How to Lose Patent Rights

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Thinking of patenting, but waiting for some customers first? Tread carefully. By merely offering your invention for sale, even if the invention has not even been manufactured, you may lose patent rights.

The recent US case of Hamliton Beach v. Sunbeam Products Inc. (Case No. 11-CV-0345, Decided: August 14, 2013) dealt with a challenge to Hamilton Beach’s patent for a slow-cooker design. The critical event was a transaction between Hamilton Beach and a foreign supplier in early 2005. The offer occurred before the patent filing date - to be specific, it occurred more than 1 year before the filing date. This offer by Hamilton Beach was considered by the court to be an offer for sale of a product that anticipated the asserted claims and the court found that the invention was ready for patenting prior to the relevant date. The court noted that “An actual sale is not required for the activity to be an invalidating commercial offer for sale… An attempt to sell is sufficient so long as it is ’sufficiently definite that another party could make a binding contract by simple acceptance.’”

As a result, the patent was held to be invalid.

Remember:

  • If such a sale or even an offer for sale is made when the invention is ready for patenting, that will start the 1 year clock running for patent filing in Canada and the US. The inventor would have 1-year from that date in which to file a patent.
  • This may result in a loss of patent rights outside Canada and the US, for countries in which there is no 1-year grace period.
  • An invention is “ready for patenting” when prior to the critical date:
    • The invention is reduced to practice; or
    • The invention is depicted in drawings or described in writings of sufficient nature to enable a person of ordinary skill in the art to practice the invention.
  • In Canada, the courts have come to similar conclusions - consider this case dealing with a device that was manufactured and rented to a third party for use in drilling an oil well in Texas prior to the relevant date of the Canadian patent. This earlier device invalidated the patent, since it constituted an “enabling disclosure” of the invention more than 12 months prior to filing of the patent application.

Topics:  Patent Litigation, Patents, USPTO

Published In: General Business Updates, Intellectual Property Updates, International Trade Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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