Three Root Causes Why Most Patents Never Generate a Nickel of Revenue (Article 4 of 5) -

Three root causes why most patents never see a nickel of revenue (article 4 of 5)

tpl book

"Patent Offense," Amazon #1 Best-Seller, by Patent Attorney, Craige Thompson

Upgrade Your Patent Process from Gambling to Investing

In this series, I have been sharing my observations about 3 specific root causes of patent failure that arise from a poor patent process.  In this installment of this series, I will propose a complete systematic patent process that I have found to be the best way to eliminate all three of these root causes of patent failure, while (i) improving profit potential and (ii) saving time and money to boot!

The prior articles addressed the failure modes in the patent process that manifest after filing the patent in the Patent Office.  Specifically, those articles addressed failure modes in the last two phases:

1) Phase 2 In the PTO: Failure to plan for success in the Patent Office; and,

2) Phase 3 Post-PTO: Failure to plan for success after the Patent Office.

With that background, this article exposes the hidden failure mode that manifests before the patent application is even filed.

I call this a failure mode because it deprives the client of an opportunity to make an informed decision at a critical point in time.

Phase I, before filing, is critical to making or breaking the success potential of every patent because it is the only time that the outcome can be materially altered.  Once the patent is filed, only the claims are able to change, but they are limited to what was written in the patent application on the day it was filed.  

Nothing may be added to the patent application, and so its potential scope of protection is already fixed in cement on the day it was filed.

Measure Twice, File Once or Not At All

The pre-filing phase is the overlooked high-leverage point in the process. After we push submit to file the application, making changes requires duplicative filings that no one wants to see. It is better to measure twice, cut once when it comes to filing patents.

tpl book

"Patent Offense," Amazon #1 Best-Seller, by Patent Attorney, Craige Thompson

Manufacture a New Decision Point

One of the most exciting by-products of the pre-filing due diligence is that we manufacture a new and very high-value decision point before committing the client to a multi-year, $30K-50K project.

Investing vs. Gambling

What would you call betting on an idea with little or no facts or due diligence to suggest whether you will even get back your investment?

Shocking as it may seem, many lawyers seem to subject their clients to a patent process that is analogous to this:

Just put all the chips on the table, close your eyes, and roll the dice.

I would not recognize that process as investing.  To be charitable, I would call it a "hope strategy," but we all know it is really just gambling!

Do you want to invest your money or gamble?

The Alternative to the Hope Strategy

To increase the "odds" of success, we re-engineered the patent process in Phase I to benefit the clients.  This counter-intuitive approach produces the due diligence necessary to formulate an information-based assessment about two questions the client should be empowered to ask before committing to the entire patent process:

1) What protection is this patent likely to provide?

2) Given the answer to the first question, what return on my investment am I likely to get from that protection?

Compare these questions to a process that merely rolls dice.  Which one is more suitable for an investor?

Benefits of the Investment-Approach to Phase 1

This article is getting long, but I wanted to list out some of the key benefits we have seen from our re-engineered approach:

  • Manufacture a new decision point for the client: For probably for the first time in their life, clients will get an opportunity to review the due diligence and get to answer for themselves the 2 key questions (patentability, business value) and make an informed decision whether to STOP the process before it gets too far!  In the past, we have found about 30% of the time our analysis is to recommend that the client NOT file the patent.  (When was the last time you went to buy a car and the salesman recommended you are better off not buying a car?)  Almost anywhere else, clients might expect to be swept along in the process and just "roll the dice." In effect they commit to the process without an early decision point.
  • The due diligence makes the patent drafting far more focused and informed.  This promotes both faster and less expensive Phase 2, as well as much higher value in Phase 3.

Bottom Line for Business

I am not advocating second-guessing or inviting indecisiveness.  I am strongly advocating for intelligent investment based on reasonable due diligence.

The business value is that ideas should be vetted properly before committing to a multi-year, multiple 4 figure investment in patents.

From an opportunity perspective, proper up front due diligence has massive returns that I can demonstrate.  Incremental costs are more than compensated in any one of at least 4 ways.  

Please refer to my book, Patent Offense, for a full explanation how a small investment in due diligence returns massive reductions in cost and massive improvements in monetization potential.  

In short, including due diligence to inform a client decision is a no-brainer way for business clients to upgrade from gambling to sophisticated investing.


This article is the fourth in a five part series that address issues I discuss in my new book:  Patent Offense.  If you would like to know more about these issues, or you want to find out how to get a copy of the book, please call my office at (512) 649-1046 and we will be sure to let you know how to get a copy.  Thanks much!



Craige Thompson, JD, EE, PE, Patent Attorney

Craige Thompson JD, EE, PE Patent Attorney Author of Amazon #1 Best seller, Patent Offense

Alan Tholkes President and CEO at Medthera, Inc.

Thompson Patent Law Office does GREAT work!

Thompson Patent Law Office does GREAT work!