Difference Between Ownership and Co-Ownership of a US Patent?

Patent Ownership: Is There a Difference Between Ownership and Co-Ownership of a Patent?

There is a surprisingly big difference between patent ownership and patent co-ownership. The addition of those two letters, co, at the front of ownership completely changes the value of the ownership right. Sole ownership is exclusive. As the sole owner of the patent, you control the right to prevent others from making, using, or selling any products or services containing the claimed technology within the nation of the patent. This means that you can block competitors from adding your patented features and functions to their products. This means that you can sell more, charge more, increase your margins, create partnerships you might otherwise not be able to create, and increase your leverage with investors. Again, though, you can do all of these things because of your exclusive right to prevent anyone and everyone from infringing your patent.

With co-ownership, both owners have the right to not be prevented from making, using, or selling the patented technology. Which means that all of the co-owners can sell competing patented products and services. Worse yet, each co-owner can license their rights to others, which means that the number of competitors can increase way beyond the co-owners. And, still worse, since none of the co-owners have exclusive rights, none of the co-owners can sell or license exclusive rights, and non-exclusive rights are substantially less valuable than exclusive rights.

Simply, without an agreement in place which provides exclusive ownership rights to one party, none of the co-owners will be able to have the benefits of sole ownership.  In some ways, co-ownership of a patent is a lot more like owning a non-exclusive license to the patent than owning the patent.  Now, while sole ownership is more valuable and typically preferred, it’s not necessary as long as you get all the commercial rights you need by agreement. For example, each party can be granted partial exclusivity by license which satisfies each of their commercial objectives, such as exclusivity in geography, domain, or even time.

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