General terms for engagement in U.S. patent prosecution
This letter proposes an attorney and client agreement between our law firm, Clark & Bellamy, P.C., and the undersigned client. The letter confirms the understanding between attorney and client concerning our representation of a client who engages our firm for patent prosecution with the United States Patent and Trademark Office. The terms and conditions of this letter become effective upon receipt and depositing of the client’s retainer or advance payment.
1. Nature of Services. Our firm will provide you with patent law legal services, concentrating initially on pursuing the patenting of your invention (either utility or design) and such other matters as you may refer to us from time to time that pertains to patent prosecution. To further acquaint you with the process and cost of acquiring and maintaining a U.S. patent, we provide examples below of the steps, legal fees, and expenses in typical utility and design patent prosecution matters. Patent prosecution proceeds in stages. Some of these steps are optional, and some are mandatory. You may elect to stop at any point in the process and not incur legal fees for future phases.
For a Utility Invention:
a. Completion of Reduction to Practice. The Patent law says that the creator of an invention is not an “inventor” until he/she has “reduced to practice the invention” (i.e., built a prototype and documented its benefits. Or, without having made a prototype, the inventor has recorded the invention in its entirety with an “enabling” disclosure.” An enabling disclosure describes the concept in enough detail to identify the various parts or elements of the invention and give the specifications for those features that are important to the functionality of the method or apparatus. If possible, the inventor provides one or more line drawings of the invention and labels these to identify the invention’s various parts. The enabling disclosure allows a person with ordinary knowledge in the technical area to make and use the idea without undertaking extensive experimentation to resolve any technical details not adequately provided in your disclosure. If you do not meet these requirements of “inventorship” and if you wish to do so by “making an enabling disclosure,” our first task will be to assist you in this documentation step. Because the amount of work required at this step can vary widely, it is difficult to quote a typical legal fee for this step. However, we hope that the costs of this step will be $2,000 or less.
b. Novelty search. We may perform a novelty search to assess whether patent coverage is available for your “invention.” The novelty search would include comparing a hypothetical claim to your invention against a search of patents on file in the U.S. Patent and Trademark Office (USPTO). At a minimum, the search includes an oral report of our findings. Patent Search Fee – we typically cap the cost of a novelty search at about $2,000, dependent on the extent of the search. Beyond that, the returns diminish substantially in most cases. Note: if available, you should give us a copy of any previous search. If your search is valid and can reduce our time and effort – we will certainly reduce the cost of our search. If your novelty search results are negative, our representation of you in this matter might logically conclude at this step.
(A) Option 1 – Two-Part Filing Option:
1. Provisional Patent Application (PPA), and
2. Regular Patent Application (RPA) filed within 12 Months of the PPA for a Utility Patent
(i) Preparation and filing of a Provisional Patent Application (PPA): Legal Fee – approximately $3,000 – $5,000. Our fee depends upon the effort required to describe your invention fully. The work is a function of your invention’s complexity and the completeness of the written disclosure that you provide. The legal description (i.e., a “claim”) is not a required part of a PPA. Expenses – USPTO Filing Fees – about $130, assuming you are entitled to pay “small entity” fees, plus costs for necessary line drawings (e.g., $100/sheet). Note: In rare circumstances, one may wish to file a PPA solely to lawfully put a “Patent Pending Notice” on all materials related to the invention and not to claim priority to this PPA’s earlier filing date – in this situation, we may reduce these legal fees.
(ii) Preparation and filing of a U.S. regular utility patent application (RPA): The RPA uses some of the specifications of your PPA filing and asserts the benefits of the PPA’s early filing date. Legal fee – approximately $4,000 – $13,000, depending upon the complexity of your invention. E.g., the cost of a simplistic mechanical product may be about $5,000. The fee for a complex machine or chemical process may increase to $15,000 or more and potentially include the retention of an expert to assist. We determine the price based on a projection of the effort required to claim your invention fully. Expenses – USPTO Filing Fees – about $800, assuming you are entitled to pay “small entity” fees, plus possible costs if additional line drawings are prepared (e.g., about $100/sheet).
(B) Option 2 – Dispense with PPA and make first filing an RPA
Preparation and filing of a U.S. regular utility patent application (RPA). Legal fee – approximately $6,000 – $15,000 depending upon the complexity of your invention (e.g., for a simplistic mechanical product – $6,000; for the compound machine – $15,000) and the effort required to claim your invention fully. Expenses – USPTO Filing Fees – about $800, assuming you are entitled to pay “small entity” fees, plus possible costs, such as additional line drawings (e.g., about $100/sheet) and assuming the applicant is a “small entity.”
d. USPTO responses. Response to USPTO Office Action(s), which gives the USPTO’s feedback on the Regular Patent Application (A necessary step in >95% of utility applications): Legal Fee – The amount of work required at this stage is a function of the USPTO’s feedback. Quoting estimated legal fees for this step is complicated. Recognizing that a response to more than one office action may be required, we hope to hold total legal fees to $10,000 -$15,000 or less, but the total investment and risk vary.
e. Notice of Allowance. Filings in response to a Notice of Allowance and the subsequent issuance to you of a patent: Legal Fee – approximately $800, Expenses – USPTO Issuance & other fees – about $1,200 (assuming the patentee is a “small entity”).
f. Maintenance Fees. To extend the term of the life of your patent to its maximum of 20 years, you will need to pay “small entity” maintenance fees of about $800, $1,504, and $3,080 on the respective 3rd, 7th, and 11th year anniversaries of the date of issuance of your patent (assuming the patentee is a “small-entity”). The USPTO changes the amount for renewal of patent rights, usually by increasing the costs every few years.
g. International applications. Internationally, patent application filing depends upon your interests in protecting an invention in other nations. Within twelve months of filing a U.S. patent application or your invention’s public disclosure, the law requires that you apply for your foreign patent rights – typically by submitting what’s known as a Patent Cooperation Treaty (PCT) Application. Clark & Bellamy, P.C. currently refers clients to another law firm to handle international applications. You should notify us at least two months before the application deadline if you desire to pursue international patent protection so we can help you with a referral.
For a Design Invention:
a. Preparation and filing of a U.S. Design Patent Application: Legal Fee – approximately $4,000 – $4,500 depending upon the effort required to describe and claim your invention fully. Expenses – USPTO filing fees of about $480, assuming you are entitled to pay “small entity” fees, plus possible expenses for necessary line drawings (e.g., about $100/sheet).
b. Response to USPTO Office Action(s), which gives the USPTO’s feedback on the application. Response to Office Action is necessary for greater than 90% of utility applications but less often for design applications. Legal fee –the amount of work required for response to an Office Action is a function of the USPTO’s feedback. Quoting legal fees in advance for this step is inaccurate without knowing the issues. Further, recognize that the prosecution of an application might require a response to more than one Office Action. We hope to hold legal fees for responding to an Office Action to about $2,000 or less for each reply.
c. Allowance and Issuance: Filings in response to a Notice of Allowance and the subsequent issuance to you of a Patent require additional fees; Legal fee – approximately $500; Expenses – USPTO Issuance Fees – about $510 for a small entity.
d. Maintenance Fees – there are none for a design patent whose life is 14 years from its issue date.
e. Foreign Application. Depending upon your interest in international patent protection, within six months of filing a U.S. patent application or your invention’s public disclosure, you must apply for your foreign patent rights – typically by making one or more Paris Convention (PC) filings. Clark & Bellamy, P.C. currently refers clients to another law firm to handle international applications. You should notify us at least two months before the deadline if you desire to pursue overseas patent protection so we can help you with a referral.
1. If the USPTO grants a patent to you, you must periodically pay maintenance fees, or the rights conferred will lapse. Generally, payments are due 3½, 7½, and 11½ years after the date of issuance. We will attempt to send maintenance fee reminders to your last known mailing address or email address as a courtesy to you, even though our attorney-client relationship has concluded. We strongly suggest you hire a commercial service to manage maintenance fees for you or place reminders of maintenance fees in more than one calendaring system. Failure of the patent holder to personally monitor maintenance fees can result in losing patent rights.
2. General Patent Counseling Services: General patent counseling services provide advice on all matters relating to patent enforcement, marketing, and licensing of the invention. Legal Fees: charged hourly unless we set a separate flat fee in writing; see below.
Fees. For the above-listed steps and our general patent counseling services, we bill for our services monthly, by retainer, or by advance payment. Hourly fees are calculated in 0.1-hour increments using the hourly rates set forth below:
Attorneys and Rates
Brian D. Bellamy $ 400.00
Paralegal $ 150.00
We reserve the right to increase our hourly rates from time to time. It may be necessary for additional attorneys of this firm to perform work on other matters that you may refer to us.
3. Fixed or flat fees. We offer some of our services on a fixed fee basis. In some cases, we also quote fixed prices for specific work. We confirm fixed fee services in electronic or other written communication; without such confirmation, all fees are subject to being billed hourly. For the above-listed steps and our general patent counseling services, unless otherwise noted in writing, we work on a time and materials basis. Even if we have estimated the time or cost requirements on a matter, provided a budget, or otherwise responded to a request for a range of expected fees and costs, there is no guarantee that such estimate, budget, or another amount will be the actual cost incurred. We often cannot anticipate when and what action the USPTO and foreign patent offices will take in reviewing and processing any patent applications that we file on your behalf.
4. Retainer. Before we can provide our patent law services, you must augment the retainer amount that the firm currently holds for you. The amount of this additional retainer payment will be a function of the magnitude of the initial assignment undertaken for you. The amount of this additional retainer will typically be in the range of $1,000 – 5,000 and is payable at the inception of our work for you and will usually be due at the time that you indicate your agreement with and acceptance of these terms for providing our patent law services to you. Money remaining in escrow returns to you after our representation and payment of all fees and expenses. We maintain retainers in an Interest On Lawyers Trust Account (IOLTA). Under applicable law, our bank pays all interest on such funds to Legal Aid. If, at the completion of our engagement, you have remaining funds in our escrow, we will promptly repay them to you upon request unless we have an outstanding balance. If you have an outstanding balance, we will first pay our invoice from such remaining funds. We may (as authorized by this agreement) use your retainer to pay any invoice we have issued. We will make those deductions typically as we complete work each month, and we will report such use on your next invoice.
5. Our obligations to you: If you are executing this letter as a representative of an entity, you represent that you have the authority to bind your entity. You acknowledge, and we agree, that our engagement is with the entity only and not with you individually (if this sentence applies, “you” or similar pronouns in this letter refer to the entity). We will only perform the work you request. We will keep records of our work. We will communicate with you regarding our services, especially when you request information. We will comply with our ethical and legal obligations to you. We will use our best effort to reach a successful conclusion to any matter in which we are engaged. We encourage communication, and if you ever feel we are not meeting these obligations, you agree to let us know.
6. Your obligations to us: You agree to keep us informed and disclose all material facts related to matters in which we are engaged and to pay our fees.
7. Expenses. If we incur external costs for you, such as filing fees, delivery charges, and similar expenses, you agree to pay those expenses. We do not mark up any costs we incur, and we do not charge separately for paper, fax, or phone expenses. For significant expenses, we may request that you prepay those costs or pay them directly. We may charge a separate expense fee for online computer research when we use services like Westlaw, Lexis, or similar services.
8. Invoices and payments. We will render invoices for services and expenses periodically (typically monthly), and you agree to pay our fees and costs within 30 days of our invoice. We are entitled to our fees regardless of the outcome of the matter.
9. Interest. If You do not pay our fees within 30 days of the date of our invoice, we may charge interest on the fee portion of the bill of up to 12% annually, compounded monthly.
10. Confidentiality. We are under the highest fiduciary duty of care to maintain attorney and client confidentiality. We will comply with this duty unless you expressly or impliedly waive it.
11. Electronic communications. We often communicate electronically, and you agree to communicate using electronic communications.
12. Records retention, file security, and paperless files. We operate paperless, meaning that we store your records electronically. We use onsite and off-site email storage. We use online banking, and we use online and cloud-based document storage. While we use reasonable effort to maintain such records securely, our vendors represent to us that they will also make such reasonable efforts. We advise you that no computer system is free from the risk of a data breach.
13. Termination. You may terminate our representation at any time on notice to us. We may terminate our attorney and client relationship with you, subject to the Georgia Rules of Professional Conduct, and any applicable rules of the Patent & Trademark Office, upon written notice. On termination, you agree to pay all accrued fees through the date terminated. As long as you pay attorney fees, we will make electronic records available by electronic means at the end of our representation.
14. Acceptance. Retaining our services by paying any retainer or advance fee acknowledges your electronic receipt of this letter and consent to its terms.
Fees and information are current as of 10/01/2022.