Slashdot Mirror
Designing a Patent-Incentive Program?
SoulMaster writes "The company I work for (we are a one-year-old start-up) has recently started filing patents to protect some of its intellectual property. At the onset of the patent process, one of the executives drafted a very basic Patent Incentive Program (PIP) which is now under full review to ensure that it is both accurate and fair. The basics of our original PIP are that inventors receive (or co-inventors share): $500 for each provisional filing, $1500 for an actual patent filing (with full claim-sets defined), and $5000 for any patent that is granted by the USPTO. While the current program seems fair to our staff, we have been unable to find anything to compare it to. Moreover, the revamp of the program is likely to grant an equity stake in the company (via an Options grant) rather than cash payouts. I've scoured Google for information, but because internally documented PIPs aren't generally public knowledge, the results are limited. Thus, I have decided to ask Slashdot users: How does the company you work for handle Patent incentives? Do they have them at all? Are they cash or equity based?"
Give a cash bonus plus stock, but make sure you have some sort of review process to make sure the patents being filed are not clearly derivative or otherwise not likely to be granted a patent.
The cash bonus gives people an immediate reward for their work. The stock bonus gives people a sense that they are working on something that will benefit them, and not just their employer, over the long term. The review board keeps people from abusing the system by flooding you with patent applications that are highly unlikely to be accepted.
Just remember, if you make the rewards too small, no one will take the program seriously and no one will put forth any real effort to invent patentable stuff.
Because more patents are not necessarily better.
Additionally, certain patent acquirement strategies significantly increasethe risk of being the target of patent lawsuits, because they paint a bullseye on your company's strategic development, enabling patent trolls to predict it, patent "alongside" your development and sue you based on that.
And then there's still this whole patent bubble that's still forming, fairly similar to how the whole credit crisis came to be. In time, the value of patents is going to come crashing down just as spectacularly, regardless of how many times you repeat the holy yet hollow mantra "but our intellectual property must be protected!"
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I think that what offends employees is when a company pays a pittance to an employee for filing the patent, but years later make a huge windfall profit out of suing others. Partial ownership of any such profits or partial ownership in any profits made through selling the patent to someone else would take away this issue. As long as there is no cash gain from the patent, the partial owner does not gain from it.
The scheme would take a couple of other provisions: a royalty free, perpetual license granted to the employer (for us of the patent in its products), valid unless there was a change of control of the company. This would also the company to use the patent, and would allow the employee to profit should the patent become so valuable that the company was bought to get control of the patent.
It the company does successfully use the patent defensively, the employee should get some kind of bonus out of it. The patent may have just saved the company from shutting down, so why not some kind of bonus?
The real "Libtards" are the Libertarians!
The entire idea of a "patent incentive program" seems preposterous to me. Why on earth would a company want to incentivize employees to churn out patents? Patents are usually worthless. The vast majority of patents (like 99%) have absolutely no value. Most patents will not yield enough money to recover the $5000 spent on incentivizing the employee, to say nothing about the many thousands spent on patent attorneys.
Generating valuable intellectual property is enormously more difficult, and far more valuable, than patenting things. I could come up with 10 patentable ideas off the top of my head (and I have patents from various employers).
I would also have grave concerns about any company that focused on patents. In almost every such company I've dealt with, they did not have any intellectual property worth patenting. It is an absurd presumption for any company that they will turn out discovery after discovery which warrants protection, or that they will turn out discovery after discovery if they institute an incentive to do so. Instead of worrying about patents, their concern should be having one discovery or one program that is worth anything at all. If they manage that, then they'll be ahead of 90% of startups. But if they concern themselves with protecting intellectual property rather than generating it then they're in big trouble.
However, if the company is insistent on offering incentives for patents, then it should offer incentives based upon how much money others will pay to license the intellectual property and use the patent. If the amount others are willing to pay for a given patent is "$0" (most likely) then the incentive to employees should be nothing.
In other words, if they offer a monetary incentive per patent, then the employee is paid to produce any kind of patent. The idea is absurd. Happily, the USPTO no longer accepts patents for perpetual motion machines, otherwise I as an employee would generate 20 patents just for that.
The review board keeps people from abusing the system by flooding you with patent applications that are highly unlikely to be accepted.
The way to help prevent abuse is to only give incentives for patents that are granted. A cash incentive can be given as soon as the application is approved, then stocks or stock options can be issues periodically. Say if it's 100 stocks after a year 25 stocks are given, after 2 years another 25 stocks are given, and so on. That way if a patent is contested after approval while the person will get something, the employer doesn't have to pay it all out.
Falcon
Should there be a Law?
This is incorrect, to my knowledge. Universities and other institutions engaged in what is essentially publicly funded research do not keep control of the patents that result from research: rather it's the individual researchers themselves who retain control of such patents.
What do you suppose they do with those patents? They start an outside company not affiliated with the university to capitalize on the patent(s) and reap personal profit from it. The university basically doesn't get - or isn't legally entitled to - a dime of that profit. This has been happening for decades.
Frankly, such patentable innovations discovered by virtue of public funding should be registered to The Public Domain (or Public Trust), rather than to individual researchers or even universities. If it's bragging rights they want, they can still proclaim their involvement. If public resources, taxes or the equivalent, made the research possible in the first place, though, then no individual person or institution should be able to claim any exclusive legal ownership of that little piece of knowledge.
(Frankly no one should be able to claim exclusive legal ownership of any bit of knowledge, IMO, but I'm throwing the dissenters a bone here.)