Foreign Patent Filing: A Different Kind of 'Climate Watch'

• Author: Donna P. Suchy
• Position: Donna P. Suchy is chair of the ABA Section of Intellectual Property Law. She is managing counsel, intellectual property, at Rockwell Collins in Cedar Rapids, Iowa. At Rockwell Collins, she is responsible for developing and implementing patent corporate strategy, litigation, due diligence, and advising corporate management on the legal and...
• Pages: 3-10

Published in Landslide® magazine, Volume 9, Number 4, a publication of the ABA Section of Intellectual Property Law (ABA-IPL), ©2017 by the American Bar Association. Reproduced with permission. All rights reserved. This

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T he U.K. government has announced

that it will ratify the Agreement

on a Unied Patent Court (UPC)

this year. Once that happens, Europe will

become even more important as a loca-

tion for international patent litigation, as

will China and Asia. Trade agreements,

Brexit, World Intellectual Property Orga-

nization (WIPO) intellectual property (IP)

treaties, and a UPC system all signal that

change will accelerate over the next few

years. Practitioners in the United States

will increasingly need solid international

IP strategies, and a foreign ling program

is critical to this success.

Choosing a specic foreign ling

must represent a good t in order to jus-

tify the additional time and expense that

are bound to ensue. The country of focus

should offer at least one of the following:

substantial current market, current place

of manufacture, strategic distribution or

marketing hub, be the headquarters of a

current licensed partner, or be the subject

of an important well-resourced licensing

development program. On the other hand,

a poor bet for ling is any country with yet

untapped signicant potential revenue.

Filing an international patent appli-

cation is just the tip of the iceberg of

overall costs. Neither a pending U.S.

patent application nor an issued U.S.

patent automatically lead to a foreign

patent. The most popular initial ling

strategy only preserves a right to le a

foreign patent application with a claim

to a priority date. Likewise, paths to

obtaining foreign patents that begin with

a single patent application generally only

open the door to subsequent direct l-

ings to foreign patent ofces.

Cost estimates should be carefully

communicated to all involved in order to

ensure a successful program that meets

budget parameters. For example, a sim-

ple patent application based on an already

prepared and led U.S. counterpart, led

through the Patent Cooperation Treaty

(PCT), will cost over $5,000 and may

cost up to $10,000.1 This PCT applica-

tion will preserve the right to le in all

PCT signatory countries (currently 151)2

generally within 30 months3 of the U.S.

parent patent application’s ling date.

Once a location has been selected and

lings are made, operations should be sus-

tained only as long as current expectations

are understood and satised. Things can

get quickly out of hand, and it is easy to

see why. A PCT patent application pursued

through expiration of the patent (20 years)

in all 151 countries might cost as much as

$2,800,000. If that application is pursued

in only 10 economies (e.g., United States,

China, Japan, Germany, United Kingdom,

France, India, Italy, Brazil, and Canada)

through expiration, maintaining those l-

ings over 20 years will cost approximately

$200,000. If a company les just one new

PCT application per month and prosecutes

each one in the top 10 economies after ve

years, there will be 60 applications pend-

ing in 10 countries, and that company

would end up spending more than $50,000

per month just to maintain its inventions.

Other foreign ling paths are available,

some providing regional protection via a

single foreign ling based on an original

corresponding U.S. patent application.4 For

example, regional patent ofces exist for

African nations (African Regional Intel-

lectual Property Organization (ARIPO)

and Organisation Africaine de la Propriété

Intellectuelle (OAPI)), Eurasian nations

(Eurasian Patent Organization (EAPO)),

and European nations (European Pat-

ent Organisation (EPO)). These regional

paths provide fewer options but generally

have a greater initial cost. However, ling

regionally where only regional coverage is

desired will reduce overall ling and pros-

ecution cost. This is especially true where

a PCT application would normally be led

and then eventually prosecuted in a narrow

region of countries.

It is also possible to directly le

a patent application with most coun-

tries’ patent ofces5 by following the

directives in the Paris Convention for

the Protection of Industrial Property of

1883.6 This direct ling is the preferred

path for ling entities with a well-rea-

soned foreign ling policy if it is clear

which countries are to be led in and

there is no need to see how things “play

out.” A direct national ling is a reason-

able, cost-effective strategy as long as

the list of strategic countries is short and

the market plan is well developed. In

contrast, if the international strategy is

still being developed, a PCT ling will

give the company some time to see how

things develop in the new market with

its new products. In such cases, spending

the extra money may well be worth it.

Selecting countries for foreign l-

ing usually begins with how a company

intends to use its patents. Factors to

consider include product markets and

competitor challenges, defensive posi-

tions, product type (e.g., pharmaceutical

or software program), corporate reputa-

tion, and an active licensing program.

A review of corporate patent expecta-

tions, product plans, and goals should

be addressed as the initial candidates

for ling are weighed. Considerations

include (1)whether the invention is a

game changer for a whole new mar-

ket or simply another patent application

in an already under-exploited portfolio;

Donna P. Suchy is chair of the ABA Section of Intellectual Property Law. She is managing

counsel, intellectual property, at Rockwell Collins in Cedar Rapids, Iowa. At Rockwell

Collins, she is responsible for developing and implementing patent corporate strategy,

litigation, due diligence, and advising corporate management on the legal and operational

implications of IP laws. She can be reached at donna.suchy@rockwellcollins.com.

Perspective

By DonnaP. Suchy

Foreign Patent Filing: A Different Kind of “Climate Watch”

Continued on page 8