Startups and Patents: How to Make Money with Your Invention

J.D. and Matt talked with Nicole of The Law Offices of Nicole B. Erickson based in Portland, Oregon - she gave us some great insight on business formation and underlined an important tax law under the 2018 Jobs Act which allows sales of patents to be capped at 20% capital gains instead of potentially 37% taxation at the higher income levels. We also interviewed Karen Hwang, a business attorney based out of Chicago, Illinois - she gave us really good insight on what it takes to go to market and sell your product/service while keeping focused on protecting liabilities. She explained the basics of forming an LLC, and creating solid brand protection through trademarks before getting too far along. Nicole explained the different types of business structures including an S-corp and when it may/may not make sense to choose an alternative business structure. The four attorneys then critiqued the Boost Oxygen product as it was shown on Shark Tank. J.D. highlighted that the patent protection they have is not a utility patent, but instead is on the design of the mask/nozzle on the top of the canister. J.D. went on to talk about the timing of a patent and the duration of a design patent. The patent in this case will expire in 2 years - so it can take 10+ years sometimes to bring a product to market. Matt pointed out that Boost has only secured design mark protection, but seemingly has not secured any word mark protection yet. Nicole and Karen discussed the pros/cons of raising money or asking for equity or debt (loan) when starting up and what implications there may be.

Support the show

Have an invention or brand to protect? Or just curious about learning more? Download our FREE Inventor Kit here: https://keap.page/gw292/inventor-kit.html
DISCLAIMER
Everything discussed on this podcast is for informational purposes only and not for the purpose of providing legal advice.