Fees and Procedures for the Patent Process
Updated Nov. 14, 2011
The first question to consider is whether the invention will produce a return on
the investment. The invention may constitute a significant advancement in
science, a unique solution to an age-old problem or may even create an entirely
new technology. However, experienced clients understand that patenting a
new invention is a means to an end.
Every year, thousands of unprofitable businesses are launched on the premise
that the patent alone brings all the value to the equation. This is not
always the case. So, what does the patent actually provide in value?
Ultimately, the patent provides a barrier to competition. This means
stopping your competition from using the claimed technology, either by threat or
actual litigation. However, this barrier to competition can be immensely
profitable. Rather than competing on thin margins, "must-have" technology
can command a premium while competitors are kept at bay. In any good
business plan, patents are only part of the total equation.
In the investment arena, patents are often far more critical. New
technologies often require a substantial initial capital investment to deliver
the technology. Investors are often hesitant to put money into an endeavor
if competitors can closely watch the progress of the business model then jump in
with copy-cat products if the market embraces the technology.
Prior to initiating the patent process, a patent search is generally performed.
While there is no legal requirement to conduct a patent search provides a number
Is the invention patentable? This question is really misleading.
Experienced patent attorneys can obtain a patent on virtually any disclosure by
adding enough limitations to the claims. While the patent will issue, the
extremely limited coverage of the patent makes it easy to avoid infringement.
The better inquiry is whether a patent can be obtained that will prevent
competitors from practicing the embodiment of the invention the public wants to
buy. From an economic standard, getting the results and opinion on the
search is valuable. If the patent protection sought cannot be reasonably
obtained, then the cost of filing, prosecuting and issuing the patent can be
Drafting optimum claims. The patent search is a substantial aid to
the patent attorney. Knowing the prior art (already published patents and
literature) an attorney can draft claims which push the envelope - seeking no
less or no more than what the inventor is entitled to. The resultant
benefit is two-fold. First, the quality of the resultant patent will
generally be higher. Second, the costs and time in obtaining the patent
Infringement avoidance. The patent search often retrieves patents
that might be infringed if the client makes, uses, offers to sell or imports the
There are numerous types and levels of searching as provided below:
Searching for interest is generally done by the inventor or company. There
is a perceived need in the market place for a technology but none can be found.
Frequently, companies that are unable to locate a solution for a particular
problem invent the solution themselves.
The knockout search is generally performed through various online search tools
such as the U.S. Patent and
Trademark Office's (USPTO) website or the private subscription-based
searches are generally appropriate when the attorney or client are concerned
that the technology may have already been patented in substantially the same
form. Knockout searches are typically performed on an ad-hoc basis or
during an initial consultation.
A full patentability search is conducted by interviewing patent examiners at the
USPTO in Alexandria, Virginia. With the assistance of examiners, the
searches determine the classification of the invention. Patents are
categorized by thousands of classifications. The advantage of searching by
classification is that they are independent of various lexicons. For
example, one patent may call a critical structure a "pole" while the exact same
structure in another patent may reference it as an "elongated member having a
conduit disposed through the longitudinal axis." Searching takes about two
to three weeks. The resultant opinion that interprets the search results
takes at least another week. Common costs are as follows:
Search on relatively non-complex technology: $1,800
Search on technology of average complexity: $2,400
Search on relatively non-complex software or
Search on relatively complex software or biotechnology: $3,600
International search / litigation search with >= $1 million at risk: $10,000
Once the search is completed, an estimate is provided for drafting and filing
the patent application.
Based the results of the patentability search and opinion, the client makes a
decision whether to proceed with the patent application process. An
estimate is provided for preparing the patent application. Typical patent
application budgets are as follows:
Relatively simple mechanical patent application:
Relatively complex mechanical patent application:
Relatively simple software patent application:
Relatively complex software patent application:
There are no hourly charges for telephone calls, legal drafting, meetings,
research, or the like. The steps are:
ESTIMATE: A written estimate is provided for preparing and filing the
application. This will include the legal fee, the anticipated government
filing fees and potential draftsman fees. Here is what is variable about
50% RETAINER: Prior to initiating the patent application draft, a 50%
non-refundable retainer of the estimated amount is provided. No work is
initiated on the patent application until this retainer is received and placed
in trust for the client. Once retainer is received, the work is initiated
and the client approves the proposed draft of the patent application, the
balance of the fees become due.
BALANCE OF FILING FEE: Upon approval of the final draft of the
patent application, the balance of the legal fee (the remaining 50%) is due
along with the government filing fee and the draftsman's fees. In computer
software applications and business method patents, there are typically no
draftsman's fees since the attorney prepares the block-diagrams. However,
in mechanical apparatus cases, a professional draftsman is required to render
the appropriate drawings that illustrate the claimed invention. The
draftsman's fees are billed at the cost incurred by the firm and there is no
markup applied or passed onto the client.
FILING OF APPLICATION: Once all funds are received, the application
is formatted and electronically transmitted to the USPTO. Less than 2% of
all applications are filed by this method which confirms receipt of the
application, validates that it contains all the proper sections and issues an
official serial number within seconds. Law firms cannot advance filing
fees and thus we cannot file the application without full payment of the
government fees, draftsman's fees and legal fees. To expedite the payment
process, our office accepts checks, wire transfers and all major credit cards.
In the event that payment cannot be made, even if set against a deadline, our
office cannot file the patent application. Accordingly, it makes good
sense for a company to inform its accounting department that funds will be
required for this time-sensitive matter.
Optional Legal Work
Assignment: An assignment of rights in patent application from the
inventors to a company or individual and recording the assignment with the
USPTO. $240 legal fee and $40 government fee.
Petition to Accelerate: Special petitions that accelerate the
pendency of the patent application. $5,600 legal and a
$130 government fee (sometimes there is no government fee in special cases).
Foreign Filing: Filing the application in foreign countries can be
extremely expensive. Please discuss this option with us.
Once the application is filed, it is placed in the substantial backlog that has
been a fixture of the USPTO for decades. The Applicant anxiously awaits
for a response from the patent examiner. Currently, the USPTO allocates 14
months for the patent examiner to issue the first "office action" in the case.
If the examiner takes longer than 14 months, then the term of the resultant
patent may be extended to make up for the delay. In the vast majority
of cases, the examiner rejects all or most of the patent application claims.
Patent attorneys and experienced inventors expect this to happen. It would
be quite easy to write a patent application that "sailed through" the USPTO.
However, it would likely seek less protection that which the inventor is
entitled to. The two main types of rejections are provided below:
To overcome these rejections requires a detailed analysis of each prior art
reference (typically an already issued patent). Frequently, the original
patent application is amended to overcome the rejections and more clearly
distinguish the invention over the prior art. Typical charges for
amendments are as follows:
Relatively simple office action response: $1,200
Office action response of moderate complexity: $2,400
Highly involved and complex response: $3,600
Highly complex response and personal interview in Alexandria, VA: $4,800
The amendment or response is usually sufficient to overcome the rejection and
cause the patent examiner to approve the patent application. However, in
many cases the patent examiner maintains his or her position on the rejection
and issues a final office action. Alternatively, the patent examiner may
issue another rejection based on different prior art.
The office actions generated by patent examiners at the USPTO are the greatest
unknown in estimating costs for the patent process. There are thousands of
different patent examiners and each one may handle a patent application in a
different way. Should a final rejection be received, a number of options
are available to the patent applicant:
After a final rejection is received, the applicant may (within two months) amend
the application a last time to receive an "Advisory Action."
Alternatively, the entire patent prosecution can be "restarted" to allow for
additional arguments by filing a Request for Continued Examination (RCE) along
with the next amendment or response. This incurs the typical legal cost
for an amendment in addition to the government filing fee for a patent
application (currently between $465 and $930 depending on the size of the
A continuation in part application (CIP) includes new subject
matter that distinguishes the invention from the prior art. The CIP, like
the RCE incurs the government filing fee. However, the CIP is filed as a
brand new patent application.
Finally, an appeal may be filed to the Board
of Patent Appeals and Interferences. Under USPTO procedure, once an appeal
has been filed, the patent examiner is required to conduct a conference with his
or her supervisors. It is not uncommon that the conference results in the
patent examiner withdrawing the final rejection and allowing the patent
application. However, if the patent examiner maintains his or her
position, the appeals process typically takes about 18 months.
Once the patent examiner determines the patent application is acceptable, he or
she issues a "Notice of Allowance." Upon receipt of the allowance, the
issue fee and possibly the publication fee is due. The issue fee is
currently $870 or $1,740 depending on the size of the company. In
addition, a publication fee of $300 is due if the application was published.
As a general rule, our office requests that applications not be published to
avoid incurring this fee. However, if foreign patents are applied for, the
publication becomes necessary and so does the $300 fee.
To maintain the patent in force, maintenance fees are due at 3.5, 7.5 and 11.5
years after the patent issues. The fees are payable to the USPTO and are
designed to clear out "dead wood" from the patent system.
Enforcement and litigation of the patent can be an expensive endeavor.
Unlike many other areas of the law, the patent attorney that drafts the patent
application is often a witness in the case. Accordingly, another outside
patent firm must direct the litigation.
Reexamination of a patent occurs when a patent believes that a patent was issued
in error. For more information on reexamination,