Once the patents at the top of the list of have been selected for pruning, they should be reviewed for their business use by subject matter experts. Such a review corresponds to the columns shown in the first figure above. The reason this step is put off until this point in the process is that now the number of patents to be considered for pruning should be quite small.

The best group of individuals to get together for this final audit are those familiar with the technology, manufacturing, distribution, and sales of the product and service. Personnel often consist of a research fellow or “gatekeeper” from R&D, an engineer from manufacturing, and a representative from business development or marketing. Looking at the patents one by one, it has been found that a group of senior people can determine a patent’s business use in a matter of seconds. It is not uncommon for teams to agree on business uses at rates of 100 patents per hour. Since the patents are likely of low value it is relatively easy to confirm that the patent cannot be used (1) for barter or trade in a freedom to operate negotiation, (2) to exclude current competitors from an advantaged business position, or (3) for out licensing, cross-licensing or industry/government standards activities.

Example Patent/Product/Revenue Table

In mature markets, the degree of commercial advantage that a patent provides is sometimes slight. Even a group of senior managers can be uncertain of their decision. In such cases, it is important that the business development or marketing executive present knows the sales revenues and profits for each of the business lines that the patents have been assigned to. If that business line has significant revenues and/or profits, then you can be assured that competitors will be trying to fast-follow the company’s position. In this case, it is better to err on the side of keeping a patent rather than abandoning it. Such Patent/Product/Revenue data is often available in the company’s financial and business databases as shown in the “Patent/Product/Revenue” figure.

When the audit is completed, fees are no longer paid on the patents selected. For patents that might be helpful in out-licensing, cross-licensing, or other business uses, those assets are passed along to the appropriate licensing or regulatory groups. For art that is supporting profitable high-growth products, it is also key to ensure that R&D and business development groups build out appropriate patent fences and patent families.