Educational Consumer Tips
Author: Better Business Bureau
BBB industry tips are general in nature and are not based on our BBB file experience with this company. USING THE SERVICES OF AN INVENTION PROMOTION FIRM - (This is General BBB Information On Issues Related To The Type of Business And Is Not Bureau File Experience With A Specific Company) You have a great idea for a new product or service, and now you need to launch it commercially as a sellable item. You could try to sell your idea or invention to a manufacturer who would market it and pay you royalties. But finding such a company could be an overwhelming task. You could also consider using the services of an invention promotion firm. Some invention promotion firms may help to get your idea or invention into the marketplace. The Federal Trade Commission reports, however, that some inventors have paid thousands of dollars to firms that promised to evaluate, develop, patent, and market inventions, but received nothing for their money. Oftentimes, it is difficult to identify the fraudulent invention promotion firms. This may be because unscrupulous and honest firms may use many similar advertising and sales techniques, market evaluations, and contract strategies. Firms may advertise through television, radio and classified ads, and their salespeople may claim to have access to manufacturers that are looking for new product ideas or that are specifically interested in licensing your product. These kinds of claims can be false or exaggerated. Therefore, ask for proof of such relationship before sending money or signing a contract. Some firms may insist on performing a market evaluation on your product which may cost several hundred dollars. Evaluations from questionable firms often make vague and general statements and provide no hard evidence that there is a market for your invention. On the other hand, reputable companies will deal with specifics. Ask what specific information you will receive, before you pay for a report on your idea. If you're interested in working with an invention promotion firm, consider taking the following precautions before you sign a contract and pay significant amounts of money. - Early in your discussions with a promotion firm, ask for the total cost of its services. Consider it a warning if the salesperson hesitates to answer. - Be careful of an invention promotion firm that offers to review or evaluate your invention but won't disclose details about criteria, system of review, and qualifications of company evaluators. - Require the firm to check on existing invention patents. Because unscrupulous firms are willing to promote virtually any idea or invention without regard to its patentability, they may unwittingly promote an idea for which someone already has a valid, unexpired patent. This means that even if the promotional efforts on your invention are successful, you may be the subject of a patent infringement lawsuit. - Investigate the company before you make any commitments. Contact your Better Business Bureau, your local consumer protection agency, and the Attorney General where you live and where the company is located to find out if there are any unresolved consumer complaints about the firm. - Make sure your contract contains all agreed upon terms, written and verbal, before you sign. Ask an attorney to review the agreement. LAW OFFERS PROTECTION FOR INVENTORS A law for inventors called the American Inventors Protection Act of 1999 went into effect January 2000. A subtitle of the law, called "Inventors Rights Act of 1999," provides new protections for inventors who are often prey to unscrupulous invention promotion companies. Such shady promoters often take advantage of an inventor's enthusiasm for a new product or service. They not only urge inventors to patent their ideas or invention, but they also make false and exaggerated claims about the market potential of the invention. When all is said and done, it turns out that nobody has an interest in developing and marketing the invention, and the inventor's money is wasted. Under the new law, invention promoters must: - Disclose in writing the number of positive and negative evaluations of inventions they have given over a five-year period, and; - Disclose their customers' success in receiving net financial profit and license agreements as a direct result of the invention promotion services. Customers who are harmed by a failure to make the disclosures or by any false or fraudulent representation by the invention promoter can sue to recover statutory damages of up to $5,000 or actual damages. The court can triple the damages if it finds the violations are intentional or willful. A complaint process has been set up through the U.S. Patent and Trademark Office (PTO). Under the rules, the PTO will forward any complaints it receives to the invention promoters who will have 30 days to respond. For more information visit the PTO's web site at http://www.uspto.gov. Information and assistance are also available from your local BBB directly or by visiting our website http://www.bbb.org as well as through the national Better Business Bureaus website consumer information page at http://www.bbb.org/library/prom.asp.