IP Costs and Considerations

The one question that is common to every person or company looking to obtain intellectual property (IP) protection is what costs will be incurred.  Although the standard lawyer answer of “it depends” may be unsatisfactory, it truly does depend on many different factors, such as the type of technology, the geographical market, the size of the Applicant, the attorney’s level experience, the patent or trademark examiner assigned to the case, the prior art or existing marks, extensions of time taken to meet deadlines, etc.  Some ballpark estimates of typical IP costs are outlined below, based on recent surveys of patent firms in the US.  Given the numerous factors at play, these estimates are by no means definitive and are subject to change.

Patents

There are several considerations when estimating how much obtaining and maintaining a patent will cost, including the initial preparation of and filing the application, the back-and-forth prosecution of the application in the US Patent Office, and the issuance and maintenance fees.  A patent application by its nature is a technical document that teaches the public how to make and use the invention, and thus the complexity of the technology and number of variations disclosed also are factors in the cost.  For the initial preparation of and filing a non-provisional utility patent application, a relatively simple, straight-forward invention may cost $6,000-10,000 in attorney fees.  For more complex technologies, this cost will be higher and may be up to $20,000.  The government filing fees for the Patent Office can be found here.  The current filing fee for an undiscounted entity (companies) is $1,820.  Some Patent Office fees are reduced in half (or less) for smaller entities (solo inventors, small businesses).

After the patent application is filed, preparing and filing a response to an Office Action issued by the Patent Office typically ranges from $1500 to $3000 (per Office Action), but can be more depending on the type of reply involved, with appeal procedures generally costing more than a straight-forward reply.  In 2019, the average number of Office Actions per application was 1.7.  There are several different factors that impact the costs spent during prosecution, including the examiner, the area of art, the scope of the patent claims, the number and complexity of the cited prior art etc.  There is typically a 2 to 5 year delay between filing and a first Office Action such that the costs are spread out.

After the patent application is allowed, there is an issue fee (currently $1,200 for an undiscounted entity) and subsequent maintenance fees that are paid in three spread-out installments over about 12 years (currently $13,460 total for an undiscounted entity).  There are also associated attorney’s fees for paying fees, docketing, monitoring, etc., which may cost $1,000-2,000 after allowance.

Additional costs that may be incurred include foreign patent application filings (which are typically more expensive than filing in the US), prior art searching, patentability opinions, and preparing and filing provisional applications.

Trademarks

The cost to prepare and file a trademark application will depend on how many classes of goods or services, the nature of the classes, and whether there are existing similar marks.  Preparing and filing a trademark application may cost $250 to $350 per class in government fees, and about $500 to $700 in attorney’s fees.  Additional costs may be incurred for trademark searching.  As with patents, the prosecution of a trademark application will depend on different factors, but responding to a trademark Office Action may cost between $500 and $,2000. 

After the trademark application is allowed, assuming that the application is an intent-to-use application, there will be fees associated with filing the required statement of use, which may cost $400-600 in attorney’s fees (for one class) and $100 (currently) in government fees per class.  After registration, maintaining the registration requires filing further statements of use, which may cost $500-700 in attorney’s fees (for one class) and $200-550 in government fees per class.

Enforcement

The hardest cost to predict in IP is enforcement, because enforcement depends on how the IP holder polices their IP and how the IP holder wants to enforce their protected IP.  There may be costs associated with monitoring for infringement, notifying infringers of possible infringement, filing lawsuits, etc.

As IP costs can be steep, a party looking to obtain IP protection should consider the costs associated with their IP to determine if in addition to obtaining an IP registration, they will be able to maintain and police the IP registration, and enforce the IP if necessary.  At Renner Otto, our team is able to work with you to discuss an appropriate IP strategy and the potential costs.