Toevolution

In the twenty-first century, it is harder than ever to define intellectual property rights. So it comes as no surprise to see businesses spending a good amount of their income to ensure its defence and proper application. In addition to defending your patent rights, it's critical not to violate anybody else's, as this could impede the smooth expansion of your business. In order to investigate any potential for infringement, businesses now routinely undertake clearance analyses using the available tools. One such tool used by businesses all around the world at various phases of product development is freedom-to-operate (FTO) search. Having said that, the query "what is FTO search and how to do it?" frequently stumps a novice professional.

FTO searches, also known as clearance searches or infringement analyses, look to see if a product or a procedure violates any claims made in an active patent. Additionally, it aids in the identification of potential barriers that would require licencing or invalidation, directs product design choices, and unearths design-around technologies.

This article provides a thorough analysis of FTO search and how it has evolved into a tactical instrument for an organisation to stay on top of the game.

How a Patentability (Novelty) Search varies from an FTO Search?

Although a quick glance reveals no distinction between an FTO and a patentability search, the distinction  is significant and fairly important for businesses. A patentability search is carried out to determine whether a new invention is superior to prior art that already exists. An FTO search, on the other hand, focuses on determining the likelihood (or working method) that a product will violate a third party's patent. Being a negative right, a patent right does not by itself offer market access. This indicates that a patent is not a guarantee against the infringement of third-party rights, which is exactly why it is necessary to do a freedom to operate search/analysis.

Different Approaches Adopted by Organizations for FTO Analysis

1. Analysis of Particular Competitors: Companies frequently carry out competitor-specific searches to make sure their goods don't violate the intellectual property of their rivals. The least that businesses can do when there is a high likelihood that rivals will protect identical ideas is competitor-specific analysis. The reasoning also makes sense because receiving a lawsuit notification from a rival is more likely than from a corporation with a different main business but related patents. The search results in this analysis show that the competitor is the lone owner of the patents. The investigation's conclusion is to ascertain whether the competitor's patent rights may make it difficult to commercialise the service or product. There is still a chance that patent rights held by non-competitors will present an issue from an infringement perspective, even though this type of FTO analysis gives a reasonable indication of the risk of joining a market.

The second form of FTO analysis focuses on assessing third-party patent rights relating to particular features or aspects of a new good or service. Other qualities are not taken into account for analysis because they do not intersect with a company's interests. Consider a new car engine with self-diagnostic features as an illustration. In this instance, a feature-specific study would involve looking at third-party patents in the field of self-diagnostic engines. The other factors, however, such operational traits and engine design, are disregarded. The analysis's findings point to disputed patents covering a single technical feature, namely the new product's self-diagnostic capabilities. This kind of FTO study has limits because other, unidentified patent features can end up being problematic despite being cost-effective.

3. Thorough FTO Study: This FTO analysis encompasses all patents (competitor and non-competitor) and their commercialization-relevant aspects. A thorough FTO analysis offers the most comprehensive information and, hence, the assurance of non-infringement when marketing a good or service. Despite being efficient, it requires a significant investment of time and money.

Along with knowing the different FTO search methods, it's crucial to understand when and by whom an FTO search should be conducted.

Who Should Conduct an FTO Search and When?

Time management is essential in an FTO search, just like it is in other facets of life. Organizations frequently aren't sure when to conduct an FTO search.

1. Early in the Product Development Cycle: There are several advantages to doing an FTO search at this stage of the process or product development cycle.

• During the early stages of product or process development, it assists in choosing the best allocation of resources and minimises cost effects.
• reduces the likelihood of lengthy and expensive future litigation and also emphasises strategic licencing alternatives in the event of potential infringement.
• enables design changes early in the lifespan of developing a product or method to avoid any enforceable patents.

2. Prior to a Product's Market Launch: Before releasing or continuing a product, doing an FTO search is the best course of action if you want to reassure current shareholders and investors. It provides an additional level of assurance to support the commercial decision to introduce or maintain the product line in the marketplace. The FTO search at this stage may also reveal possible untapped markets that the invention could tap into by being used, sold, or licenced. If the FTO outcome is adverse and there is a strong likelihood of litigation, the organisation may take the following actions:

• Contact the company that owns the patent to discuss purchasing or licencing
• Object to or declare the relevant patent invalid
• Change the product to reduce the chance of potential infringement
• Reconsider your plans to introduce or launch the product into the market.

3. Following the Grant of a Patent: After receiving a patent grant, conducting an FTO search enables one to determine how the state of the art has changed since the invention's disclosure. Additionally, it aids in the identification of rivals and potential instances of patent infringement that might be defended by using the rights to awarded patents to enforce them. On the plus side, a start-up finds the FTO report essential when seeking finance. The report's findings aid investors in understanding an idea's potential and determining the likelihood of future infringement.

It's crucial to know who should carry out an FTO search after you've established the ideal time to do so.

Who ought to carry out an FTO search?

To find out if it has permission to use or operate an innovation in a certain country, any company or person may conduct an FTO search. Additionally, when organising these events, individuals or groups may also carry out an FTO search:

• Introduce new items
• Examine potential new licences
• enlarge your market
• Prior to obtaining start-up capital and investment (for start-ups)
• Before making a significant investment in product development

We've already covered when to conduct an FTO search and who should conduct it, so now let's talk about the consequences of not conducting one.

What Happens if an FTO Search Isn't Conducted?

Before releasing a product on the market, a business will do an FTO search as part of its due diligence process. It would be fascinating to know what would happen if a company with a low ROI, minimal investment, or high risk tolerance decided not to conduct the clearance/infringement analysis search. The risk of not doing the search carries potential repercussions.

One. Reputational harm When your company is named in a patent infringement litigation, it creates severe reputational harm that might take years to repair. The violation calls into doubt the organization's moral character and integrity. Therefore, protecting your organization's reputation by reducing infringement claims is essential even having a good track record.

2. Development Cost: It takes years of arduous labour and research to produce a new product. You are forced to postpone the product launch and commercialization of the technology due to a patent infringement litigation and subsequent favourable judgement for the litigant. As a result, the money spent on developing the idea and creating the invention is wasted.

3. Product or Service Withdrawal: Unless expressly authorised by a court of law, you are not entitled to proceed with the product or service introduction in the market while facing a patent infringement litigation. The time, money, and personnel used for the product or service launch are wasted resources. In addition, the product or service removal attracts unwelcome media and consumer attention.

4. Legal Fees: The legal fees for a contested patent infringement can go into the millions of dollars. Such a big sum can deplete your cash reserves. In addition, the time and money spent handling lawsuits can have a significant negative impact on your organization's ability to expand.

You must conduct an FTO search depending on your needs and budget in order to minimise the risk mentioned above. However, there are traps for not finishing it or doing it incorrectly, which raises the risks.

Five Common Freedom to Operate Analysis Pitfalls

1. Myopic Claim Setting: Focusing exclusively on current risks while neglecting potential future threats is one of the most frequent errors made while conducting an FTO search. The approach is fairly naive and ignores the potential future threat, even though awarded patents immediately constitute a threat to the proposed product. Published patents (both domestic applications that have received jurisdictional clearance and overseas applications) should be considered in a thorough FTO review as well. The basic rationale is that the published patent under consideration might be awarded with claims that you might later infringe.

2. Wrong FTO Relevance Criteria: FTO searches are frequently viewed as identical to other patent searches. When conducting FTO searches to determine the applicability of relevant prior art, the patent analyst applies the same selection criterion (novelty and non-obviousness). These are the proper criteria for looking for patentability or validity, however they are inappropriate for an FTO search. The shift from a patentability search to an FTO search is minor but crucial. The search should concentrate on identifying assertions that the product or a particular feature is similar to prior art.

3. Strict Concentration on Claims: It is customary to narrowly concentrate the clearance search on the claim of an existing patent. But it also exposes risks that can't be avoided. For instance, a subject matter expert who files a patent application for a grant uses more generic language in the claim and less descriptive language in the specification. As a result, a cursory glance might not indicate any potential infringement of the claim. However, the case of infringement will be established by the specification's interpretation of the claim using non-descriptive language. Reviewing the complete specification, as opposed to limiting the search to claims, will solve this issue.

4. FTO Wanted (Dead or Alive): Patent analysts adore the capability provided by contemporary search systems, which allow them to exclude patents based on their legal standing. The results of a current search can be filtered to show just patents that are still valid and enforceable (alive) or patents that have expired, been ineffective, and have lapsed (dead). On paper, this feature looks great since it eliminates unnecessary patents, which decreases noise. A deeper understanding, however, shows a totally other narrative. The expired patents that are no longer enforceable can be brought back to life by paying maintenance costs, thus they are not actually dead. The majority of countries around the world offer a grace period for revival following payment of fines and fees. Unfortunately, the search technique does not highlight any patents that might be resurrected and enforced for infringement in the future.

5. Ignoring Non-Patent Literature (NPL): This point may surprise you because NPL is not taken into account when determining if a product may violate a patent's claim. NPL, though, can show up in the future when you least expect it. NPL is a key resource for identifying potential hazards. Fortunately, you can reduce the risk by making a shortlist of businesses and organisations developing your product's relevant technology that have approval. The grace period offered to applicants during which they may publish blogs, papers, podcasts, and films is crucial for the investigation of NPL.

Our next part discusses how Sagacious IP provides a distinctive approach to FTO search as compared to its rivals in order to avoid the above-discussed issues.

Using Unusual Methods to Produce High-Quality Results

When it comes to FTO analysis, Sagacious IP takes a unique and thorough approach with several different language search possibilities. We carry out a thorough search to identify patents with claims that could make it difficult to market, produce, or use a product in a certain territory. Our search results contain useful information that can be used to influence business decisions. The following are the outcomes of our thorough FTO searches:

• Patent classification that considers the threat degree
• Chart of claims compared to product information
• precise legal standing of the cited documents
• claim limitations for connected patents
• Native language proficiency in more than 16 languages, including FR, DE, CN, JP, and KR
• legal advice requested
• FTO Format for Search Reports:
• MS PPT Document A graphic technical examination of the report's findings is based on the listed references. Additionally, a claim chart mapping of the pertinent identified references is provided.
• Excel document a spreadsheet including information on the project, such as keywords, IPC classes, search terms, project process, patents mapping according to the major aspects of the delivered product, and many other details.