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July 5, 2023
John Rizvi, Esq.

Tips on Licensing Your Product Invention + A Warning About Inventor Coaches & Submission Companies

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00:00
Okay, yeah, Happy Friday, everybody. Warren, Welcome to the Ask the patent Professor Show. Today, it's actually going to be, you know, ask for and we're really honored to be able to have you here. I see a lot of participants, we've had close to 100 participants that registered. And the most of the viewership, of course, is afterwards because this is going to be recorded and put on our private Facebook group. So I have, as a moderator, I have Gabby, she'll be answering any questions that any of you have. And let me start by just saying what an honor it is to have you here. For those of you that are attending you're not familiar with with Warren. He for many years has overseen the open innovation products program for a lot of industry leading companies, including lifetime brands. And you may know more be more familiar with Farberware, Kitchenaid, and 40. Other brands Tektronix industries, their power tool group, for example, you might RYOBI. We've all seen their drills and other hardware type tools, rigid party tools and other brands. And then merchant media in the direct response television category, as far as spin through touch and other brands. So he has initiated over 100 new consumer product licensing agreements, and they've collectively generated over a billion dollars in retail sales. So Warren's a well known advocate for inventor rights. For 12 years, he's the President of the United inventors Association, and on their board of directors. He's also a member of the National Pro Bono patent commission, and the United States Patent and Trademark Office is National Council for expanding American innovation. So it's an honor to have you here. And I know,

02:01
Warren is also a regular attendee at a number of important trade shows throughout the country. So including the National hardware show, where we're going to have an opportunity to meet up there as well, this January. So with that, I want to start with

02:17
a little bit of background. For those who aren't familiar, a lot of companies that some inventors are finding out, they don't want to hear from inventors, they're not going to take their calls. They're inundated with inventor inquiries. And they have this idea that the best inventions and innovation are going to come from the inside. So some you'll you'll find some resistance. But on the other hand, there's this concept of open innovation. And companies are really embracing the the idea of getting ideas submitted from the outside, and Warren's an expert in this world. You've seen both sides of that. But tell me a little bit about what you think and inventors should know about approaching a company that has an open innovation program. Well, number one, thanks for having me. And Happy Labor Day weekend, everybody.

03:05
Yeah, you said it. Well. It amazes me, since I'm sort of professionally in this arena.

03:13
How many companies are closed minded and don't look outside their four walls for new ideas. And that became apparent to me.

03:23
We can talk about a little bit later, but I'm in a new partnership called Market blaster, we're trying to bring the open innovation platform to more companies. And I walked the recent hardware and housewares trade shows talking to company after company. And you know, the standard reaction was inventors, they drive me crazy, I don't want to deal with them. We don't know how to deal with them. It's nothing but trouble and so forth. And I found that both upsetting personally, because I feel differently, but also an opportunity to teach and train people how to do things properly. So

03:58
the companies that have established open innovation programs, they're probably fewer and farther between that have formal programs. A lot of companies have less formal programs where maybe they'll put something from marketing or sales in charge of it, or maybe it'll be the the owner of the company or president the company. It's not quite the platform or program that sort of sort of what I do, but they're all good, at least they have a desire.

04:27
Let's call it an intellectual curiosity in knowing what's going on outside the company. And that's a certain type of person that understands that and has to keep abreast of everything. You know, the the flip side of that is people are just tunnel vision and only doing their own thing. I think the companies that don't practice open innovation are in that tunnel vision, but they also are worried that

04:53
there might be battles and infringement issues and other things down the road and they want to steer wide and clear

05:00
have that. So it's an interesting prism, you know, that goes from one end to the other. But what I would say to companies and what I'm trying to offer out, and because the marketplace, we now have 100 companies sign up in our platform, and we're growing it out,

05:13
is it can be done. It requires some discipline, it requires company, philosophically coming to agreement on how to do it.

05:25
A company really following the leadership usually have the head of the company or heads of the company, that have this sort of visionary view of things and see the benefit of because it's a lot of work. There's a lot of failure associated with it, and you really have to be committed to it. So that's an opening answer. We could go on for the next three days about this. But yeah, so I mean, I get as a patent attorney, I often get asked by even other attorneys, and they say, John, you're in sometimes personal injury lawyers who help people that you know, they get injured in a car accident or, or a bus accident or any, any type of accident. They say, John, anybody can bet be into an accident and get injured. So our client base covers everybody, but you protect new inventions, like, Shouldn't your client base really be corporations? And I find that strange because it's almost if you look at some of the largest corporations today and where they started, it's not, you know, like, Amazon was one guy, Jeff Bezos said, I still have a picture of his original desk, which was a door put up on concrete blocks. And one of the most fascinating interviews was when the interviewer asked him what was one of his big, big turning points, big, joyous moments in building Amazon. And this was a recent interview, and I think I was expecting a lot of people are thinking something huge, like, oh, when we bought Whole Foods, or when we acquired whatever, and he said, You know what, the day I hired the first staff member to do deliveries for me, so I didn't have to load up my truck and run to the post office and deliver stuff myself. And that's just one example. But Mark Zuckerberg, Dell, like the list goes on.

07:10
Oh, real quick, I talked about a book. I don't know if you're familiar with it, escaping the great book I've written for inventors and launching their idea of full throttle. And Gabi if you want in the in the chat, if you want to put your crystals email address anybody that wants a copy of this, certainly if they shoot an email to my assistant, Crystal, we'll, we'll send that out.

07:33
But I think a lot of this is really familiar with you because some of your product ideas

07:40
are, you've hit it out of the park, a lot of them. What a couple I want to talk about is that that's our viewers most likely have heard of where you have teamed up with inventors to bring their product to market once the misto gourami olive oil sprayer, and it's sold over five.

07:59
Yep, sold over 5 million to date. And then the smart spin. I don't know if you have that available. But that sold 10 million units so far. Tell us about how did these inventors find you? Or did you actually walk tradeshow floors and find them? How did this come about? Well, we're probably over 20 million MS DOS now.

08:20
But

08:22
good question. But just a tip definitely back before I answer the question.

08:26
You know, I work on both the company and the inventor side. And like I'm sure you do, but you probably work a little bit more than vendors because they may be paying the bill. But it is two different cultures. And translating those two cultures is what's really critical in the space that I'm in. So yeah, as far as as far as we're how I got started. I I graduated from college a few years ago,

08:49
celebrating a birthday tomorrow. So it's gone quickly. I'm telling you, but I started Oh, yeah, February

08:59
26. So Oh, nice. Nice. Well, we certainly have our ways.

09:05
But

09:07
I went to work for a store you because you have a background in New York called Abraham and Straus. I don't know if you remember it, but we were Brooklyn Bay. So I work on Fulton Street in Brooklyn. And I became a buyer there. I worked there for six or seven years and I was a buyer. I came up to the house Where's racks. So that gave me sort of the background to get back out to Connecticut start my own stores to complete kitchen, the good food store. And I didn't know I had a cooking school, I had a number of locations and I had about 65 employees. And we were in the upscale products. I launched many new products in my store, the Nespresso coffee system, I sold the first 500 machines in America before anyone had heard of them, only because the head of Nespresso came over from Nestle's and moved to Greenwich. And I had a store in Greenwich, Connecticut. So you know, we were just in the right place at the right time, which is probably the generic answer to your question. But I launched many, many other products. So one day, an event

10:00
came into my store in the fall of 1997. And its name was Tom Roush. And he had invented the misto. And this was an olive oil sprayer. He was showing it to people, mostly men who didn't cook, who didn't understand the the product at all. And he was getting a lot of rejections for it. And he showed it to me. And I said, that's the greatest thing I've ever seen, because we had talked a lot about it in our cooking schools, the ability to spray oil, it's not easy, because oil has a heavy viscosity. So it takes a you can't just spray it like you spray water. So there wasn't really a device that could do that. And the only thing that was on the market was Pam, and pay, which is about 100 million cans a year sold in food stores, unfortunately, uses a low grade vegetable oil has preservatives in it is not good around the flame because he uses a protein get protein guest to fire it. And when you're finished with it, you throw the cannon away. And there's enough cans of Pam thrown out every year to circumnavigate the globe. So Tom came up with this, the nozzles patented. And he showed it to me. And at this point, I had never really met an inventor before I source products from around the world going to trade shows, but they're always ready and packaged to go. So I said to Tom, I'll take 100 of them right now. And we'll start selling them. And he said, Well, we haven't actually made any there is a prototype the first time I heard the word prototype, this was in the fall of 1997. So I had a lot to learn. Obviously, you can tell from my book, I've learned a lot along the way. But the whole thing fascinated me. Eventually, I helped Tom

11:34
do the marketing sales to get it out. We actually made the product and Connecticut had to set up the tooling employees to make and so forth. And in the beginning, we were making you know, 2030 a day and then we were making 506 or 700, that type of thing. And it was the classic American success story, started selling in gourmet shops. Then because of my ans background, I knew all the buyers, bases, Bloomingdale's and around the country. And it was the perfect person sort of taken out, we sold 10,000 to Bloomingdale's set up a big display, took an eight foot tall Mysto right down the elevator stairwell it it Macy's Herald Square before this before 911 set up displays there. And we sold 1.2 million misnomers the first year, made millions of dollars. And it was like I was just you know, to me, it was like the most amazing thing that ever happened. So I got a little taste of the American dream. And the end of the day was Tom's company. He was the inventor I was there to help be helpful, but I profited enormously from it. And then I we eventually he didn't want to do new products, he was ready. He didn't really have to work anymore after that. And I although he did.

12:45
So I went on other products. My next product was complete failure. It's called stir chef. I won't get into the details of that. But it was an automatic steering device that

12:56
did not work. So well. I didn't do my due diligence, took a lot of orders. Very successful, a trade show sold hundreds of 1000s in the stores. But it didn't sell on the floor. So nobody paid their bill and I went through a very painful experience. People can read about that in my book and mentor confidential. Then I came back with Marsman. So all of these were projects.

13:18
I met people, the blue, but it basically evolved into my saying, I changed my business model and I said you know what, rather than chase down inventors split money with them take money from them, I could see already in my research that inventors are getting taken advantage of by people around the country, even though not by me I actually supplied value, didn't take a dime till we made money. But I was seeing more and more this sort of platform out there where basically

13:47
a lot of what I call marketers, you can call them BS artists, whatever you want to call them. They're out charging inventors and telling them the path to gold mines and also the nonsense. And I realized that this is a tough industry and hard and I realized that if I wasn't going to take money from inventors, where was I gonna go and then ended up being companies and I ended up from my ans days knowing a lot of the principles of a company called lifetime brands was publicly traded company on NASDAQ, under l cut,

14:15
you know, 2000 employees and billion dollars in sales and so forth to fortify brands. We worked out this program to do an open innovation program. So that was my launch into that they paid me I started doing other companies so so I was able to have the bully pulpit and speaking honestly to people without having to worry about cash flow. Because when you have to worry about cash flow and doing sales in our business where there's so much failure,

14:41
then you end up telling whatever story is necessary to get people to send their money and so you get back to that personal injury. You know, weight loss property flipping nonsense that the people that people chase down. So that's sort of the the simple evolution of how and by the way along the way, I enjoyed it.

15:00
Getting involved in my nonprofit local inventor organization getting involved with the UAE which is the largest nonprofit national leader getting involved in Washington, DC politics and giving a lot of my time back. Since I've been financially successful to the community in ways to help an advocate for their rights, because inventors are under under a lot of pressure these days and a lot of ways from, from large corporations that you know, started on the right track. But now that they're up in the tree, Ford are trying to pull the ladder up. And you know, no girls allowed. Yeah, it's funny. One of you, you spoke about your book. And of course, the the main title is inventor confidential. But the byline for it is the honest guy to profitable inventing.

15:42
And I want to focus on the word honest, because that implies what some of the stuff you've been talking about is that there are a lot of scam artists out there. And phony companies selling bad advice. Where their real goal is not to is their ultimate goal is not to get the product on the market. But the inventor is the product they are the ultimate goal is to get money from them. Tell us a little bit about what an inventor should watch out for what are the red flags? That that should be a dead giveaway? Well, like the way you say that the inventor of the product, that's a good one, I might I might steal that from him.

16:23
The first red flag is when people ask you for money telling you right now. So first, the first red flag.

16:31
Here's a hard, cold truth for your audience.

16:34
There's a lot of failure in this product development and taking, you know, products to market. And now the question is, you know, how much

16:44
are you going to lose on losers? You know, we all of course, I've had Mr. On smart spin, and I've had, you know, 10 other products that have sold a million million units. I've also in all my travails of licensing things have dozens, many dozens of products that didn't make a dime, you know, so this is all part of, you know, sort of, like being in the music industry or anything, you know, you just don't show up with a band and you can't be Led Zeppelin overnight, it doesn't happen. So, you know, I try to be, you know, honest with people and, and there's an industry set up in, in the United States and of companies that allegedly help people, they go under different names, some of them are considered invention submission companies, and there's been a lot of talk about that, and they're identifiable, I will say this about the inventor, submission companies. A lot of them. I'm not, I'm not advocating for them, but I'm just saying a lot of them put their success numbers, you know, on read on their website, so when under 1% of them were a fraction of 1% have make more money back than they spend with them, you can see that and you can make a decision. That means that over 99% of people are putting money into it and not making any money back. The more subtle ones that aren't as obvious that are these coaches and vendor coaches and vendor coach, you know, companies and people who set themselves up at being gurus and, and basically they're, you know, they're out, you know, either books, associated articles and all types of stuff.

18:15
Preaching, you know, gold mines and all this, when you really pine down their numbers, they're no gold mines. They one of them has coached like 10 15,000 people and

18:25
brags about 200 licensing deals out of what 15,000 Do the math, okay. And by the way, those 200 None of them made any money. Okay, meanwhile, he's charging $3,750 For six months of coaching. So this type of stuff is, you know, really, it's the stuff that gets under my skin. It's a lot like politics, you know,

18:47
you know, it can get to you so you don't want to get too much into it. But but you know, when you when you see politician saying things that are in fact based and making up stuff, and, and just putting it out there, it's all the same genre of crap, you know, and it's really important for your audience and listeners to really parse down because they're very, very clever. It's one person I had exchanged Twitter exchange with one of them recently, he had a product that he claims as his biggest success story of all time, I know for a fact because I know the inventor that that the, the product didn't have any commercial success at market. And it it so I call them out on it. And his answer to me was, I had hoped that it was sold hundreds of millions of units. I had hoped. Yeah, you hoped but it didn't. Okay. So you have to really parse these clever, you know, these very clever, they put all their money, they put 99% of their money into marketing to you to make it sound like it's easy, because inventors are oftentimes naive, they're looking for someone to help them and before you know it, you sign up and you think it's not a big deal and so forth. The question is, where are the results? The red flag is if they charge money, ask them

20:00
Um, what are you? What are your success numbers? What percentage? How? How can I, how can paying you money, help me and what I'm doing and I write in my book, you know, we look, if you're going to bake a pie just to give it away, good, go to your thing, I'm not, I'm not going to bother you. But if you want to make money or make back more than your pie, then it costs you to make it, then you really got to look at these things very carefully. Because there's people out there that will, will, will, will, you know, I don't want to say take advantage because, you know, they're all adults. And you've got to do your homework. By the way, let me just have this because thanks for the therapy. They'll say, Well, other people charge inventors, like attorneys to do patent filings or prototypes. Yeah, but but attorneys are providing a service a specific service, that there's legal and ethical issues involved with charging, and they're not going to work on the back end. And in the case of prototypes with goods, so if you're charging for a good and service, it has value, or you can identify it, that's a lot different than the air these people are breathing. Okay, so you can see I'm a little passionate about, I don't wanna get too loud.

21:06
But read my book, and you'll see, and, and when I use the words, honest and profitable, what I'm saying is profitable. I'm saying, be very careful, because you can become unprofitable really quickly. And the question is how much you're going to lose. Because I've been down that path with the, with the star chef, and I lost a lot of money, a lot of money, I won't say, but it was close to seven figures. Okay, so I've been down that path. Now. Fortunately, I earned it, then I was able to blow it. And then I earned it back again. But but I will just say that it was the most painful experience of my life, in many ways, put my family, my home at risk, and a lot of things that inventors do. And I will say at the end of the day, that it probably gave me the platform to do a lot of things I do today, because if I hadn't been through that experience, I probably wouldn't be as passionate about, but just just keep your head on a swivel. Be aware of it profitable comes in how much risk you're willing to take. And the honest part is, is parsing through all these marketing, this marketing DS to to get to what's really right and good for you don't take shortcuts, do the hard work and do it yourself. Yeah, I guess I could say you're holding back, tell us what you really think.

22:21
But I have to say, Warren, you may need them. I didn't mean for this interview that to you might be therapy after this, because a lot of painful memories of you know, some of the failures in the past. But also,

22:35
you've seen your fair share of inventors get taken advantage of. And you're you're really kind when you see a lot of these companies are are are upfront and telling their success percentages, but they're not doing it out of the goodness of their heart. They're actually required by law, the inventors Protection Act now requires them to give their statistics so that inventors no barrier. You're right about that the amount of Protection Act of 1999. And, and they people mistakenly refer to that as like inventor submission. No, it doesn't say that. It says invention industry marketers, okay, this is the terminology he uses. But what happens is the more traditional submission companies

23:20
do tend to abide by that because they have legal teams and so forth. And it is but the law you're right. But then there's this whole genre of coaches and other marketers who claim that they're not, we're covered by that, and nobody's really battled it out yet. You know, no one's no one's really filed a class action suit. And I'm not entirely sure why. But, but, but but but there's different gradations of this is what I guess I would say. And, and I guess there's, there's, there's the legal and the law. And then there's the and then there's general ethics on it. And so I try not to as much as it drives me crazy, I try, you know, I try to put my efforts into constructive things like with the 501 C three nonprofit you because by the way, some of these companies like one of them, they set up their own organization with a similar name to the UIA. And it's a it's an extension of their business model. It's a typical bullshit things they do. And we're a 501 C three, and you know, what that involves in keeping our good name and standards and all that we have to do to be transparent and they're doing their own thing, just get more clients. You know, it's really very frustrating when you don't have massive resources. You know, you're not Jeff Bezos and you could just, you know, sign off $100 million check to fight these people. It's really a hard thing. So, try not to get overly distracted by it, but but it is an annoyance and we just try to keep preaching and events like this, you know, to just just just be aware, I have two sections of my book, one is be aware and the other was, one is beware. Beware, like the word aware and the other one is two words. Be aware. Okay, and both these things matter.

25:00
Okay, now is there

25:03
there's a lot of pathways open to an inventor to try to commercialize a an idea, what would you do like to speak about some of the options that they have? Sure, sure. So so, you know, your your inventing process starts to commence as the same way, you know, you get an idea.

25:23
You know, I think it's very, I think it's critically important to build a prototype, a functioning prototype, whether you do that yourself in the garage or the basement, and you have the ability to do it, some people do, or you have to work with others. There's a lot of great inventor, local mentor clubs around the country that has a lot of prototypes and people, but it's got to function. And that's one of the shortcuts that some of these people preach is just throw ideas against the wall, your odds of success are even far reduced by that. And then I can tell you on the other side of accepting submissions, that's the case. So building a prototype is an essential first step. And then as you build your prototype, you start to see the roadmap to what's important from patent, and particularly utility patents for me, in my arena, but obviously, this is your your arena, you know, far more than I do, but I know a fair amount about it, and, and filing provisional patents and having your utility functions go hand in hand with some sort of level of protection. Now we can debate the value of pads and how they are there to enforce them. I could be another show for another day. But I can tell you that when you submit products to the companies that I work with the lifetime brands and tectonics industries, we want to know about your patent portfolio, where what have you done, how far are you we, we don't necessarily need an issued patent. But we need to know that you've done it the right way, at least file provisionally have the willingness to convert that to a non provisional that the product functions and works. So that's all the same now, that's where the road splits after that. And, uh, to go into this, you know, pretty pretty substantially in the book, you have your choice of, do I want to go to market myself, like we did with Mysto made them here in Connecticut, set up our own sales force,

27:04
manufacture the goods ourselves, ship them in, if there's overseas, you know, landbridge across the country, fulfillment centers, selling through retailers, blah, blah, blah, collections, money, cash flow. So I have a chapter in my book called the 30 steps of going to market directly where I detail all this, and you can see what's involved. And if you want to go that route, be prepared. Now I know that there are some people that have made lots of money like Lord Dyson, you know, in England, he hit a vacuum cleaner, and now he's a lowered and he's a billionaire. But But Lord Dyson is one in a million, okay. And the odds of going to market on your own are difficult. And you got to be very careful. The other alternative, Stark alternative is to license through others. So those are bigger entities, companies, preferably larger companies that have brands shelf space, they already have outreach, consumer outreach. And if they like your product, and our progressive company can license it, the question is, what are they licensed? Well, they don't license ideas, okay? Nobody, okay, nobody cares about ideas, okay? You can slap them against the wall. But your, if you find a company that wants an idea, they're not paying too much for it. And at the end of the day, it only opens them up to if it's successful to have other people come in and steal market share for them. So companies typically want utility patents that they know larger companies can defend them more easily between that brand name, shelf space and Cloud Marketplace cloud, it becomes important it's almost like a barrier to entry in some ways that if you haven't filed a patent you're on one side of the issue. If you filed something even if it's provisional, you're you're taken far more seriously. So that in conjunction with with prototypes, by the way, using a prototype can film a video. My my byline in the book, which I tried to copyright is picture tells 1000 words a video tells 1000 pictures. And these things in conjunction will help you to present to a company you need to do your research on the company to make sure they have a reputation in the marketplace for being fair. Many of them will want to sign on disclosures or you may want to sign one, you're probably going to sign their nondisclosure that's a big insight into whether or not the company is fair minded. You can read a lot of them, have your attorney take a look at if you concern and start the dialogue and process of potentially licensing the odds again are long but if you can get licensed with the right company, and you can make a lot of money on a per unit royalty, if lots of units are sold. If you only sell a few 1000 You're not gonna make much money. But if you sell hundreds of 1000s or millions of units you can become a can be quite profitable for you. Wow. So Lauren is you're just such a wealth of knowledge and information. We're gonna we're gonna have to have you come back. We're out of time, but I want

30:00
Wanna end by if somebody wants to learn more from you or find out how to get to you or get your book, Gabby's or moderator, she can put something into the chat, but tell us what they would do. Where do we find your book? So I have, I have a website called Tuttle, innovation.com. That's t u TT le innovation.com. You can I have many other websites, but you can lead to all my other websites through that. I do have information on the book called inventor confidential, which if they it's a pretty quick read.

30:31
And they get a feel for things. I also go into the book in terms of overall challenges within the United States with innovation overall, which I'm very involved, I'm on the USAPA board, also, which we do a lot of thinking on that arena. But they can also submit products to me, particularly in housewares, and in direct response television. And then my latest effort is one called Market blast that people want to check out marketplace.com I partner in that I'm helping them run their own open innovation efforts. And we're getting, we're on the process of getting many, many companies signed up there. And basically, it's $10 per submission. We don't get involved in the back end. So we don't take any money. There's no money upfront. It's a platform that you can look at it and you can find find the right companies to submit to it makes it very, very easy for the companies to review your product. So that's what I'm working on these days. That's fascinating for those listening if you if you didn't catch all of that, or it's in the chat, but also the inventors mastermind, go to Facebook, do a search for the inventors mastermind. That's my private Facebook group. We'll have all of Warren's information there. And of course Gabby once more it's anyone that wants a copy of escaping the gray email my assistant crystal is no cost or any people will mail out a copy. Warren as always, it's a pleasure. I hope you have a wonderful Labor Day weekend. And and happy Friday to everybody else. Thank you very much. Appreciate it. Thank you

 

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