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2013.02

 The Inventor's Mentor

February 2013

SMALLER IS BETTER - ARE YOU A MICRO ENTITY?

 
  
The America Invent Act is changing patent law from first to invent to first to file. I have discussed this Act in previous newsletters (April, May and October 2011) and described why it arguably may not benefit American innovation.  This new law, however, carries a silver lining for the very small inventors.        

The old law, effective until March 19 considers two classes of inventors, large entities who are required to pay the regular patent fees and small entities who are required to pay only half of most of these fees. For example, the cost of filing a utility patent is currently $1260 for a large entity. This amount includes the filing fee, the search fee and the examination fee. The same patent filing currently costs half of that amount or $630 for a small entity.           

A small entity is defined as an individual or an organization not exceeding 500 persons, or a non-profit organization. For years, small inventors have been complaining that organizations that include 500 persons are large from their point of view and that the US Patent Office should offer  special deals for the small individual inventors.          

The new law grants their wish. As of March 19 a new classification comes into effect. Micro entities will be required to pay only one quarter of the full fee amount. To qualify as a micro entity one must:           

·         Qualify as a small entity;

 

·         Not have been named as an inventor on more than 4 previously filed patent applications;

 

·         Have a gross income less than 3 times the median household income in the preceding calendar year; and

 

·         Not have assigned, granted, or conveyed a license or other ownership interest in the application to an entity having a gross income in the preceding calendar year exceeding 3 times the median household income.

 

Currently the median household income is approximately $50,000. Therefore if you are an individual inventor filing your first patent, you are keeping ownership of your invention and your income last year was less than about $150,000, you are considered a micro entity and you will be charged only one quarter of the regular fees.

 

It is important to note that as the new law kicks in, the fee schedule is likely to increase. However, as an example of the benefit to the small inventor, given the current fee schedule of $1260 for filing a utility patent application, a micro entity would only be charged $315. Perhaps this discussion of micro entities proves that smaller is better.         

Information about USPTO fees is available at http://www.uspto.gov/about/offices/cfo/finance/fees.jsp and frequently asked questions about fees can be found at http://www.uspto.gov/main/faq/index_feefaq.html.

 

 

Other Ways to Save Money

Inventors have at their disposal other means to cut their costs. For example they can file a provisional application that will give them protection for one year. This topic is discussed in the December 2011 newsletter. The filing fee for a small entity is currently $125 and will go down on March 19 for micro entities.

Another approach to economize is to follow the low risk, step-by-step approach described in the August 2011 newsletter.

 

For archived newsletter and a lot of information for the small inventor go to: www.patentsandventures.com.  

If you have any question you can contact me at (858)259-2226 or email me at glevy@patentsandventures.com.

This newsletter should not be construed as being legal advice.             ©2013 by George Levy

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