Chris Baxter shares how to use IP to unlock startup valuation at the pre-traction stage in the first Part of the series Why Investors Always Ask About IP.
An Innovation patent is a second tier form of patent protection in Australia primarily developed for use in protecting incremental innovation. However, innovation patents have now become a useful and strategic litigation tool.
There are three main benefits to filing an innovation patent application:
Two disadvantages of the innovation patent system are that innovation patents only last for 8 years and that innovation patent applications may not include more than five claims.
Yes – if your product has a feature that is new when compared with the prior art. That new feature can be obvious but must make a difference to the functionality of the product. The prior art includes all patents and published patent applications worldwide, as well as all other publicly available information.
The following section outlines the Australian innovation patent process.
Once filed, an innovation patent application will pass through a formalities examination. Your patent attorney will receive notification of grant or a formalities report within three months of filing the innovation patent application.
To obtain an enforceable innovation patent right, a Request for Certification of the granted innovation patent application must be filed with IP Australia – this can be done at any time after the innovation patent has been granted. IP Australia will then conduct a substantive examination of the Innovation Patent to determine whether the Innovation Patent is new and includes an innovative step over the prior art. Anyone (not only the owner of the Innovation Patent) can request certification of the innovation patent at any time during the term of grant.
If the innovation patent application is successful during examination, it will be certified. A certified Innovation Patent can be used to stop infringement of the innovation by third parties in the Australian Federal Court. However, most disputes are settled out of court. It should be noted that certification is not a presumption that the innovation patent is valid.
Included in the innovation patent costs, annual renewal fees are payable throughout the life of the patent, which is up to 8 years.
The flowchart below illustrates the innovation patent process in Australia.
(Click on the image to zoom)
There are a variety of strategic uses for the innovation patent system. Here are some strategies that have been adopted by our clients at various times: