Licensing

Reality Check

Getting your innovation out into the marketplace can be a tricky endeavor, and USC Stevens is here to help you navigate those waters. We are bridging the gap between very early stage and unproven innovations and companies that are worried about next quarter's profits, not next decade's product or service.

It is not unusual for a basic idea from a university to take 7 to 12 years or longer to get to market. So sometimes, even without immediate response from industry, we may still choose to protect the innovation for a few years while other markets factors, business models, and industries evolve to enable the innovation to impact society.

The unique advantage that USC Stevens offers is a deep and broad network of knowledgeable industry experts to help us determine the best course of action for your innovation.  

Patenting

The Patent Process, We Need Your Help!

As stated in the USC IP Policy, when an innovation is successfully licensed and royalties exceed expenses, net proceeds are shared with the inventors. Sounds pretty good, eh? But there's a catch. You have to be prepared to spend time with us and the patent attorneys to get your patent application on file. In addition, we almost always need inventors to act as subject matter experts to help us with negotiations with potential licensees, and often rely on their leads to successfully find a licensee.

To patent or not to patent?

Literally, just about everything that crosses our desks at USC Stevens is patentable, but we must also look at several other factors before making a patent investment. The licensing associate assigned to support your case will combine his or her experience with market data and trends, potential patentable subject matter, direct industry feedback, the USC Steven's expert community and your input to proceed toward making a patent filing decision.

We ask, for example, if a patent is granted, is it enforceable? And if so, would a typical university royalty justify the millions of dollars it may take to protect associated rights? Other factors in determining whether a patent should be filed include how crowded the general area is with other patents, how long it will take to get a product to market, and whether the patent will still be in within its legal term when the related product hits the market and during the peak of the product life cycle?

It typically takes about five years for a patent to be granted and average cost is around $25,000. (United States only; additional countries would have additional costs that could run hundreds of thousands of dollars.) The patent office typically rejects all patent claims in the first "Office Action" and it takes about 18 long months to hear this "bad" news. The entire patenting process can be somewhat dry, is always complex, and depends on numerous factors beyond the scope of this website. But the following might be helpful.

Inventorship

When you have an idea that you think might be patentable, write it down in a notebook along with the date and time, and have a colleague witness it. Not only is this good thing to do generally, it is required by USC policy and many sponsored research agreements. This will secure and document a conception date and may be critical in establishing inventorship.

Under United States patent law, the lawful inventor is the one who first conceives and reduces to practice an invention that is useful, non-obvious and not known by others. 

In this simple statement there are a truckload of scenarios and complications. For example, the filing of a patent application is considered a practical reduction to practice, meaning that an inventor does not even have to actually build a prototype or test the concept to obtain patent protection. Further, an inventor doesn't even have to know how to make his or her invention!

However, there are huge risks to just filing a patent without at least building a prototype or computer model. If it doesn't work, for example, the patent is invalid.

Dealing with foreign countries becomes even more complex. For example, in foreign countries it is often the entity that first files an application that is the lawful inventor, and you don't even have to be an inventor! These different systems do ultimately offer similar protection. 

The point: The patent and licensing world can be very complex, so talk to us, and let us help you protect your ideas if possible and necessary.

Loose Lips Sink Ships. What should I not do?

We are an academic institution. We are in the "business" of generating new ideas and disseminating existing knowledge. So, we will never stand in the way of publications and other forms of knowledge dissemination.

However, due to funding obligations, your protection, and ultimately the public good, your publication might have to be delayed for some period of time, but typically never more than about 90 days.

Why? For one, it may be a legal obligation of the funding agency that supports your work. And further, to secure international rights you can not publicly disclose your invention because this immediately bars patent protection in most foreign countries.

What is a public disclosure?

This can be somewhat gray, so you should check with us. Possible publication could be a public disclosure at a conference which includes a written description, or the submittal of a proposal for funding.

So before you start bragging about your great idea -- anyplace, anytime, anywhere -- talk to us.

 
Marketing Outreach

If we need to market your invention, we will conduct market research to find a list of target companies.  We will contact potential partners and disclose non-confidential information.  A non-confidential description could also appear on the USC Stevens web site.

After we pique interest, we will provide the potential licensee with additional information.  If the information is confidential, we will have the company sign a non-disclosure agreement (NDA).  In some instances, the company will need access to a sample of your invention or some tangible research property to evaluate the invention for licensing.  Such material is transferred under a Material Transfer Agreement (MTA.)  After this phase, if the company determines it is interested in a license, we will start to negotiate terms with the company.

License Negotiations

We will develop some preliminary terms that we may propose to the potential licensee. This is almost always done with input from the innovator.

The valuation and negotiation process is dependent on many factors including industry-specific norms, and are further influenced by potential licensee's commercialization plans, industry standards, similar licenses, and whether more than one party is interested in a license.

Do not discuss financial terms and conditions of a license with the potential licensee prior to consulting with USC Stevens. Inappropriate expectations up front can damage a deal.

Royalty Distribution

Net royalties are shared with inventors, with the share depending on their date of commencement of USC employment. The royalty sharing policy is described in detail in Section 4.1 the USC Intellectual Property Policy. For additional information, please refer to Section 4.1 of the FAQ to the Intellectual Property Policy.