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Wasted Maintenance Fees

Dan Buri, JD

As the economic downturn continues, individual households have been forced to forego planned expenditures. It has been no different for businesses. Many companies have found themselves in similar new budget realities. Budget cuts and layoffs have become a common theme recently in the business world. For many companies, reducing patent maintenance fees is a less obvious way of decreasing expenses.

For those companies qualifying for small entity status, the maintenance fee schedule for a patent issuing today will run about $4,000 for a single patent–$490 at 3.5 years, $1240 at 7.5 years, and $2,055 at 11.5 years. Few organizations, however, have the small entity luxury of discounted patent fees. The standard maintenance fee for a patent issuing today is more than $7,500 over the life of the patent–$980 at 3.5 years, $2,480 at 7.5 years, and $4,110 at 11.5 years. With many experts estimating that between 10 to 35 percent of any company’s patent portfolio is non-core, the maintenance fee savings can be significant. In fact, if you take into account foreign filings, maintenance fees can account for 2/3 of a patent’s overall cost.

While your company is looking at budget cuts, it may make sense to review the patents on which you are currently paying maintenance fees. You may find patents that are not core to your business—and letting them expire can save you considerable funds. Alternatively, you may find that your non-core patents hold significant value for another company. In this case, a patent sale may be a valuable option. A simple patent house cleaning could not only end up saving a significant amount of money in maintenance fees for your company, but may even bring in important unexpected revenue.