Invention Submission

The smartest way to make sure you're using a legitimate company to promote your idea is to do research. Find out if the company was ever investigated or in trouble with the FTC, Better Business Bureau or any other consumer protection agency. This may be a good sign as to whether or not the company is reputable.

For information on how to spot a legitimate inventor promotion firm, visit the FTC's Web site at www.ftc.gov. For information on patents, visit the U.S. Patent Office Web site at www.uspto.gov.

We're all vulnerable to flattery, inventors are no different. Who doesn't want to hear that they've invented the next big thing and are about to become rich beyond belief? The important thing to remember when soliciting inventor promotion companies is, if it sounds too good to be true, it probably is.

Many fraudulent invention promotion firms offer inventors a research report or market evaluation of their idea that can cost hundreds of dollars. Once the research is completed, they offer patenting or marketing and licensing services, which can cost several thousand dollars. If you are thinking about contacting a promotion firm, the first question you should ask is for the total cost of its services. Legitimate companies will have relatively small, if any, upfront fees because they make their money from successful royalty arrangements from the inventions they accept. If they do have upfront fees, reputable companies will tell you all of the out-of-pocket costs right away, before a relationship is solidified.

The American Inventors Protection Act of 1999 gives you certain rights when dealing with invention promoters. Before an invention promoter can enter into a contract with you, it must disclose the following information about its business practices during the past five years:

  • how many of those inventions got positive or negative evaluations (legitimate companies will have a fairly low acceptance rate, usually under 5%);
  • how many of those customers have licensed their inventions due to the promoter's services (if the success rate is too low, between 2 and 5%, the company's services may not be worth your out-of-pocket expenses).
  • how many inventions it has evaluated;
  • how many of those customers received a net financial profit from the promoter's services (that is, the number of clients who made more money from their invention than they paid to the company); and
  • its total number of customers;
Many inventors have turned to invention submission and idea promotion companies which promise service - they say they'll evaluate your invention, research the patent and contact manufacturers on your behalf. Unfortunately, many companies that claim to help inventors develop and market their ideas have been under investigation for fraud by the Federal Trade Commission (FTC) and other government agencies. In fact, the U.S. Patent Office estimates that inventors stand to lose close to $300 million each year. How do you protect your invention and your wallet from fraudulent invention promotion companies?

Invention promotion companies usually advertise on television, many times in the late night or early morning hours. Before calling that 1-800 number flashing on your television screen, consider the following real-life examples. Hopefully they'll persuade you to do some research before opening your wallet to an invention promotion company:

  • In 2001, Virginia Jones, an elderly widow from North Carolina, took out loans to pay for $20,000 worth of invention promotion services. She and her former husband invented a device that controls smoke emissions from wood stoves. Jones spent more than $10,000 with one firm, and had only a patent to show for it. That company eventually refunded her money, but only after she agreed to a "gag" order not to discuss the case. Then a second firm, Invention Publishing and Research, noticed the patent on file at the U.S. Patent Office and contacted Jones, saying it had a better way to promote the product. She fell for the second company, and, after parting with more money, got a six-month period of work. After that, she never heard from the company again.
  • Texas resident Shannon Mahaffey dialed the toll-free number for Invention Submissions Corporation (ISC), the nation's largest patent broker and promotion company. He invented a system that would provide storm warnings to rural areas without sirens through the phone lines. After years of borrowing money to pay ISC a total of $13,000, his idea still isn't on the market.