A Freedom to Operate (FTO) search, also known as a clearance search or right-to-use search, is an analysis conducted to determine whether a product, process, or technology can be commercialized without infringing on existing third-party intellectual property (IP) rights, especially patents.
It is essential when introducing a product into a new market. Businesses can strategically plan their market entry, possibly negotiate licensing, or alter their product to avoid infringement by analyzing the competitive intellectual property environment. Failure to conduct an FTO exposes to a risk of infringement.
There are numerous instances where even major companies have been required to pay substantial amounts in patent infringement lawsuits.
Benefits of conducting FTO search
A Freedom to Operate (FTO) search can help avoid the risk of costly and time-consuming litigation that could result from an infringement lawsuit. A favorable FTO opinion, indicating clearance, boosts investor confidence in the safe launch of products. By leveraging the relevant findings from an FTO search report, companies can identify potential parties for purchasing, licensing, cross-licensing, or participating in patent pools. Additionally, an FTO search helps pinpoint specific components of a target product that need to be modified to avoid infringement. Such an opinion can also serve as a precaution before acquiring a business or a particular product segment. An FTO search without date restrictions will assess patents that are expired or nearing expiration, providing access to useful technologies from these older patents.
Significance of a Freedom to operate (FTO) search
A Freedom to Operate search, also known as a clearance search, involves a comprehensive review of existing patents to determine whether a product or process infringes on any active patents. This search helps identify potential legal risks associated with launching a product in any new territory, allowing companies to make informed decisions and avoid costly litigation.
The primary value of an FTO search lies in risk mitigation. By identifying potential patent conflicts early in the development process, companies can adjust their designs, seek licenses, or develop alternative strategies to design around existing patents. This proactive strategy safeguards the company’s financial stability and reputation while also saving time and resources.
FTO searches are country-specific
A patent is territorial, meaning it is only enforceable within the jurisdiction where it is granted. The patent law of a every jurisdiction outlines the general subject matter that can be patented and the conditions for obtaining a patent. Typically, a patent comprises two main sections: the written description (often including a drawing) that discloses the invention to the public, and the claims that define the specific intellectual property rights granted to the inventor.
Active or granted patents differ according to the statutes of each country. These statutes specify the parameters of patent protection, including its duration and scope, as well as the prerequisites for applying for and keeping a patent. For instance, a patent’s term might vary; it usually lasts 20 years from the date of filing, but it can also be shortened or extended based on national laws and unique territorial provisions, such as drug extensions or delays in regulatory approval. Furthermore, variations may exist even in the types of claiming, or the patent eligible subject matter as well as the extent of disclosure mandated in the patent application.
Statutory provisions, their interpretations, and applications as well as procedural aspects, examination guidelines may differ greatly throughout the world.
Hence FTO searches are conducted per territory as patents are jurisdiction-specific, and the rights they confer are limited to the territories where they are granted. Conducting FTO searches separately for each desired jurisdiction is essential to ensure comprehensive risk assessment and avoid potential legal conflicts.
An exhaustive FTO search that considers all possible patent claims relevant to the product to identify and address even indirect or less obvious infringements is effective in determining the freedom to operate in that territory. Moreover, rules for even claims interpretations for determining infringement and FTO vary across different territories and are required to be considered in the assessment of FTO.
Understanding these complexities supports in crafting a more efficient and targeted FTO search strategy.
Factors to be considered while conducting FTO search
At various pivotal points during the development of a product or process, performing an FTO search in order to mitigate possible legal hurdles may aid to have a seamless commercial launch. The following are some relevant considerations in carrying out an FTO search:
- FTO searches are conducted considering territorial restrictions and legal provisions
- FTO searches are conducted by keeping a Date restriction for the search:
Typically, a 20-year period is considered for conducting FTO searches. Patents too have a fixed term of typically 20 years. In some cases, or jurisdictions, this period can be extended by a few additional years through regulatory mechanisms such as Supplementary Protection Certificates (SPC) or Patent Term Extensions (PTE). Searches must taking in to account territory specific rules that govern the patent term..
- FTO searches are conducted based on Legal status:
Legal status refers to the standing of a patent or patent application according to the applicable laws of the relevant Intellectual Property Office. Although an FTO search is conducted to find ‘active’ patents, that may potentially be a hurdle to the product or process. The legal status is categorised as ACTIVE or INACTIVE which are further segregated into filed, granted, refused, withdrawn, re-examined, reissued, or expired.
INACTIVE patents and applications can serve as potential clearing documents as well as can be used for defensive purpose. However, in the FTO search, priority is always given to active patents and applications to inform of cases of possible infringement.
- FTO searches are necessitate careful analysis of patent claims:
The claims section of a patent document defines the scope of its protection. Therefore, attention is directed to the mapping of the claim elements with features of the product or process. Broad claims that encompass the product or process even if the invention is not explicitly stated. Even while many patents and patent applications appear unrelated to the product or method at first glance, it’s possible that their claims are sufficiently broad to cover the subject product or process.
- FTO searches include international applications or PCT applications within specified dates:
An international application, or PCT application, may enter the regional or national phase within 31 months from the earliest priority date. Therefore, a date restriction of 31 months should be applied during the search.
- FTO searches may be easily carried out using patent databases:
Patent databases help in collating patent and application data across geographies. To optimize timely searches and ensure that all relevant results are captured, it is useful to employ a patent database with extensive coverage across all jurisdictions. Both paid and free patent databases can fulfil this requirement.
Steps for conducting an FTO search:
- Dedicate significant time early in the product or process development to understand the technology thoroughly.
- Identify and list down the key features of the product or process whose search is to be conducted.
- For the search, identify appropriate technical and non-technical keywords and their synonyms; identify appropriate classification codes
- Devise multiple search strategies using combinations of keywords and classification codes; create comprehensive search strings and test their robustness by running searches and doing a quick analysis to catch redundancies or inconsistencies
- Conduct multiple searches family-wise using the search strings across various databases to capture all relevant families
- Screen the results from the search based on well-defined criteria to identify the most relevant documents
- Analyze and categorize documents based on relevancy and verify their legal status
- Provide a comprehensive and intuitive report with a detailed technical analysis
At SJP, we have a team of techno-legal experts who can understand the deeper technicalities of the product or process that you are seeking an FTO for. Our expertise lies in conducting thorough searches, proper mapping of the product features with the claims elements in identified patents thus offering clarity and building confidence in our clients. Our team of professionals performs an end-to-end hand holding and helps uncover potential patent conflicts and opportunities, helping companies and inventors to make informed decisions, strategize their IP, minimize risks, and advance their innovations.
