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Episode 36: Trademarks and Patents as Tools for Protection and Residual Income with Matthew Leaper
172 Plays6 years ago
The world of trademarks and patents can be very confusing. Our guest on our latest podcast is going to remove that confusion.
If you are an entrepreneur, business owner, or inventor, you run into questions about trademark and patents all the time. What does common law cover when it comes to trademarks? How much does it cost? What kinds of brand and product essentials should be trademarked? Patents are a whole different ballgame. But a patent, especially a provisional one, may not be as big a hurdle as you might think.
On this episode, we talk with Matthew Leaper, a true expert in trademark and patent law. He answers all the above questions and more and talks us through the various ways to monetize your intellectual property once a trademark is received and a patent is approved.
Matthew Leaper is an attorney with Smart & Biggar/Fetherstonhaugh, one of Canada’s premier intellectual property law firms. Matthew works with innovators to refine and protect their ideas, having learned best practices from some of the best intellectual property firms in the U.S. and Canada. He has worked to zealously serve some of the most IP-oriented, innovative companies in the world.
From these experiences and capabilities, he has developed subject matter expertise in numerous technical areas, and become highly skilled at generating value from that expertise. He has worked closely with inventors and business managers to draft patent applications. These cover a wide range of technologies including diagnostic sensors; energy efficiency technologies; laser technologies and applications; manufacturing methods; medical devices and implants; non-invasive surgical technologies; and software applications, including artificial intelligence and machine learning.
This episode is for informational and entertainment purposes only and is not to be construed as legal advice.
what you will learn in this episode:-
- How trademarks protect brand identity
- Tools to research trademarked names through TESS
- The cost and process of registering a trademark
- When to go the “free” route and when to register a trademark
- The scope and limitations of a patent
- The strategies to understand in filing a provisional patent
- How prototyping fits into patent development
- Why some products can be protected by both trademarks and patents
- How the geographic scope of your patent can affect your licensing strategy
- Intangible values of having a patent
Recommended
Transcript
Introduction to Uncommon Life Project
00:00:02
Speaker
Everyone dreams about living an uncommon life, but how we define that dream is very different for each of us. And for most, it's a lifelong pursuit. Welcome to the Uncommon Life Project podcast. We're going to introduce you to people who are living that life or enjoying the journey to get there. We're going to also give you some tools, tricks, and tips for starting or accelerating your own efforts to live an uncommon life.
00:00:27
Speaker
A life worth celebrating and savoring. Please welcome your hosts, Brian Dewhurst and Philip Ramsey.
Theme: Residual Income - Royalties
00:00:35
Speaker
Hello and welcome to another episode of the Uncommon Life Project where I'm your host, Phillip Ramsey. And I am Brian Dewhurst. And today we have more of a tangible show for everyone. One that is one of our seven sources of residual income and we have an expert on this whole topic. It's Matthew Leeper, which has been good friends with Brian Dewhurst for quite some time. So I hope we get into some personal stories.
00:01:00
Speaker
Maybe the time when he was cross-dressing. I don't know. Maybe, maybe not. Totally joking. Brian, hit us with a bio. Let's jump in. Yeah. And before we get started, we just wanted to make a caveat that this episode is for informational and entertainment purposes only and is not to be construed as legal advice. Thank you.
00:01:16
Speaker
So Matt, we go back almost, I think, 15 years, so this is super exciting to me.
Introduction to Matthew Leeper
00:01:22
Speaker
Matthew is a specialist in intellectual property. He's an attorney with international experience as well. He actually resides in Canada right now. Expert idea builder and patent drafter, creative thinker with deep analytical resources and business acumen, and an avid public speaker. Welcome to the show, Matthew Leeper.
00:01:41
Speaker
Thank you very much guys look forward to being here and sharing some insights on these topics nice So what is the seven sources that we're gonna jump into Brian talk
Trademarks & Patents Basics
00:01:49
Speaker
about? Yeah, so we've been meeting a lot more people It's just part of our normal course of business and talking about the seven sources The one that I think is probably the furthest Reach for most people and even including ourselves that we probably the least experience with is
00:02:07
Speaker
I would say kind of like royalties is the sixth residual income. And so we wanted to have on someone to kind of break down as you're building a business, as you're building a brand, trademarks and how those apply to business and branding and protecting your intellectual property and then also patents. And so we've had several people kind of approach us with, hey, I've got
00:02:32
Speaker
some patents with a, you know, public company, but I've got other ideas and I'd like to pursue potentially patents on my own. And that's a different process, you know, not having a corporate backing, so to speak. And some other people just some invention ideas and then as it relates to kind of
00:02:49
Speaker
intellectual capital, that type of thing. So we're going to try to be very practical with our listeners today. And Matthew, you're going to be the perfect person to dive in on each one of these little nuances. And being that you're a lawyer, you have great knowledge and expertise in it. So thank you for being part of the show.
00:03:05
Speaker
where do we start this whole conversation? Oh, absolutely. Happy to help.
In-depth on Trademarks
00:03:10
Speaker
So basically if you got two tools in your tool vault that we're talking about, we're talking about trademarks, which protect your brands and how customers perceive your products and your services in the market and the goodwill associated with that.
00:03:21
Speaker
versus patents which protect the utility or the design of certain novel aspects of your business, various products or services or methods or things of that nature. So there are two kind of fundamental different types of protection, but what they both are, are intangible assets that are on the balance sheet that you can use to generate revenue with.
00:03:43
Speaker
So basically, I want to just talk about those two tools from the perspective of the startup or the more individual inventor or the growing concern and help people understand how to use them, when to use them, give a basic sense of costs and a basic sense of what they can do on their own without professional support to de-risk and make sure that these are valuable tools for them. Nice. Perfect. Perfect agenda.
00:04:13
Speaker
So let's jump into, let's start with trademarks, if you would, and kind of just start there. Yeah, no problem. So trademarks protect, you know, as I said, the brand
Importance of Trademarks
00:04:25
Speaker
identity, and they guard against what's called consumer confusion is really why they exist.
00:04:30
Speaker
And that's to prevent some consumer from going to the store and buying one of your competitors products, thinking that it's your product. So basically, for example, what happens is you'll have a lower cost provider that might try and somehow or another use your branding or your designs or your trade dress or something of that nature, and then try and, you know,
00:04:48
Speaker
sell their product and get somebody to just buy it. And that happens all the time. And you go to Amazon, you hear about some of the things that's happening from products from other countries and such. And a lot of times, it's a lot of trademark violation because there's a cheaper product that's coming in, sneaking in as your kind of brand. And somebody's buying it and they're getting your margins and they're decreasing the value of your brand because it's often a lower quality product.
00:05:12
Speaker
So, could you think of like Gucci in New York? You know what I'm saying? Like the old Gucci bags? Yeah, those are extreme examples and there's even simpler examples beyond that where it's just still a problem for somebody to try and appropriate it. Some kind of similar naming or anything along the line.
00:05:31
Speaker
Yeah, that's really a good point, especially for Brian and I, like the uncommon wealth partners, the uncommon wealth, like I feel like we need to get that trademarked and we have not done that yet. I mean, this is great for me. Come on. Let's go. Matthew, you're my man. Let's keep going. I love it. Yeah, no problem.
Trademark Process & Costs
00:05:46
Speaker
So the nice thing about trademarks is that you get some level of protection, whether or not you pay any government fees or not.
00:05:53
Speaker
under what's called common law. That doesn't happen in every country in the world, but it does happen in US, in Canada, and the commonwealth countries, the UK, things like that. So basically, if you're putting your product to use in a local market, you're going to get some rights to be able to prevent others from using that exact name out of the gate.
00:06:12
Speaker
Now the benefits of having a federally registered trademark for comparison, which is kind of what people think about when they think about getting a trademark. And that is filing an application with the United States Patent and Trademark Office. And then that basically makes your trademark national in scope. So basically anywhere in the US, whether you're active there or not,
00:06:31
Speaker
you know, then you're there. Now for your business, you guys are an internet, you know, providing a service over the internet, so arguably you're everywhere, but nonetheless, there's still someone who would argue that, no, no, this is, you know, this is, you know, Midwest at best. There's a fight to be had if somebody picks the exact same name in LA, and they start getting a bigger following than you. The benefit of filing that registered trademark is that you're kind of there and you're ahead of them. And then the other nice thing about trademarks is that if you get it and you keep using it, they last forever, as long as you continue to use it.
00:07:01
Speaker
Wow, I did not know that. How much would that cost to try to get registered?
Trademark Strategy Advice
00:07:05
Speaker
Let's just go through it. And you said there was a free option where if you just put it out, you have some level. Well, I mean, yeah, yeah, yeah. The free option is just use it, you know, so, and you're already doing that now. So for, you know, to use these guys as the example, you've got your website, you've got your logos out, you know, you're already, you're already making products that are covered by what would be your common law trademark protection.
00:07:23
Speaker
Again, the benefit of the registration is that it takes you out of nationals. There's some searching involved because you want to look around to see if anybody else has that exact trademark before you go spend money on a trademark app. The tool is called the Trademark Electronic Search System, or TESS.
00:07:42
Speaker
And it's available somewhere on the USPTO.gov. And it's just a free way to go out there and see if someone else has registered your exact name. And you can see if they have, and if it's in a different service category than you, then maybe there's still room for you. If it's in the exact same service category.
00:07:57
Speaker
you know, that can be a problem. And so, you know, you can decide whether it's worth it to rebrand or whether it's worth it to go try and fight through an application or, you know, all kinds of questions that, you know, will get more complex if somebody happens to be right in your way. Yeah, let's talk through that because we've had a couple people, clients-wise, that have gone through this and was like, it's not a big deal. I'm thinking about Adam.
00:08:18
Speaker
Well, if no, if you pick a really wild name, you know, like, uh, you know, like wild Turkey financial, you know, then, uh, you know, then nobody's nobody's usually people aren't associating wild Turkey with, uh, you know, with financial services. So then it's unlikely that anybody's going to like, you know, stop you or be in the way, but it really can derail you. I think about, um, Yeti cause like, you know, the Yeti microphone brand and now you've got the Yeti.
00:08:43
Speaker
Cooler good boy recreation brand i mean they're both using the identical name. Yeah it's totally different businesses yeah and that's what i mean my service categories like they can they can have different service categories but if you're gonna go if you're gonna have the same exact name you better have different logos and there better be some differentiation or you're gonna eventually gonna run into a fight.
00:09:03
Speaker
Gotcha. And that's why this trend toward having wild startup names and things like that, it's actually not, from a trademark perspective, it does make things easier. If you're making up a whole new word that no one's ever used before, then that's how it works. In terms of the trademark scale, the strength of your rights, there's a scale that means it's either super nuanced, it's a very uncommon word, very exotic word. Thank you. All the way down to banking for banking.
00:09:33
Speaker
You know, so like, you know, the more generic you are, the less strong your rights might be. And the more exotic you are, the stronger your rights might be, particularly if
Comprehensive Patent Explanation
00:09:41
Speaker
nobody else is using that exotic name, because then anytime here's any time anybody hears the word, you know, some magical word, they just that's it. That's all I think. Philip, Philip is a huge proponent of the sport spike ball. And like they that was the name of their brand, but it also eclipsed the name of that like sport. Right.
00:10:02
Speaker
And they were forced to do something, weren't they? Yeah, another one is Rollerblade. Yeah, Rollerblade. They were forced to not call them Rollerblades anymore because that was the company name. Yeah, that's right. So that's the other side of trademarks. That's kind of the risk side of trademarks is that, you know, if you get your mark and you succeed, your mark becomes so popular like Kleenex for Kleenexes, then basically everyone's using the mark and you can't really stop people from just saying, you know, the name of a thing.
00:10:28
Speaker
So that goes to also relying on counsel or just being really careful that you brand your product. So in other words, it's a Kleenex tissue, not a Kleenex by itself. So those kind of nuances are things you do after you get the right to maintain it.
00:10:44
Speaker
Wow, that's really cool. So now that was a free route. Let's talk about how much it is. If you're going to go get a registered. Yes. So no, we danced a little bit in the registered process there because either way you're going to, you know, the free route is you just put it to use. You don't have to do any searching. If you're going to register, kind of the first step is to kind of do some searching to get a sense of whether you should register.
00:11:05
Speaker
If you've done your searching and you determine that, yes, this is a good idea, then there's a couple thousand dollars in preparing an application, moving it through, and going from there. On the low end of that, hopefully, if there's nobody in your way, the application just sails through and there's not a lot of attorney time involved. Basically, you file it. It goes through the process. If nobody raises their hand and says that they object.
00:11:28
Speaker
No one's in your way, then you're going to get the right fairly inexpensively for a couple thousand dollars. If you have to go and argue it or if you're going for an exotic right to, for example, to a smell or a color or some other kind of non-verbal type of unique trademark protections, then you're going to pay a bit more for that. That's crazy. You can do smells. Unreal. But it makes sense. Totally makes sense.
00:11:54
Speaker
The Louis Vuitton red bottom shoe is one that I find interesting because you see that anywhere and you immediately know. You're like, oh, that's a Louis Vuitton. That's what that means. Wow.
00:12:05
Speaker
Okay. Wow. Cool. Okay. What else do we need to talk about that trademarks and then we can move to patents if you want. Um, I think those, those are the, those are the biggest things with trademarks is that you get a little, you get some rights just by putting it to use. And what I generally advise is, you know, if you have the capital upfront, great, go ahead and file your applications and get it. If you know, you want to get out there and test the market a little bit, spend some time testing the market, get some revenue after you've got a little bit revenue going.
00:12:29
Speaker
then go ahead and formalize your right. And I don't think that's bad advice, but it's kind of just a business risk, and how aggressive do you want to get with it? I want to go to patents, and I want to come back to crazy stories. Yeah, yeah. Because I know you got some. OK. Go to patents. All right. So with patents, I kind of want to just start with when people kind of come in contact with patents, generally speaking, if it's in a non-corporate sense. And that's either they've come up with some idea that is the next big thing, or a good friend has.
00:12:58
Speaker
And the good friend is like hey i need to raise some money we will you go in with me those are kind of the two contacts where somebody starts thinking to the cells okay how much is it gonna cost to get this right and that first half of the conversation is important is you have to really be careful with that initial investment is worth it but then there's a whole lot of other money that may need to be invested to monetize and figure it out so it's bigger endeavor than most people think.
00:13:21
Speaker
And, you know, so it's just important to really kind of frame patents as a higher risk investment at times for a lot of reasons. It's not that there can't be great returns. And, you know, the Super Soaker is a product example that was very successful. And there are many, many like that. But, you know, it's a different animal.
00:13:38
Speaker
Good point. Walk us through, I'm a huge fan of Shark Tank, the show I watch with my kids and a lot of times they have these people on there that have produced an item or something. And I think it's important to maybe in the context of this conversation framing the difference between a product and a business, a lot of times these guys are like, well, this is a great product, but it's not a business.
00:13:59
Speaker
And then the next question they'll ask them is, you know, do you have a patent? And they'll say, well, yeah, I have a provisional patent or I'm patent pending. So can you kind of walk our listeners through kind of those nuances? Yeah, you'd be happy to do that. So first we'll start with just what is a patent? What is the legal right that we're talking about here?
00:14:17
Speaker
And it's two basic things. One, it's a right to exclude anyone else from making or using your invention. So it's not a right for you to practice it necessarily, but it's a right to stop others from doing it. And in that regard, it can be viewed as a legally sanctioned monopoly of sorts. Now, it's a limited monopoly because if you become the only person in the industry, you're still going to have
00:14:39
Speaker
anti-trust problems, but if you're a smaller startup and you're moving forward, it's a fairly limited monopoly. And so the idea is you kind of want to work carefully to make sure you get a broad scope of rights that really cover the magic of your product or the magic of what you're offering or the secret sauce of it.
00:14:55
Speaker
And it may not be the entirety of your product line. It may just be some flagship parts or a critical component of a lot of your products. But that's kind of what you're getting a patent for, is to kind of get that protection, right? So that's what the end goal is. Now, compared to a trademark, a patent is a 20-year monopoly.
00:15:11
Speaker
So, you know, and it has a much more rigorous examination process up front. And so therefore it can be a lot more expensive. And so that's kind of, you know, those are all things to think about. And so with that said, then we'll kind of pivot a little bit to the process. And then I can kind of use that conversation to both outline the process and kind of explain where the costs are and most importantly, talk about the things people can do, you know, themselves without having to hire someone.
00:15:36
Speaker
You're doing great. You're killing it. Keep going, Matthew. All right. Cool. Glad to do it. All right. So where a lot of individual inventors start is with a provisional application, especially in the US. And what that is, is it's an unexamined filing with the patent office that gives you a filing date and allows you to say that as of that date, this is what I invented. This is mine. I'm going to figure out some claims to it later.
00:16:03
Speaker
You don't have to have claims at that point. It can be fairly informal, all the way down from just your notes, all the way up to a full-blown compliant patent application. Whatever it is, you're able to rely on it and go from there. For a lot of individual investors and investors for that matter.
00:16:21
Speaker
The challenge with a provisional, and this is probably one of the more important parts about patents, is that it can be a trap. Because if you come in too early, and you only got your idea halfway baked, and you write the provisional yourself, and you just kind of throw it together and file it, and that's that. And then after filing it, you go and talk with a bunch of people. And then maybe you realize some of the best parts about your idea later, there can be a challenge between what's filed and what's out there. So there's a lot of homework that needs to be done. And while you can just go file anything,
00:16:50
Speaker
It's far better to keep everything super quiet for as long as you can like literally just yourself in a small team everyone under nda and develop something slowly than it is to rush and so so that's what a provisional is.
00:17:04
Speaker
It can be used effectively and it can be used ineffectively, but it's just an unexamined filing that gets you a filing date. Okay. Good. Yep. And so the costs of that, the filing costs are very low. If you're a first time inventor, the costs are like $60 US to file it. So the filing costs for the government aren't much.
00:17:22
Speaker
But where people will spend money is in making the application, giving it some weight, giving it some thought value, so that when you want to rely on it later, you've got some really good stuff. And the best practice, what the big guys do, what the leading inventive companies in the world do, is that when they file a provisional, they just pay the money upfront, and it's basically a full-blown perfect application from the gate.
00:17:49
Speaker
And they can afford to do that and they can afford to drop some and not go with others because their economics are different. But that doesn't mean it's still not the best practice, which is to make sure that your provisional is professionally drafted and does a very good job of describing the subject matter without unduly limiting the invention or holding something back or whatever. And I guess the last thing I would say on all that is...
00:18:15
Speaker
To have a professional help you file the provisional with minimal edits, you're looking at a couple thousand to draft a full-blown application and file that. It depends on your subject matter of your technology. That can go 10 to 20,000. It just depends on what are we trying to invent here. Is it a new chemical formulation to cure cancer, or is it a new type of aluminum can? The relativity is there to the complexity. So anyway, that's what a provisional does, and that's how that works.
00:18:42
Speaker
and you try to make that as general as you can like there is a wedge that looks like this and it doesn't even show tell you what like industry it's supposed to be working in it's just a wedge and see if you can get that passed is that correct or is that wrong um what do you mean by wedge in that example like uh like like the the application itself or
00:19:02
Speaker
Or like the actual invention itself. Like you try to generalize that as easy as possible. So it could be like any wedge, but like obviously that wouldn't happen or that wouldn't go through, but you try to make it as broad as you can, like a broad stroke. Yeah. No, I see what you're getting at. So, and so that gets to the question of patentability, which we can kind of talk about because obviously there's no point in filing a provisional or non-provisional or anything after that. And so you've had a sense to kind of figure out is my invention patentable. So the, you know, so this, and this, and this consideration probably goes ahead of the provisional talk.
00:19:31
Speaker
Nonetheless, the idea is simple. There are three basic doors to patentability is one example of how it's been described. One of those doors is utility. Is it a useful invention? Does it work? The next door is novelty, which means is there any one publication or one thing out there that is exactly the same as my thing?
00:19:54
Speaker
And then the third one is obvious which says okay you know there isn't one thing out there that's just like my thing but if i take two known things and i put them together which anybody would do. Then that would be my invention right so those are the challenges and you have to overcome each of those challenges so you know if you're gonna put forth a wedge and you're gonna put forth a claim that says i claim wedges.
00:20:17
Speaker
Well, that means that I can bring any prior art wedge that ever existed out there, right? And all of a sudden, I can cause problems for you in the prior art sense because it's harder, you know, you haven't invented every wedge. But on the other hand, if we work together and we study the prior art, you know, we might come up with a claim that says, you know, I claim a wedge having, you know, a top face and a bottom face and a parabolic front face and, you know, an interior core with, you know, some kind of material in it, you know, and an aerodynamic tail.
00:20:45
Speaker
something like that, right? Something that gets a little narrower towards what is the magic of your particular wedge, right? And so that's where patents can kind of come in and it's a balance between trying to get as broad as right as you can and trying to just really hone in on what is the part of your structure or your method or your process that is, you know, doing the work that is really creating a unique result.
00:21:08
Speaker
So one of the things I want to talk about, Matt, because we kind of talked about this a little bit as we, you know, as we were preparing for the show today and kind of you just alluded to. So best practice, you know, it's like a big company like 3M, you know, they're taking 30% of all their revenue and putting it into R&D and they've done that for a hundred years. So a company that's generating tons and tons and tons of patents, right? Yeah, that's correct. And doing it probably the right way.
00:21:33
Speaker
you know their employees are under an NDA, non-disclosure agreement, they have a massive budget for R&D, research and development. But one of the things you said before we started recording was that to file a patent you don't need a prototype. And so kind of walk our listeners through like,
00:21:52
Speaker
you know, should they go through prototyping and that type of thing versus, you know, probably like a 3M is probably prototyping, testing, breaking, you know, numerous times. If you could expand on that, that'd be great. Yeah, absolutely. So depending upon the complexity of the invention, you know, most simple mechanical inventions and many simple electronic inventions,
00:22:13
Speaker
You know, prototyping can be optional if you can describe the invention in such a way that a person of ordinary skill in the art can make and use the invention based on your written descriptions and pictures. So if you can provide a set of instructions and those instructions are clear enough that someone can pick it up and build it or make it or use it,
00:22:34
Speaker
Then you know, you don't have to prototype now, but just because you don't have to doesn't mean you shouldn't because the thing about prototyping is sometimes you draw something out and you think it works and you're so excited about it and then you go you go talk to somebody to build it and then they're like Yeah, you could do it that way but you should really do it this way and then you realize that wait a minute There's a whole fundamentally fundamentally better way to do it. Yeah, and so that iterative process You know, it's very useful on its own but in the it but you know, but in the wedge example
00:23:04
Speaker
You know, if you can just kind of, if you can truly think of a simple mechanical invention with no moving parts and you can truly envision how that can be better. And let's say in your invention, the thing is made out of titanium. Well, you don't have to go forge titanium. Like if you know it's going to work and you know it's better and you know, no, and you've done the homework to know that no one else's has done it, then, you know, there's no obligation to prototype. There's no obligation to do any searching either. Yeah. Wow. Super cool.
00:23:33
Speaker
Yeah, now with the exception of some like again If you come up with a biological cure for cancer and you're trying to assert that this magic liquid that you made in your kitchen You know cure, you know cures kitchen cures cancer and you're trying to protect it, you know You're probably need something to back that up or you know You're not gonna pass the utility bar because they're gonna wonder if you even you know, if what you say is true
00:23:53
Speaker
And let's just touch on that real quick. I don't want to spend a lot of time there, but so then there's an FDA process in the US. Would that be different than the patent thing or is that the same? That's entirely a hundred percent separate from the patent system. Gotcha. And depending upon your product, if you're doing medical devices, which is an area I have a fair amount of experience in, then, you know, obviously if you're doing invasive surgical, you know, more advanced instruments that put human life at risk, you
Patent Licensing Strategy
00:24:18
Speaker
know, you've got to navigate a whole bunch of hurdles that are completely independent of the patent system.
00:24:22
Speaker
Gotcha. But mentioning that is an interesting thing. Think of the way people use patents, right? If I'm a small, let's say I'm a medical doctor, and I know a few things about a few procedures, and I come up with some stuff that I don't think anybody's doing, and I've been going to conferences about this stuff for a long time, right?
00:24:37
Speaker
So, if I come up with this idea, I want to put it forth, I may never have enough money individually to navigate the FDA process because it may cost millions. But I may be able to patent it, have an amazing patent portfolio, and then sell or license that portfolio to a much bigger fish who would then be able to do the FDA process and then go forth with it, such as your Boston Scientific, your Medtronics, your Strikers.
00:25:03
Speaker
So then those guys can look at you as like an independent R&D provider, basically. And you can do a deal with them. And the patent becomes the basis for that negotiation. Because without the patent, and without the patentable rights, and without the government monopoly, and all the homework that goes with that, then how do you prove you got something valuable? It's hard to negotiate with those with a lot of resources when you just have PowerPoint. It's so fascinating.
00:25:28
Speaker
So I want to go back to our Louis Vuitton example with the red bottom shoe. I think it was Gucci. Yeah, that was Louis Vuitton.
00:25:36
Speaker
That to me is like, would that be a patent or would that be a trademark? Because it's actually a physical good. Yeah, no, it's a great question. So basically there are aspects of any shoe that can be covered by both trademarks and patents, right? So in that particular unique instance, the trademark is in the coloration and the location of the color. I mean, I haven't read it, but that's kind of what it's about. It's about the look, the color and the location of the color. That's kind of what they're trying to protect, right? It's from my outsider understanding.
00:26:03
Speaker
From a patent perspective you can have a design patent that protects the shape of the shoe. Yeah, right Just how it looks not how it functions and let's say there's some kind of there's some kind of fancy thing about the shoe like some kind of You know some kind of I don't know some feature that like James Bond. Yeah
00:26:20
Speaker
Mm-hmm. Exactly. Yeah. Yeah with like a mini James Bond in the compartment who will come out and clean your shoe Something really special so then you can protect that function with a utility pad So in that regard you could protect all you have three layers of protection on that And so if somebody tries to copy your shoe, you've got three ways to basically, you know, strike back at them. Gotcha. Oh
00:26:43
Speaker
Okay, I want to jump in now to phenomenal job covering all that, by the way. That was awesome. Yeah. In a very like exciting way, by the way. So now, let's say you're on the other side, you've got the trademark, you've got the patent, probably more so the patent, because like if we trademark our business, we're probably not necessarily going to maybe license it to somebody else, more so a patent. But what is someone, you know, small guy comes up with a patent,
00:27:10
Speaker
doesn't really have the wherewithal to go start the business. It's aligned in an industry where there's already major players. Can you walk our listeners through kind of licensing or royalties and maybe the difference? Getting paid. Show me the money. No, definitely. I can't. I got to cover one more topic on patents before I can jump to that.
00:27:30
Speaker
So the the two main costs about patent that have to be considered or what kind of determines the actual cost of getting the right Once you know you want to you want to invent something you filed your provisional You know that you have one year from the filing date of that provisional to kind of do something and provide file a non provisional You've done all the homework you've done the done the searching you've done all that right and there's still a decision of
00:27:51
Speaker
how broadly around the world do you want patent rights? Do you just want patent rights in the United States? Do you want North America because that's easier to control? Do you want a global strategy in which you would go for the biggest, most industrialized countries in the world like China, Japan, Korea, the US, Europe, those kinds of things? There's a whole decision. The reason why that's relevant to licensing
00:28:13
Speaker
is because trademarks and patents can either be one country or many countries in scope. And of course, the amount of money that you can command is going to be relative to where your licenses are, where are your buyers? And so there are ways in which you can lock up 80% of the industrialized world and no one can practice your invention without coming through you. And if you're that guy,
00:28:33
Speaker
then you can command more in your royalties. You know, whereas other people say, you know what, the US is, they respect laws more than any other country. I have local control. I'd rather have 20 patents in the US covering every aspect of my invention rather than one patent going around the world. So it's just, that's all part of the balance.
00:28:51
Speaker
And so having said that then, basically when you want to go to monetize, you're trying to find people that basically either are making a product like yours or they have the manufacturing capabilities and would benefit from access to your intellectual property rights. That's what a licensee would be. And a lot of times you just kind of approach them and you can go to the store, look around for people that are selling your product, and every one of those persons or companies is basically a potential licensee.
00:29:18
Speaker
Once you have the patent, you can share it with them and you can send it to them and you can just try and establish a business contact. You don't have to have an NDA because if you're just going to talk about the filed patent and it's published, for example, then that's it. It is what it is. These are your rights. You just got to convince them to go along with it and that's it. The other part of it is enforcement.
00:29:42
Speaker
And so if you've got really broad rights and you know a company is making your product, you tried to approach them and they blew you off, then the other way to make money on it is by suing them and going that way. And even if you're going to do that, sometimes it makes more sense to license your assets out to a more sophisticated partner who can handle the litigation for you, rather than trying to invest a couple million. And so that's really what it ultimately boils down to. For a smaller investor,
00:30:09
Speaker
You're going to get a royalty stream that's 10%, 20% at most, 30% of your invention if you're lucky kind of thing. And that's just from what I've seen that's out there because you're going to have to give away a lot of it to a lot of other people along the way to help it get made and help it happen. And so you're just hoping that your invention sells enough where it all makes sense. And simpler products, simple mechanical inventions are nice because you don't even have to go that route. You can actually make it.
00:30:33
Speaker
then you can build a company that has patents and sales. So you can value the company based on those two things and now it's not a hypothetical conversation of, if you give me your factory, you know, how much you're gonna give me the thing, you know, it's, I can make it, I can sell it, then you have, that's another animal. And so that's probably, you know,
00:30:51
Speaker
the more practical route even is to kind of figure out a way, something you can make and stay in control of the longest you can. But nonetheless, if you've got a great idea and parts of it are out of your control, but nonetheless you have the R and D and you can put it together,
00:31:06
Speaker
I mean, you know, it can be a great experience, you know, and then I guess that would be the last thing I would say about, you know, how do you make money on patents or how you get value out of patents,
Matthew's Journey into IP Law
00:31:16
Speaker
right? You know, just to kind of put a couple final bullet points on it. You know, you can get value out of patents by licensing it to others, you know, either willingly through business negotiations or unwillingly through, you know, through lawsuits and stuff like that.
00:31:28
Speaker
If you build a company around these intellectual property assets, then the two things become reinforcing. The fact that you've got some sales of a protected product means you have sales at a higher margin, means you've got more products that are going out there, and increases the overall value of that company, especially if you can make it and stay fairly in control yourself.
00:31:45
Speaker
And you know and then lastly there's the intangible values of the patent process and this is true for individual inventors or for startups as well because you may think your ideas one thing and then you get to study in the prior art which by the way there's an amazing free resource called google patents.
00:32:00
Speaker
which is just a keyword based search that, you know, you can go out there and search for your idea at any time before you contact a professional. So let's say you go out there and you do that and you know, you, you can kind of figure out for yourself what other people are doing, whether it's worth proceeding with this idea or to use a, you know, some shark tank language, whether the idea is better. Just take it up, taken behind the barn and shot, because I tell you some of my ideas I'm really jazzed about and I'm excited. Oh man. And then I go look for it and there it is. And then there's no point.
00:32:29
Speaker
Yeah. Yeah. So I want to pull back. You did a brilliant job of walking through that. Here's my question. How did you get so passionate about this type of law? What do you think of your DNA kind of got you hyped up about this?
Contact Information & Consultations
00:32:43
Speaker
Well, I mean, I'm a professional engineer as well. I'm a registered mechanical engineer in Nebraska. And so I have the engineering background. And from a supply and demand perspective, when you're in law school and you have that technical background, intellectual property is just a really good fit. And so all that made a lot of sense. And I certainly found all that interesting. But I mean, I've written maybe 75, 80 pounds at this point. And what I really just enjoy is the writing process. I like working with an inventor who's got a little bit of spark in their eye, a little bit of fire.
00:33:10
Speaker
and wants to take over some part of an industry or have some ambition in that area, I enjoy the process of helping them take their idea in whatever form it comes, napkin sketches, whatever, and then turning that into a professional document with a robust intellectual property strategy and helping them to go get those rights as well as how to make money from those rights, and if necessary, working with some of my other lawyer friends to help them sue people.
00:33:37
Speaker
You know, whatever it is, you know, I've seen a lot of startups start as, you know, individual investor inventors in a garage and then, you know, with some good counsel and some persistent work and a little bit of money from friends and family, you know, they're able to they're able to truly profit from it. And of course, on the flip side of it, I've also seen people spend, you know, twenty, fifty thousand dollars on on patent assets that, you know, don't survive litigation or that never are never going to be worthwhile because, you know, they they just
00:34:06
Speaker
It's just too narrow and it's just sometimes you miss the market. Yeah. And it's definitely a little bit more risky type of investing, right? You've talked about that before we got on hit record. And so here's my question. I mean, I think there's some of our clients and listeners that will be interested to reach out to you. How do they hear more about you? How do they get in contact with you? Is there resources out there that they can maybe listen to a webinar and stuff like this?
00:34:30
Speaker
Well, first of all, I appreciate you guys giving me the opportunity today to share some of the insights. You can find me at matthewleeper.com. I have full contact information and everything there. We can schedule something there. You can send me an email. You can also look me up at my law firm, Smart and Bigger, here in Canada, which is Canada's 126-year-old firm. They've got me and they've got people with way more experience than me.
00:34:53
Speaker
This is all we do. And this is intellectual property and helping people get their protections is where I'm going to focus my energies going forth. And that's where I'm at. And then maybe coming up a little bit later this year, I've got a couple book projects and some other things that I really want to work on with respect to the drafting and all that. But in the short term, I certainly welcome contacts and I'm happy to answer questions. And I'm happy to have a half hour initial consultation with pretty much anybody so long as we can work on scheduling and see if it's a good fit.
00:35:22
Speaker
That's such a good resource for our listeners. Okay, give me one crazy story. Just hit me with one. I'm just dying to know it. You've got one. Let's hear it. Well, I mean, the craziest thing I would share about Brian is, you know, one day we were all, we were all moving in one direction. No, no, no, no. We were all moving in one direction in life and then
00:35:42
Speaker
Brian you know I had some children come into his life and he was just sorry he just manned up and was like alright guys I'm gonna go handle this business for a while maybe indefinitely and that's how I went down so I always appreciated that you know cuz not everybody makes that decision at that moment and Brian stepped up immediately took care of everything and and you know that's part of life's adventure you know
00:36:04
Speaker
that is even better than what I was. Well, the one thing I'd say too, and I've always, you know, as you grow up, you kind of lose touch, but life, you know, takes you in different paths as you kind of say them. But I've always appreciated you, Matt, and just the way you think and your intentionality and intensity, the way you pursue things. And it just came forth today, just how much
00:36:25
Speaker
you know, expertise and research and practice you've devoted to this space. So it's just been super cool to catch up with an old friend and, you know, rekindle that friendship. So thank you so much for your time today. No, absolutely. I have my 10,000 hours in on the subject of intellectual property. And I've been working specifically on the patent prosecution, patent drafting,
00:36:47
Speaker
You know side of it from the beginning so it's where the passion is and it's an area that you know I want to continue doing and and I think you know Basically, I'm just a nonfiction Technical writer or creative writer basically at the end of the day. I just happened to write patents so nonetheless happy to share my advice with with you guys happy to chat and If any of your listeners, you know wanna would like to chat further It's certainly welcome to contact me and if I can help them I know people literally all around the world who certainly can so we'll get it figured out
00:37:14
Speaker
Very cool. Huge resource. Well, we thank you so much for listening to this podcast. If you found value, please rate it. Put something on the comments. But again, thank you so much, Matthew. And yeah, you've been listening to the Uncommon Life Project. Have a great day. Thanks, everybody. Goodbye.
00:37:32
Speaker
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