This article first appeared in Celsias.
So you've developed a brilliant new clean technology? Its widespread use will benefit humankind greatly but you are loath to simply give the technology away without some form of compensation for your efforts. The answer? A patent.
What is a patent?
The traditional view of a patent is that it confers a monopoly on the use of an invention to its owner and the owner wields the patent like a bludgeon to prevent anyone else benefitting from the invention.
The reality is quite different. A patent is a tool that entrepreneurs and businesses can use to obtain financial reward for developing the technology and exert some control over the use of the technology while still enabling its widespread adoption and use.
Technically, a patent is an exclusive property right rather than a monopoly. A monopoly literally means no competition. A patent confers a right to exclude others from making, selling or using an invention without authorisation, but it does not guarantee a monopoly position in the sense of having no competition. For example, there are literally hundreds of patents covering different ways of generating solar power, but there is no one monopoly provider of solar technology.
Balancing altruism with financial benefit
It is vital that advances in clean technology are adopted as widely and quickly as possible for their benefits to count. But for advances to be made in the first place there needs to be an incentive for industry to invest in research and development. The promise of financial rewards or an improved market position provides strong motivation for an innovator or technology company to invest time and funds in R&D to generate innovation.
That is where patents come in. They enable a balance to be found between altruism and financial gain. Patents enable innovations to be licensed so that innovators can realise financial rewards from such innovations while enabling their widespread use and consequent benefits to society.
Faster path to market
Patent licensing also enables beneficial technology to get to market faster. A cleantech start-up could take a decade and millions of dollars of investment to establish a path to market with strong distribution channels in just one country. Licensing a patent to market leaders with extensive existing distribution channels and large marketing budgets in different geographic regions will enable the technology to enjoy a much faster widespread uptake.
Of course, these benefits of patents are relevant to all forms of technology but it is in the cleantech sector that rapid and extensive uptake of new innovations is especially desirable for non-commercial reasons.
Protecting clean technology with patents
So how can you use patents in this way?
After developing a new clean technology it is critical to file a patent application before publicising the details of the technology. Even if you choose to abandon the application or decline to enforce your patent rights, filing an application preserves your position and keeps your options open. Your rights to the invention will be severely jeopardised if the details of the invention are publicised or a product incorporating the invention is sold before a patent application is filed.
Once a patent application has been filed for your clean technology invention, you have a degree of control over the invention and how it is used. That control is cemented once the application is granted as a patent.
A granted patent gives you the ability to control the use of the invention according to your commercial strategy. You can prevent others from making or selling the invention, license the invention or simply allow the invention to be used by anyone. A patentee does have the ammunition to try to monopolise the invention in a particular market, but this is merely one commercial strategy and is not always the best financially.
Sometimes the smartest thing to do is to license the technology at low cost. This enables the widespread use of an invention and still provides financial reward for the development time you have invested. If the terms of the licence are sensible, competitors wanting to use the beneficial technology are likely to follow the path of least resistance and pay you a small royalty rather than pursue the costly and uncertain options of risking an infringement action or challenging your patent.
Enabling further innovations
Few people want to limit the prevalence of clean technologies. But it is naïve to think that clean technologies will continue to be developed at the rate necessary to meet our planet's environmental needs if the innovators are not financially enticed into innovating in the first place.
By the clever use of patents, innovators can sustain their businesses to ensure they are able to continue developing clean technologies in the future.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
James and Wells is the 2010 New Zealand Law Awards winner of the Intellectual Property Law Award for excellence in client service.