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What The Law Firm Does
 Legal Representation. The Law Firm of Louis
Ventre, Jr. provides legal representation on intellectual property
matters, including providing advice and legal representation of your
interests in negotiations for licensing of
inventions. Attorney Louis Ventre, Jr. can also prepare a
licensing solicitation letter, and non-disclosure / non-circumvention
agreements for your use. However, Attorney Louis Ventre, Jr. does
not offer opinions on marketability of an invention, evaluate its market
potential, or promote an invention's adoption by any particular industry.
Self Help
Your Invention Marketing. Having an invention
and a patent leads one to consider how to take that invention to the
market place. In order to license your invention to a company already in
the field of your invention, you must first find these companies. Some of
the best ways to find companies to send your letter seeking interest in an
invention are to search for them on the Internet, in catalogs at the
library, and in magazines. Once you find them, visit their web site and
find out all you can about them and their activities that may reflect on
the benefit of your invention to them.
The Indirect Approach. Sometimes the best
approach is indirect, asking a manufacturer if they would prototype your
invention for payment, and then if it looks good after it is made, seeking
their interest in manufacturing. If you will be starting your own business, you should do some research on the usual steps. ChooseWhat (www.choosewhat.com) has one such business checklist.
Finding a Manufacturer. Try a search on Google, Froogle, MSN or other Internet
Search engines. You can find these and a number of other Search Engines at
the bottom of the Law Firm's Useful
Links page. A national "Yellow Pages" directory might
also be useful: e.g., Switchboard, Yahoo
Yellow Pages, 555-1212.com, and Verizon's SuperPages.
Another good source of company and product information is ThomasNet, which is billed as "the
most comprehensive resource for industrial information." When you
have found your industry, see if you can also find any annual exhibitions
for that industry. Attending such exhibitions can be a valuable means of
meeting industry representatives and marketing your intellectual property.
For any self help marketing, remember to follow up with telephone calls to
further explain the benefits of your invention and offer suggestions of
what it can do for them. Be polite and persistent, but take no for an
answer if that is what you get.
The Small
Business Administration (SBA) provides training,
counseling and information on planning,
starting,
marketing,
obtaining
venture capital and financing
a small business. You can also find Local
SBA Resources and a List
of Small Business Development Centers (SBDC).
Reality Check. It is usually a good idea to
have an impartial third party with expertise in the field look at
your invention. You may have to pay them and you should ask
that they first sign a non-disclosure agreement. Typically, this
might be a university professor working in the field, whom you might
identify using an Internet Search. Some services will evaluate
inventions for a small fee. For example, the "Innovation
Institute," run by two Universities, is an inventor assistance
service that promises to provide "an honest and objective third-party
analysis of the risks and potential of their ideas."
Some Risks If you have a valuable invention,
notifying others that you have a patent application pending may cause them
to try to intervene in the patenting process to prevent the patent from
issuing. Also, public disclosure of your invention narrows options for
filing for patents internationally. One method to address this is to
ask them to sign a non-disclosure / non-circumvention agreement. This type
of agreement requires the recipient of the detailed information on your
invention to keep it to themselves and if they decide to use it, not to do
so without your involvement. However, this type of agreement is very often
refused by industry.
Seeking Investors. If you want to solicit
investors to your company so that you can develop your invention, you can
find a list of investors to contact on the National
Venture Capital Association web page.
Business Fund web site provides a list of business funding
sources.
What should you expect to pay for investment in your invention? One source suggests that you should expect to provide
an annual return to an investor based on risk: (1) Angel
Investor: 60-70%; (2) Venture Capitalist: 30-35%; (3) Private
Equity 20+%; and (4) Public Company: 12-20%.
Invention Marketing and Promotion Firms
Hiring Invention Marketing. Invention promotion
companies abound, but can be costly and frustrating option for many
inventors. Some may promise to take most of their fees in a percentage of
royalties made on the invention. The point to remember is that it is rare
for any such firm to take all its fees out of royalties. A Federal
Trade Commission publication states, "Indeed, many inventors
pay thousands of dollars to firms that promise to evaluate, develop,
patent, and market inventions. Unfortunately, many of these firms do
little or nothing for their fee."
Be Cautious. Caution is the watchword. It is
quite common to hear about a promotion company's excitement and the great
potential of your invention before your make your payment. However, it is
also common to hear an inventor complaint, "They took my money and
didn't provide any valuable service in return." After payment of
a substantial fee, inventors are sometimes provided "feasibility
reports" or documentation that may be of little practical use in
actually marketing a specific invention. Many times the performance is a
mixed bag of results, but still leaving a dissatisfied inventor at the end
of the process. See "Spotting
Sweet-Sounding Promises of Fraudulent Invention Promotion Firms,"
from the Federal Trade Commission.
What the FTC Says. The Director of the Federal
Trade Commission's Bureau of Consumer Protection, at a July 1997 press
conference announcing Project
Mousetrap said, "Yet the fraudulent firms in this industry
conclude, after a 'professional' evaluation, that virtually every new idea
or product crossing their desks is patentable and has 'tremendous market
potential.' They promise enthusiastic inventors that they can provide
professional assistance in getting a patent and securing licensing and
manufacturing agreements with manufacturers. Time after time, however,
these firms lie to consumers about the sincerity of their belief in an
idea and its marketability."
The Design Patent Switch. The FTC says,
"Unscrupulous invention promotion firms often apply for patents that
provide such limited legal protection that it is easy for competitors to
find a way to design around the patent." There are two
different types of patents covering different things and each type offers
different protection. Don't be fooled by a firm suggesting a less
expensive design
patent instead of a utility
patent. A utility patent grants exclusive rights relating to the
utility or usefulness of an invention. On the other hand a design
patent grants such rights only with respect to the way an invention looks,
that is its ornamental design, and not for its utility or
usefulness. See "What
is Patentable?" on the Frequently Asked Question page of this web
site.
Ask Questions. Under federal
law, invention promoters must disclose in writing the number of positive
and negative evaluations of inventions they have given over a five-year
period. They must disclose how many inventions they have evaluated; how
many of those inventions got positive or negative evaluations; their total
number of customers; how many of those customers received a net profit
from the promoter’s services; and how many of those customers have
licensed their inventions due to the promoter’s services. The United
States Patent and Trademark Office publishes a document listing the top
ten scam warning signs. Because it comes from an authoritative source,
I've made "Top
Ten Scam Warning Signs" available (pdf document, ~350 kb).
You may not get a straight answer to your questions, but if it comes to a
later charge of fraud, it may help to document their response as well as
their promises. You might also ask if they have any guarantees to get your
money back, if you don't think the service lived up to expectations.
However, you might guess what the answer will be. Other questions to ask
may be found in the publication mentioned in the first paragraph, above.
Investigating the Reputation of a Company. If
you are planning on engaging an invention promotion company, you should
first investigate whether or not there are complaints against that company
and see how they were resolved.
- Internet Search. The fastest and
easiest method for examining an offer is to do an Internet search on
the name of the company and/or individual your are dealing with. You
can add the word "complaint" to limit the returns if you get
too many. A number of search engines are listed at the bottom of this
Law Firm's Useful
Links page.
- United States Patent and Trademark Office.
The United States Patent and Trademark Office maintains a public forum for invention
promoters/promotion firm complaints against invention promotion
companies and responses. The Patent Office accepts complaints filed
against invention promoters/promotion firms and forwards these
complaints to the invention promoters/promotion firms for response.
Both the complaints and the responses are published in this public
forum. Unpublished complaints filed with the United States Patent and
Trademark Office are available on InventorEd, Inc.'s web page.
- Federal Trade Commission. The United
States Federal Trade Commission investigates deceptive invention
promotion schemes and may file a complaint if there is a pattern of
violations. Essentially, this means that there has to be more than a
small number of complaints. The Commission files a complaint when it
has "reason to believe" that the law has been or is being
violated, and it appears to the Commission that a proceeding is in the
public interest.
- FTC Typical Allegations. A typical
Federal Trade Commission complaint would find that an invention
promotion company made false claims, or failed to disclose key
information in the course of inducing consumers to purchase patenting,
marketing and commercialization services. A Federal Trade Commission
complaint is not a finding or ruling that the defendant has actually
violated the law. Rather, a federal district court decides the case.
When a complaint is filed, it is common for the Federal Trade
Commission to request a court order freezing assets and requiring the
preservation of documents of defendants. So it is not a minor event
for such a company to face a Federal Trade Commission complaint.
- FTC Court Cases. You can look at the
summaries of Federal Trade Commission cases and other interesting
items if you visit the Federal
Trade Commission search site and type in the word
"invention". You might also try typing in the name of the
company you are researching.
- Publication: Invention Promotion Firms.
Right click on the following link and save it to your computer: It is
a Federal Trade Commission pdf document titled "Invention
Promotion Firms." It offers tips for consumers who are
considering trying to patent and commercialize their inventions.
See also FTC's "Facts for
Consumers."
- Better Business Bureau. Search the Better Business
Bureau in the hometown of the company. It may offer some
information about complaints they have received about an invention
promotion company.
- State and Local Government. The
state(s) and local government(s) where the company has its office(s)
may also be a good source of complaint information on that company.
That state may have a consumer protection agency. If not, the Attorney
General in that state, or chief legal officer in the local government
where the company is headquartered is a good place to call or send an
email. This takes a bit of sleuthing, but it this could be a large
investment for you. A little effort at the front end of the process
could save a lot of heartache and cost at the back end of the process.
Getting Your Money Back. An inventor might seek
to get his money back from that promotion firm that did not live up to his
expectations. However, this is easier said than done. Once you part with
your money, attempting to get it back may be a long and arduous task.
After a respectful exchange with such a company and finding no measurable
success in getting money back, your last, low-cost steps may be making
complaints to the United States Patent and Trademark Office and the
Federal Trade Commission.
Legal Options
Suit as a Final Option. A lawsuit may be your
final option. If the invention promoter makes a fraudulent representation,
a material omission of fact, or violates his or her duty to disclose, an
injured customer can bring a civil action under 35 U.S.C §297(b)(1)(A) to
recover actual damages, reasonable costs, and attorney's fees. Inventors
who are harmed by a failure to make the federally required disclosures,
described above in the "Ask Questions"
paragraph, by the invention promoter can sue to recover statutory damages
of up to $5,000 or actual damages. Pursuant to the "Inventors Rights
Act of 1999," the court can triple the damages if it finds the
violations are intentional or willful.
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This file last modified 09/08/11.
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