The flood of patent filings and litigation between companies has made patent strength evaluation the most important thing in today’s difficult world.
A Summary of Patents and their Strength Analysis
Well! Inventors have come a long way in self-creation thanks to the heat of many developing inventions, ideas, and discoveries. “Patent” is the most advantageous ideology for one’s identity. When someone creates something unique that benefits everyone, they tend to make the copyright of their innovations. A patent grants the right to prevent others from copying, producing, selling, or importing the invention without permission. As a result, patents are regarded as an enterprise’s most valuable asset.
Every year, several patents are granted around the world through various patent offices. Not all patents survive challenges for invalidation if they are reviewed, re-examined, or challenged in court after being granted. According to the PTAB’s invalidation rate, 84% of patents were invalid when challenged in FY20. Patents that fail the strength testing are considered weak, and monetizing them can have serious consequences for the assignee/inventor/enterprise.
The Importance of Patent Strength Analysis
A well-known fact is that obtaining a patent license is extremely expensive. As a result, it is critical to assess the strength of a patent before acquiring a company or purchasing its patent portfolio. Purchasing a patent license without first analyzing its strength may result in serious consequences for the licensee.
Consider this example
Consider the following scenario: Firm A purchases a patent without first assessing its strength. Following the purchase, firm A notices that another firm B launches a product in the market that is similar to the technology in the licensed patent. Firm A requests that firm B cease manufacturing and selling the infringing product because it violates the claims of firm A’s patent.
Firm B refuses to comply with firm A’s request, so firm A decides to file an infringement civil suit against firm B and take the matter to court. This firm has now has two options: (1) pay the royalty and accept the license; or (2) try to invalidate the patent using the invalidity search. As a result of the invalidation search, firm B discovers significant prior art that could invalidate plaintiff firm A’s patent.
The patent, and thus the litigation, has now expired. Firm A’s unplanned action to sue Firm B cost it a lot of money. The money spent on acquiring the patent license and suing firm B was all squandered. Furthermore, if firm A fails to prevent firm B from manufacturing its alleged product, it may give rise to a new competition between firm A and firm B. In this way, purchasing a patent without first conducting a strength analysis can cost a company’s money, reputation, and future.
Given this, one should always think one step ahead when making decisions. It is especially important to have a patent strength check performed in the following scenarios:
- Prior to purchasing the patent from the inventor/assignee
- Prior to acquiring any company
- Before bringing an infringement suit against a company
Patent Strength Checking Parameters
The following are some critical parameters for determining patent strength:
- Number of Claims: It is suggested that a patent with more claims has a better chance of surviving litigation.
- Exhaustive patent prosecution: Patents that go through exhaustive prosecution or face a higher number of rejections during an examination are generally stronger and thus have a higher strength.
- Forward citations: A strong patent is one that has a high number of forward citations.
- Patent family: Because a patent family provides worldwide protection for a patent, it is an important parameter in determining a patent’s strength.
- Claims Broadness: It determines the technological scope of the patent and serves as an indicator of patent strength.
- Remaining life: The remaining life of a patent is another important factor in determining its strength.
- Validity of a patent: This is done to determine the validity of a patent, which also indicates its strength.
- Number of products infringing: Examining products for patent infringement to determine the market strength of a patent
Patent Strength Evaluation Tools
The growing number of patent filings, combined with the advancement of AI, has put significant pressure on programmers and engineers to create advanced AI-equipped tools for assessing patent strength. As a result, XLSCOUT excels in this area with our AI-enabled tools.
Although there are numerous tools on the market for performing patent strength analysis, an efficient evaluation still requires human intervention. This is because an experienced IP professional understands how to effectively use IP-related tools and parameters to conduct a systematic search.
According to the information presented above, it is critical to check the strength of a patent before purchasing it or filing a lawsuit in court. A faulty patent may result in significant financial loss and other consequences for the patent’s licensee. Furthermore, advanced IP tools under the supervision of experienced IP professionals can be used to perform an efficient patent strength analysis.