Beware of Invention Promotion Companies

Monday, May 22, 2006

Bob Lougher, United Inventors Association, http://www.uiausa.org

The New York State Consumer Protection Board and the United Inventors Association (UIA) are warning would-be inventors to be wary of invention promotion firms that charge thousands of dollars in advance fees, but offer little help to their clients.

"Excited inventors often get caught up in the false claims and promises made by some invention promotion firms," said Teresa A. Santiago, Chairperson and Executive Director of the New York State Consumer Protection Board (CPB). "You can lose thousands of dollars relying on these promises and even lose the rights to your invention."

The CPB today joined the UIA in urging inventors to use government and private resources to investigate invention firms before paying large advance fees. This warning comes as ABC Television is the latest to highlight the work of so-called "basement inventors." At least two competitors on the program, "American Inventor," lost thousands of dollars to invention promotion scams.

To gather information on invention promotion and patent firms, inventors can use the website of the U.S. Patent and Trade Office (www.uspto.gov/web/offices/com/iip/com plaints.htm). The agency features a list of complaints filed against specific invention promotion firms.

"More help is available from the United Inventors Association, a non-profit advocate for inventors located in Rochester, N.Y.," said Chairperson Santiago. "Since 1990, the UIA has been guiding and advocating on behalf of inventors. Its websites (www.uiausa.org and www.uiausa.com) contain an enormous amount of valuable information including links to other websites dedicated to the protection, education and encouragement of small inventors."

According to UIA Executive Director Bob Lougher, "Any company that rushes clients to patent before fully developing the invention, should be avoided at all costs." Mr. Lougher further explains, "Any invention promoter that charges upfront fees for a patent search, prior to charging thousands of dollars in upfront fees to represent the invention, obviously has a conflict of interest."

UIA President and founding director of the U.S. Patent and Trademark Office's inventor resource programs, Don Kelly, advises, "Every year, as much as $200 million flows from the wallets of American inventors into the hands of scurrilous promoters and hardly a penny flows back to the unsuspecting inventor."

"The inventors' horrific loss of money is bad enough," Kelly said, "but, worse still, is the crushing blow to their inventive spirit."

Chairperson Santiago said, "Thomas Edison said genius is one percent inspiration and ninety-nine percent perspiration. The 'genius' behind invention scams is that they make money off someone else's sweat and hard work."

Signs of an invention scam:

* Some invention promotion firms may charge thousands of dollars to market and license your invention with a manufacturer. But reputable firms do not ask for large payments up front. Instead, they profit from the royalties produced by a successfully- licensed product;
* Don't be fooled into thinking you a need a patent – or even a provisional patent – right away. This is a waste of money until your invention is in its final production stage;
* Unscrupulous invention promoters tell everyone that their ideas have market potential. The truth is that few inventions ever make it to the marketplace and even fewer achieve commercial success;
* After a firm does a preliminary review of your invention, they may tell you that they need to do a market evaluation of your invention, often for a large fee;
* An invention promotion firm may claim to have access to manufacturers who are looking for new product ideas. Always ask for proof of these contacts before you sign a contract; and,
* Fraudulent invention promotion firms may promise to register your idea with the U.S. Patent and Trademark Office’s (USPTO) Disclosure Document Program. A scam artist will charge a high fee for this service, but you can do it yourself for $10 (This does not offer patent protection; it simply provides evidence of the date of conception of the invention.)

Under the American Inventors Protection Act of 1999, invention promotion firms must disclose the following about its business practices during the last five years:

1. How many inventions it has evaluated;
2. How many of these inventions got positive or negative evaluations,
3. Its total number of customers;
4. How many of those customers received a net profit from the promoter’s services; and,
5. How many of those customers have licensed their inventions due to the promoter’s services

About United Inventors Association

The UIA, a nonprofit educational organization formed in 1990, offers services and advice covering the invention process from conception to market. Through a robust web site, http://www.uiausa.org /, UIA provides an expert advice forum, and cautions inventors about invention marketing scams. Also offered is a widely popular innovation evaluation service, a speakers' bureau and an inventors' bookstore.
Website: http://www.uiausa.org

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