Before Investors invest in the manufacture of a product, they usually obtain an FTO opinion on the product in question. Companies with good intellectual property management (IP management) take a similar approach to product development. FTO opinions on the anticipated end product are already obtained during this process. This is not done without reason!
Sense and purpose of an FTO report
An FTO opinion allows a risk assessment to be made as to whether one’s own product infringes the IP Rights (Patents, Utility Models, Trademarks and/or Designs) of third parties. This risk assessment has a direct and significant influence on the economic value of a product. If a competitor prohibits the manufacture, offering or marketing of a developed product on the basis of its patent, asserts claims for damages or demands the recall and destruction of the products, this can mean the economic ruin of the company under certain circumstances.
Incidentally, this applies regardless of whether you have applied for IP Rights for the product yourself or have granted or registered IP Rights for the product.
What does an FTO report contain?
An FTO opinion essentially consists of two parts: The FTO search and the evaluation of these search results by a Patent Attorney.
In the FTO search, the key features of the product are first defined. These characteristics are then used to research which IP Rights or IP Right applications could be relevant for the product. The search results are then analyzed by the trained eye of the Patent Attorney. The search results are evaluated in particular with regard to the risk of infringement. Potential workarounds can often be identified at this stage. Based on the FTO opinion, it is ultimately up to the company management to decide whether the product should be manufactured or launched on the market, or whether design changes need to be made beforehand.
Conclusion
In summary, FTO opinions are part of the standard of sustainable corporate management and good IP management. FTO opinions form the basis for successful and secure product development, market launch and product utilization.
Do you have questions about FTO opinions or do you need an assessment yourself as to whether your product may infringe third-party IP Rights? Please do not hesitate