Four Reasons Why You Should Be Thinking About Patent Translations
By Matt Sekac, Park IP
There is increased demand for translation and linguistic support for the legal sector and foreign filing services. Reports indicate that over 1 million patents have been granted globally with over 8 million still in the pipeline. Translation represents nearly 40% of the cost associated with obtaining an international patent. Matt Sekac is Senior Director, Sales Strategy & Support at Park IP Translations, a Welocalize company and global leader in legal language services. In this blog written specially for GALA, Matt shares his top four reasons why companies looking to grow globally should be thinking about patent translations:
1. Protecting your patent globally is really important.
In light of the decline of domestic manufacturing, intellectual property, including patents, has become a critical engine of growth in our world economy. In 2012 a USPTO report estimated that IP-intensive industries accounted for 34.8% of US gross domestic product, declaring that “the entire U.S. economy relies on some form of IP, because virtually every industry either produces it or uses it.” The report also noted that patent-intensive industries specifically have been a leading driver of high-paying jobs throughout the economic recovery. According to one estimate, the average price paid for a single US patent in 2012 was $374,000.
Firms hoping to compete in an increasingly global economy must take steps not only to safeguard their valuable IP in the US, but also throughout the international marketplace. Protection requires translation: most non-English speaking jurisdictions require that patent applications be submitted in the local language for examination and approval by the local patent office.
The stakes here are high and mistakes can be costly. Translation errors can lead to narrower patent protection than intended, make a patent unenforceable, or even lead to outright rejection by the patent office, potentially costing the applicant an opportunity to compete in a key international market. In one frequently cited example, a German company found itself without enforceable patent protection on a new pesticide in the $10 billion US market because the English translator incorrectly rendered as “snail” a word that can mean either “slug” or “snail” in German. Since the pesticide was mainly useful for dealing with slugs, the company was out of luck—they couldn’t stop their US competitors from simply copying the invention.
2. Patent translations are handled inefficiently and with little transparency.
Since the first international patent treaties were signed over 100 years ago, firms pursuing patent protection in foreign jurisdictions have traditionally relied on their foreign law firms in each country to administer the translation of patent applications. Before the Internet, this was really the only viable option; it wasn’t logistically feasible to cultivate and coordinate a roster of qualified patent translation professionals encompassing a range of languages and technical specialties.
Firms seeking foreign patent protection already require legal representation in each jurisdiction to advise them with respect to local patent law, prepare the required documentation, and liaise with the local patent office. These local attorneys were also uniquely well-positioned to access native speaking linguistic resources capable of translating the technical material contained in patent applications. All of these factors made local firms the natural solution for administering required translations.
While this model emerged naturally as a result of ease and necessity, it also tends to suffer from a lack of consistency and client visibility. Each firm in each country deploys its own process using translators or subcontracting companies selected according to its own qualification standards. Clients are left in the dark, with little control and limited opportunity to understand, monitor, and evaluate the quality assurance measures in place to safeguard their IP.
The Internet created an opportunity for clients to do better. It is now possible to build an extensive worldwide network of highly qualified, specialized patent translators with capabilities across a wide array of languages and technical specialties, operating within a transparent, uniform, centrally coordinated quality process.
3. International patent protection can be expensive.
Translation represents nearly 40% of the cost associated with obtaining an international patent, and for many industries, such as pharmaceuticals, it can be considerably more. The expense is driven by the value of the patent itself, as well as the technically demanding nature of the subject matter. Capable patent translators are a scarce resource, often possessing advanced degrees in technical fields and commanding high wages. In addition, an effective quality assurance process will include both a translator and separate proofreader, along with costly organizational infrastructure in place to facilitate and monitor the process. Companies still relying on their foreign law firms to handle the translations also sacrifice negotiating leverage by spreading out their spend across multiple providers instead of consolidating it.
The expense associated with international patent protection can be especially burdensome for small businesses struggling to compete in a global marketplace. The recent patent reform law directed the USPTO to study the problem, and the patent office found that small companies “face significant financial challenges in acquiring, maintaining, and enforcing patent outside the United States.”
4. Patent translations fly under the radar.
Despite their importance and expense, patent translations often escape the scrutiny of increasingly ubiquitous cost reduction initiatives at companies seeking to get leaner and leaner. This is due in large part to the traditional model of sourcing these translations through foreign law firms. Often invoices are not broken out into individual line-items, rolling up translation with preparation of the necessary documentation, review of the application content, preparation of the drawings, typesetting, and other opaque charges to arrive at a single lump sum.
Even where translation is indicated as a separate charge, the attitude of many companies has been that it’s simply the cost of doing business. Over a hundred years of having only one viable option has conditioned many buyers of this service—mainly patent attorneys and their support staff—to think of patent translation (if they think of it at all) as an inseparable component of the patent filing services their foreign law firms provide. As you get further away from the day-to-day business of filing patents, “translation” exists as one of half a dozen line items on one of a dozen invoices for one of five dozen patents included in the “international prosecution” portion of that year’s patent budget. This one component of the patent budget, in turn, is just one component of the legal budget.
However opaque and buried it is in a massive corporate budget, that single line item is a big one that adds up. Larger organizations may have the benefit of considerable resources available to safeguard their patents abroad, but the demands of a large international business driven by innovation means that considerable resources will be required just to translate the IP documentation.
Companies both large and small would do well to have a look at how their patent translation dollars are being spent, and investigate opportunities to streamline their needs in a way that improves quality, adds transparency, and reduces cost. The first recommended step: ask the experts.
Based at Park IP’s global headquarters in New York, Matt Sekac is a Senior Director, Sales Strategy & Support.