Once again we have a lawyer on the show today, Anthony Famularo from Rosenbaum Famularo, The Amazon Lawyers. Today we’re going to talk about patents for Amazon and trademarks.
We’re going to start with definitions. People tend to get confused with these words, myself included, so I thought it would be good to define them first.
The biggest misconception, when it comes to IP, is patents. People can generally understand copyright and trademarks, but don’t have a good grasp of IP. They have a hard time trying to interpret patent laws by themselves.
Patents are a government protection that gives you exclusivity for your inventions. To get a patent, your invention must be new, useful, not obvious. For sellers, there are two types of patents for Amazon you need to worry about. Design patents, and utility patents. A utility patent covers what you think of as an invention. The useful part of an invention. A design patent covers the appearance or the non-functional aspects of an invention. For the best protection, you will want to register for both.
There are many misconceptions about patents. One is that people will confuse trademarks with patents. They think that because they private labeled their product that it protects them from other people’s patents for Amazon. Patents are government issued and protects you from having your products used by others. Just because you trademark and private label your product, doesn’t protect you from someone taking your idea.
An example of a utility patent would be a phone case with a light on it. A utility patent would protect the case itself. It would make it illegal for someone to make a phone case with a light on it. A design patent would protect the look of it.
One fear many new sellers have is violating a patent. There is a fear that you might inadvertently infringe on another’s patent when you source from China. Before you spend a lot of money on product development, you want to perform a clearance search. You can search on your own and find out that way. A good resource would be https://www.uspto.gov/. Then you can have a law firm do a preliminary search. They will attempt to find any obvious products that would have a patent. If that doesn’t find any issues, you can then make the decision to conduct a more thorough check.
It might be adequate to use https://www.uspto.gov/ if you’re coming out with a private label product. If you have the money, it is best to have a comprehensive search done. However, many sellers that are just starting out may not have the resources for that. They should at least attempt to get a preliminary search. You should be able to get it for under $1000. It’s worth the money to avoid the risk.
With trademarks, the https://www.uspto.gov/ would be a good resource. It will tell you if there are any current registrations, applications, or abandoned marks. If you are looking to trademark your brand, it’s a lot easier to look up the brand than it is to find these patents. The next step, if you found that there won’t be an issue, is to register your trademark. You will want to keep everything confidential to avoid it getting public and running the risk that someone beats you to it.
The biggest risk is the potential for damages that comes with not doing your homework. If you infringe on someone’s patent, they probably won’t care that you’re a new seller. If you do infringe on a patent, the first thing is that you will receive a cease and desist letter. Most of the time, if you stop selling the product, the other party will drop it. It’s not worth it to them to spend the money on litigation.
It is a much different case if you ignore the letter. They can go after you for wilful infringement. They can also try to go for punitive damages beyond the money they lost. Hopefully, you won’t make the mistake of ignoring the letter. In that case, you may be forced to pay what lost profit.
Please bear in mind that this is worst case scenario. Don’t let this scare you off. It may sound scary we’re only talking about the rare occasions. You can protect yourself, in case this actually happens to you, with General Liability Insurance. We recently discussed this with Ashlin Hadden.