The Hidden Cost of a Patent

Lawyers are expensive. Even they agree. Budgeting advice like "take whatever your lawyer just quoted you and double it" is common. How can 100% miss an estimate? Legal services aren't entirely within a lawyer's control.

A painter can paint a wall without needing approval from a 3rd party. The cost is just hours worked and supplies. But a patent attorney, tasked with getting a patent application approved by the United States Patent Office (USPTO), faces uncertainty about the cost.

Drafting the Patent Application - Just the Tip of the Iceberg

Filing any patent starts with drafting the application, typically costing between $8,000 and $15,000 (£££). Sadly, this upfront cost is often only the tip of the iceberg. Filing and getting the draft approved by the USPTO can cost more than the drafting, not included in a firm's drafting estimate.

Patent Prosecution – Additional Expenses Lurk

The approval process, or prosecution, accounts for most extra expenses. These added costs come as a series of Office actions from the USPTO and responses filed by your patent attorney. Most patent applications receive around three Office actions, but some can face many more.

The first Office action from the USPTO is usually a non-final response. You can reply without paying the USPTO a fee, but patent attorneys charge hourly for preparing the response (£££), an extra expense not covered in the estimate.

If the USPTO examiner isn't convinced by the response, you'll receive a final Office action. Your attorney must prepare another response (£££+). Some examiners allow a response after the final Office action, but a Request for Continued Examination (RCE) is typically required. The fee to file an RCE is often higher than the initial application fee (££), and patent attorneys usually charge for preparing a response with the RCE. If an attorney's response isn't compelling after the non-final Office action, the cost of continuing to prosecute your patent doubles! That's the 100%.

If the RCE response isn't compelling, you may receive more Office actions. The dance continues until the USPTO finally allows the application or you give up.

The real cost of getting a patent comes during prosecution and can be several times more than the original estimate to draft and file your patent application.

Limit Office Actions

The USPTO's approval isn't entirely arbitrary. It's possible to draft an application and respond strategically, avoiding RCEs. An experienced patent professional can predict a patent examiner's response to a specific application and the most compelling arguments.

Remember the hidden costs of Office action responses and RCEs when comparing legal costs. If the draftsman isn't informed (by experience, technology, or both), you could face a long exchange of Office actions, responses, and RCEs, making your costs skyrocket.

The Hidden Cost of a Patent

Comments

More from this blog

How knowledge workers master IP-driven tax mobility

Why licensing your AI likeness to a discretionary family trust triggers an ATO audit

Structuring overseas payments and crypto rails for ACNC (not for profit) co-operatives

Selling the invisible: How businesses use collective marks and certification marks to generate income

Unlocking invisible capital: A business owner’s guide to low-cost creation of intangible assets and generating cross-border income from them

Drafting the Patent Application - Just the Tip of the Iceberg

Patent Prosecution – Additional Expenses Lurk

Limit Office Actions

Command Palette

Comments

More from this blog

Drafting the Patent Application - Just the Tip of the Iceberg

Patent Prosecution – Additional Expenses Lurk

Limit Office Actions