from anyone else. For these reasons, “Do you have a patent?” is often one of the first questions asked by investors. Note, however, patent pending should be use in association with products as described and claimed in your patent application.
Indicating an Innovative Company
A patent pending notice can also often be used as a marketing tool on a broader level, to indicate that you or your company are innovative. The notice associates your brand or company with inventiveness and innovation and tells potential consumers and inventors that you are serious about investing in new technologies and in protecting your inventions.
Deterring Potential Competitors
If your product has been introduced to the commercial market and is doing well, there is a chance that others may attempt to copy it to share in the profits. "Patent pending" sends a signal to these competitors that an essential aspect of your product may soon be legally protected by an enforceable patent and such competitors risk facing a patent infringement lawsuit.
Where products are not labelled "patent pending" there may be no reason for a potential competitor to think anyone will object to copying. Notifying potential competitors that you are seeking a patent may convince them that the benefits of copying are not worth the risk of a substantial damages award in the aftermath of costly legal proceedings. Such a notification indicates that you are interested and invested in protecting your intellectual property, and willing to take further steps to do so. As such, marking your product "patent pending" can serve as a deterrent to copying by potential competitors.
Although you are not able to enforce a patent application through the courts until it has been granted, after it is granted the Canadian Patent Act allows you to seek reasonable compensation for infringements that occurred in the period between when your patent application was published and when your application was granted. Typically, most applications are published 18 months after the earliest priority date or filing date. The courts have held “reasonable compensation” to mean a reasonable royalty, meaning the award is likely to reflect whatever compensation might have been negotiated if the infringer and the patent owner had negotiated a licence. A patent pending notice lets potential competitors know that they could be liable for such damages if they proceed to copy your invention, even though it is not yet patented. It is important to keep in mind, however, that evidence of harm suffered by the patent owner is required, and applicants should therefore keep any relevant records. Further, the patent owner is only entitled to compensation if the claims in the granted patent are essentially identical to those in the published patent application. Other factors that may affect the determination of compensation to the patent pending holder include the relevant time period covered by reasonable compensation, whether or not the pre-grant published claims were subsequently invalid or amended, and whether there were periods of where the patent application was abandoned.
You can further enhance these deterrent effects by seeking early publication of your patent application and by seeking expedited examination of your application. Early publication will trigger sooner the period during which any action which would infringe the later-issued patent is compensable following its grant, as set out above. Expedited examination, on the other hand, fast-tracks your application so that you have a legally enforceable patent as soon as possible. For reference, whereas patent applications are normally examined within 20 months of filing, applications that have been expedited are examined within 3 months. An application may be expedited on the basis that it is related to green technology of environmental importance, that substantially the same set of claims has been found allowable in certain other jurisdictions (i.e., if you have a corresponding patent application with one or more of Canada’s Patent Prosecution Highway (PPH) partners) , that it claims an invention related to medical products and processes supporting the response to COVID-19, or that examination according to the usual timeline could prejudice the applicant. Fees apply in some cases.
Conclusion
Notifying the public of your patent application has many benefits. While it is important to balance benefits against potential risks, including the risk that the notice will motivate a competitor to design around your claimed invention, notification often allows a patent applicant to maximize the benefits of a well-drafted patent application.
If you would like to discuss whether applying for a patent is right for you or your business, contact us now for a complimentary and confidential initial telephone appointment with a member of our team.
