What Investors Should Do Before Marketing Their Products
An inventor has one of the toughest yet most exciting and fulfilling jobs in the world. You get to build things from scratch and solve problems that others aren't able to. For many inventors, it is not the inventing, but the marketing that is most challenging. Unless the inventor happens to also be a good business man, the inventor will want to find a company or investor to assist with the marketing and sale of the invention. To successfully pitch to a company or an investor, you need to disclose some crucial information.
What Happens When You Disclose an Idea
In most European countries, if you want to get a patent, you are prohibited from disclosing your invention to the public before filing a patent application. If you disclose your invention to the public before filing a patent application in these countries, you are not entitled to an issued patent.
Canada and the United States work differently. They are more lenient when it comes to this concern. In these countries, you have one year to file a patent application, starting from the day you make a public disclosure about your project.
A patent protects your product, design, or process. It gives you the right to exclude others from exploiting or stealing what you have. It is also called the exclusive right of the invention. If your patent application in Canada is accepted, it will provide 20 years of protection from the day you file your application. With this, you can ensure that your invention is safe, and you will be more confident in making a business out of it.
Now, how will you market your product safely without risking the possibility of losing your patent and exclusive ownership?
The best way to protect your invention is to prepare and file a well drafted patent application before disclosing an invention to anyone. There are two other options available, however each comes with their own risks.
Option A: Let Everyone Involved Sign a Non-Disclosure Agreement
An NDA or Non-Disclosure Agreement is also known as a Confidentiality Agreement. This document will protect your project's confidential information during all forms of discussions, proposals, reviews, and negotiations. As the disclosing party, this agreement allows you to share valuable information and control how the receiving party can use this information.
A properly written NDA is a legally binding agreement that can be used in courts, and you can use it to your advantage. Here are the critical must-haves of your NDA:
- A clear statement of whom the agreement applied to
- All the details that the agreement protects
Tip: As much as possible, share only the necessary information needed for a particular discussion. If you mention specific information not noted in the NDA, make sure to leave a note in each document pertaining to the subsequent information.
The downside of a Non-Disclosure Agreement is that if a disclosure occurs, whether through an intentional breach of the agreement or accidentally, it can have a negative impact on the countries in which you are able to obtain a patent. In Canada and the United States, the disclosure would start the one year grace period. For most European countries, you are no longer eligible to obtain a patent.
Option B: Make an Incomplete Patent Application
When you make an Incomplete Patent Application, you secure a filing date that you can use later when you complete or file a regular patent application. The Canadian Patent Law works the same as the US, which means they follow a first-to-file basis.
That is why if you are going for this route, you need to apply for one as early as you can. The first-to-file basis means that the first person who secures the idea will be entitled to the patent. If someone else copies your concept, but you have already processed an incomplete patent application, your invention will still be safe in your hands.
You are then free to disclose your invention details to other people. However, note that the document from this application will be in the Patent Officer's hands until it becomes official.
There are risks to filing an incomplete patent application, including forgetting to file an appropriate application in the future and potential issues related to the priority of new information added when the complete application is prepared. While this is always an option, it may only be recommended in specific circumstances.
The idea of marketing your invention can be daunting, but do not let this distract you from the fact that you need to protect your project. You worked hard on it, and you deserve all the recognition and revenue from it.
The patent process can be confusing and small mistakes can have large consequences. The assistance of a registered patent agent can be invaluable before and during the patent process. Having a clear plan for protection can be important. Book a consultation with Prowse Chowne LLP for assistance in planning, drafting and filing patent applications and managing a patent portfolio.