A patent may be filed at the United States Patent and Trademark Office under small entity status. Small entities only pay 50% percent of most Patent Office fees, including application filing fees, application size fee, excess claims fees, extension of time fees, revival fees, appeal fees, patent issue fees, statutory disclaimer fees and maintenance fees.
The following entities qualify for small entity status:
- a small business concern as defined under section 3 of the Small Business Act (i.e. the number of employees, including affiliates, does not exceed 500 persons)
- an independent inventor
- a university or other institution of higher education located in any country
- a non-profit organization as described in § 501(c)(3) of the Internal Revenue Code and exempt from taxation under § 501(a)
- any nonprofit scientific or educational organization qualified under a nonprofit organization statute of a state of this country
- any nonprofit organization located in a foreign country which would qualify as a nonprofit organization if it were located in this country
Additionally, to qualify for small entity status, no large entity can have rights in the invention. Specifically, a small entity may not have “assigned, granted, conveyed, or licensed, and is under no obligation under contract or law to assign, grant, convey, or license, any rights in the invention to any person, concern, or organization which would not qualify for small entity status as a person, small business concern, or nonprofit organization.”
Because of the provisions regarding licensing to large entities, it is possible to qualify as a small entity for one invention but not another. Failing to properly determine and/or notify the Patent Office of a change in status can result in the invalidity of your patent, leading to the loss of any patent rights. Make sure you notify your patent lawyer of any relevant changes in your business and/or licensing agreements that may affect your entity status. If you have any questions, feel free to contact a qualified patent attorney at Cotman IP in the Los Angeles area.