A patent owner can sell or lease the rights granted to him through his patent by giving another person a license to make or sell his invention. Typically, a patent owner will grant these rights through a licensing agreement to a developer in exchange for royalties. If all the patent rights are sold to a person, the sale is called an assignment.
Licensing the rights to make, use, or sell a product is the best way for inventors to make money and profit from their inventions. Since the inventor is usually the patent holder, the inventor can keep the ownership of the invention and receive royalty payments on any future sales of the invention or product through licensing.
What Are Some Licensing Options?
There are several marketing ways to sell and license your invention or product:
- Direct Contact: Make direct contact with manufacturers and potential users of your invention, and showcase your invention to them.
- Trade Shows: Attend tradeshows that allow you to showcase your invention to potential consumers and users.
- Advertise: Buy an advertisement space in magazines and trade publications to showcase your product to potential buyers and consumers.
- Patent Websites: Research patent websites, and try to post on them in order to advertise your invention.
- Look for Investors: Contact investors that would be interested in investing in your product, thereby providing you with capital to launch your product.
Can I Manufacture and Sell the Patented Invention After I License the Patent?
Depending on what kind of license you grant to someone, you may or may not be able to manufacture and sell your patented invention yourself. If you agree to give someone an exclusive license, or if you give someone an assignment of your patent rights, only that person has the ability to manufacture and sell the invention.
Do I Have to Put My License in Writing?
Yes, any assignments of patent rights must be in writing in order to be valid. However, all licenses do not have to be in writing in order to be valid. A license can be oral and will be enforceable if it is qualified as a general contract and follows all the general contract principles, including satisfying the Statute of Frauds.
Should I Record My Licenses and Assignments?
You are not required to record your licenses and assignments with the United States Patent and Trademark Office (USPTO), but you may want to do so. Unless you record your license, you cannot sell it to subsequent buyers or offer it to a secured creditor. Thus, although it is not necessary to record your license, it is probably in your best interest to record your license, even though it is not necessary to do so.
Can I Challenge the Validity of a Patent Licensed to Me?
Generally, patent laws do allow you to challenge the validity of a patent after you have obtained a license for some of the patent rights.
Can I Challenge the Validity of the Patent After I Assign My Rights?
You cannot challenge the validity of a patent that you sold to someone else. This is called assignor estoppel.
Should I Consult an Attorney?
If you have questions or concerns about licenses and assignments of patent rights, you may want to contact a patent attorney. A patent lawyer who is experienced with licensing agreements will be able to help you draft a license or assignment agreement that best meets your needs. Also, a patent attorney can represent you in court if your rights are violated.