What is the name of your state (only U.S. law)? NJ
I recently met with a technology person who has vast experience in an area that I need to bring my idea into a viable product. He signed an NDA so that we can discuss details. Long story short, we brainstormed and he can provide the technical expertise that I lack for a specific function of the idea. I discussed the option of funding the cost to develop the prototype, together with my expertise on another area needed. Essentially I supply the funding and the software part, and he takes the hardware development part. He initially agreed that we should look at the viability of the idea first by doing additional research and then if it turns out good, then we can discuss partnership options, whether I give him equity or contract hire him.
I got a call from him today suggesting that it is very viable and recommended we submit a patent application to protect it. He further suggested that we should take about our potential partnership, indicating that to start, he is asking to be a co-creator of the patent. From my perspective, I don't have a problem with that since essentially my idea wouldn't go past the idea stage anyway if it not for possibly his contribution. He is suggesting that we have equal rights as co-owners of the patent, and that he is willing to share equally in the cost of the patent application.
What I have some apprehensions about is on the business side of this, after say a patent is granted. Having equal rights, technically he and/or I can go our separate ways afterwards and start our own companies and develop a consumer product using the patent. We can essentially be competitors to each other. The whole point with this idea is obviously to eventually have a consumer product that can be marketable. But if I agree to equal rights on the patent and then allow him to walk away later on, don't I lose some rights for having the original idea in the first place? He is saying he feels this is best because it eliminates potential business partnership issues. Yes I agree with that, but shouldn't I have some benefit from any business ventures specially at the beginning since again I came up with the idea?
I wonder what everyone's take on this and if you have any suggestions/advice on maybe how to proceed.
Thank you so much in advance!
Henry
I recently met with a technology person who has vast experience in an area that I need to bring my idea into a viable product. He signed an NDA so that we can discuss details. Long story short, we brainstormed and he can provide the technical expertise that I lack for a specific function of the idea. I discussed the option of funding the cost to develop the prototype, together with my expertise on another area needed. Essentially I supply the funding and the software part, and he takes the hardware development part. He initially agreed that we should look at the viability of the idea first by doing additional research and then if it turns out good, then we can discuss partnership options, whether I give him equity or contract hire him.
I got a call from him today suggesting that it is very viable and recommended we submit a patent application to protect it. He further suggested that we should take about our potential partnership, indicating that to start, he is asking to be a co-creator of the patent. From my perspective, I don't have a problem with that since essentially my idea wouldn't go past the idea stage anyway if it not for possibly his contribution. He is suggesting that we have equal rights as co-owners of the patent, and that he is willing to share equally in the cost of the patent application.
What I have some apprehensions about is on the business side of this, after say a patent is granted. Having equal rights, technically he and/or I can go our separate ways afterwards and start our own companies and develop a consumer product using the patent. We can essentially be competitors to each other. The whole point with this idea is obviously to eventually have a consumer product that can be marketable. But if I agree to equal rights on the patent and then allow him to walk away later on, don't I lose some rights for having the original idea in the first place? He is saying he feels this is best because it eliminates potential business partnership issues. Yes I agree with that, but shouldn't I have some benefit from any business ventures specially at the beginning since again I came up with the idea?
I wonder what everyone's take on this and if you have any suggestions/advice on maybe how to proceed.
Thank you so much in advance!
Henry
