Patent Exploitation Strategies

Summarise with: ChatGPT Claude Perplexity Microsoft Copilot

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Table of Contents

• What is exploitation?
• Who has rights to exploit?
• Are there geographical limits?
• How to exploit?

A patent is a set of exclusive rights granted over any device, substance, method or process that is new, inventive and useful (an Invention), for a limited time after a successful application process. Similar to trade marks, it is a registrable right granted by the country of registration. An applicant for a patent has to disclose the substance of the invention, making the information available to the public. Consequently, some inventors make the business decision not to disclose their patents, instead opting to keep their invention confidential as a trade secret. If you are granted a patent, you have exclusive rights during the patent term to exploit it. Exploitation doesn’t mean a general licence or assignment of your rights. Below we discuss different patent exploitation strategies.

What is exploitation?

Patent exploitation confers different meanings depending if the patent is over a product, process or method. For products, patent exploitation refers to the exclusive right to make, hire, sell or otherwise dispose of the patent, or offer to do any of the above.

For process or methods, patent exploitation refers to the exclusive right to use the result of the process or product to do any of the above acts (attributable to products).

Who has rights to exploit?

Under the Patent Act, a person with a grant of patent or another person (with authorisation from the person with a grant of patent) holds the rights to the patent.

Are there geographical limits?

Your rights to exploit a patent extend across the patent area, i.e. Australia.

How to exploit?

As the owner of the patent, you can assign or licence your rights under patent.

Assignment refers to transferring (often by selling) your rights entirely at a particular point in time. This means you can assign all your patent rights to another person or entity. But remember, your patent rights extend across all of Australia and you may not want the other person or entity to have the right to exploit your patent across all states and territories. You might want to keep the right to exploit in some states and territories (for example, New South Wales and Queensland), and only assign rights to exploit in other states. This is possible and often can be an important commercial decision. Once you assign away your rights under patent, you may not get them back. If assignment does occur, you must put it in writing and register such an assignment with IP Australia.

Conversely, if you are in receipt of an assignment, you want to make sure the assignment rights are appropriately described and reflect what you and the patent owner agreed on (for example, you are assigned patent rights in Victoria, Tasmania and South Australia and not the other states). You would also make sure such assignment is registered with IP Australia, otherwise you risk the assignment not being valid.

The other mode to exploit your rights under patent is to licence your rights. A licence is different to assignment because the former permits another person or entity to do specific acts only for a limited period of time. Once that time period is over, the rights granted under a licence will revert back to the patent owner. Licence rights can be exclusive (only the person being granted the licence has the right to do certain acts) or non-exclusive (the person being granted the licence, the owner of the patent and whomever else is in receipt of such a licence have the rights to do certain acts).