Early in my career, I was offered an opportunity to work with the electronics engineering client of a litigation partner in my firm. We’ll call the client Watt’s Up, Doc? Industries Watt’s Up designed custom and semi-custom electronic safety systems for various industries. . With some frequency, Watt’s Up modified a custom design into a more generic form to solve a safety issue in other industries and sold this more generic form to multiple customers.
In one case, they created a custom design and sold it to a customer and then created its generic version approximately a year or more later. The generic version went on sale shortly after it was finalized. While they were doing all this, one of their competitors, who we’ll call Ohm My! created a similar device that solved a similar technical problem within a safety system.
Unlike Watt’s Up, Ohm My! filed a patent application that issued a year or two later. Ohm My! then brought an infringement action against Watt’s Up’s more generic version of their original custom design made several years earlier.
Watt’s Up’s initial custom design represented prior art since it was made and sold before Ohm My!’s patent application was filed. The details of Watt’s Up’s custom design was not readily available to the USPTO or to the competitor even though it was publicly in use by a Watt’s Up? customer.
A few years passed and Ohm My!’s infringement case proceeded to trial. Watt’s Up’s defense was that Ohm My!’s patent was either invalid because the initial custom design made the invention not novel or if it was novel in some way, it was not applicable to Watt’s Up’s generic system which was essentially similar to the initial custom design. Watt’s Up did not care which of the two outcomes was accepted by a court because they would not be infringing on Ohm My! either way.
To prove their defense, Watt’s Up needed to produce testimony and documentation regarding the initial custom design, including the dates they designed, prototyped, and sold the system to its customer. The defense also needed to provide testimony and documentation regarding the more generic version as well as expert testimony regarding the similarities between these two versions of their products.
Complicating this defense was the fact that key employees were no longer employed by Watt’s Up and conclusively proving the dates that design events occurred was problematic. Any engineering business, regardless of size, would encounter similar issues in proving what their engineers did 5+ years prior regardless of how helpful their employees were to this process.
At trial, Watt’s Up presented their evidence during a couple weeks of trial. The court found that Ohm My!’s patent was not valid as it was not new when compared to Watt’s Up’s initial custom design sold before the patented generic was created. The cost of preparing for a multi-week trial, doing fact-finding, and using expert witnesses was substantial. It was an expensive win for Watt’s Up.
Later, my litigation partner and folks from Watt’s Up were discussing the trial results over a meal. He told Watt’s Up that had they spent just a few thousand dollars preparing and filing a patent application when the initial custom design was made and sold, they would have saved the high cost of the trial. Even if they went to trial, the patent application document itself would provide all of the technical details regarding their design and an indisputable filing date when the application was submitted to the USPTO – essentially providing evidence of their defense at trial at a significantly lower cost.
If Watt’s Up had filed their own patent application for their custom design, Ohm My!’s patent may not have issued as the examiner at the USPTO would likely have seen the Watt’s Up’s earlier patent application and used it to reject or significantly limit the scope of Ohm My!’s claims. Even if the examiner missed Watt’s Up’s application, Ohm My!’s lawyer, when presented with a copy of Watt’s Up’s application with its prior filing date, would likely have advised Ohm My! not to spend money to bring an infringement claim that it would ultimately lose.
Watt’s Up learned an expensive lesson regarding the value of a patent application/issued patent. In this case, a patent for their product would have served as protection against an unexpected, costly lawsuit. Ohm My! v. Watt’s Up reminds me of an old auto parts commercial. A car mechanic explains to a customer that if he had done routine maintenance on his car using the auto parts company’s product, he would have eliminated the need for an expensive engine repair. The mechanic ends the commercial with a line that’s applicable to most inventors about patents: “You can pay me [patent attorney] now or you can pay me [patent attorney] more later.”
Unfortunately, too many clients learn this lesson the hard way.