Hands down the smartest and most important decision an inventor will ever make is filing for a patent. Patents are basically ownership of an idea, tool, product, or process and once ownership is obtained, anyone hoping to use the patent must pay the owner what's known as a licensing fee; also known as royalties. It's very similar to owning property and renting it out, except there is no limit to how many people can license the patent. Securing a patent can prove to be an astoundingly lucrative business move, potentially earning the patent holder millions in profit. Here are 9 patents that have earned millions for the inventor.
9 P.Diddy vs Sting - $2000 a day
In 1997, P.Diddy sampled the classic police song, "Every Breath You Take," for a tribute track to his late best friend, Notorious B.I.G. called, "I'll Be Missing You". Unfortunately for Diddy, he hadn't received legal permission to do so, which would have resulted in only having to give up 25% of the publishing royalties to Sting. Fortunately for Sting, who owns 100% of the original, Diddy's carelessness to properly retain permission for the sample resulted in Sting reaping 100% of the publishing royalties for the P.Diddy version. To this day, Sting is reported to have earned between $20-$40 million for "Every Breath You Take," and at least $2000 a day from P.Diddy's Grammy award winning, best selling single of all time, "I'll Be Missing You."
8 Valve Technology - Paul Brown $13 million
Paul Brown is the man responsible for the valve that allows liquid products to be stored upside down without leaking. After months of toiling away at failed prototypes, shelling out thousands of dollars, maxing out credit cards and loaning from friends and family, Paul finally perfected his invention after exactly 112 attempts. He patented the functioning valve in 1991 and licensed it to companies like Gerber, NASA, Heinz and many others in the food and cosmetic industries. In particular, Paul's valve invention is the reason many ketchup lover's no longer have to fuss with a glass bottle. By 1995, Paul managed to sell his company, which owned the rights to the valve for $13 million, although the inventor could have made out a lot better had he cut a deal to receive a small portion of every product sold in perpetuity.
7 Lonnie Johnson vs Hasbro - Super Soaker $73 million
6 ViaSat vs SSL Broadband Satellite - $100 Million
Satellite builder Space Systems/Loral (SSL) was found guilty of infringing on the patents of ViaSat Inc., as well as breaching a contract held with their former customer, by building broadband satellites for ViaSat competitors. ViaSat was initially awarded $283 million by a San Diego federal jury, but later decreased by U.S. District Judge Marilyn Huff, to $100 million. Space Systems Loral were ordered to pay $40 million up front, and the remaining $60 million in quarterly installments, over a 2.5 year period. ViaSat President, Rick Baldridge is quoted as saying, “What we wanted to do was establish the fact that this was our technology, that somebody took it that shouldn't have taken it, and I think we accomplished that. We believe this settlement is the largest ever in a commercial satellite communications intellectual property matter.”
5 Zimmer vs Stryker Pulsavac Plus - $228 million
In 2013, medical technologies maker, Zimmer was ordered to pay Stryker $228 million in copyright violation penalties, over the medical system Pulsavac Plus; a device used to remove debris during orthopedic procedures. A Michigan jury ruled that Zimmer infringed three patents owned by Stryker. Originally ordered to pay just $70 million in estimated stolen revenue, the amount was later tripled by U.S. District Judge Robert Jonker, to $228 million as the court found there to be "willful infringement" on Zimmer's part.
4 Apple vs Samsung - $290 million
Technology manufacturing giants, Apple and Samsung went head-to-head in a 2 year copyright infringement battle, in which Apple sought $2 billion in copyright violation fees. In 2013, the verdict was in favor of Apple who received $290 million. Some of the patented features that Apple claims were illegally used in Samsung products include: slide to lock, zoom text with a finger tap, and tap from search: which allows users to initiate a call from just a partial search result. It may come as a surprise that features so simple and seemingly common can be patented, but as a result of having the patent in place, Apple was able to gain $290 million from Samsung's sales, in addition to the multi billions in sales they produce annually.
3 Spanx Sara Blakely - $1 billion
Known as the youngest female self made billionare, Sara Blakely came up with the idea for Spanx, after cutting the legs out of her stockings one day. Despite facing much discouragement from male manufacturers who didn't see a need for Sara's idea, the young entrepreneur used her entire life savings of $5000 towards researching and manufacturing the prototype. Because Sara was unable to afford a patent attorney at the time, she was left with no choice but to take it upon herself to study the necessary text books and write her own patent. Sales of her product expanded once the queen of media, Oprah Winfrey included Spanx on her list of favorite things one year, after receiving a heart felt letter from Sara detailing her story. Today, Sara is worth over $1 billion as a result of her determination, perseverance and most importantly, the good sense to secure a patent.
2 Nokia vs Apple - $1 billion +
Nokia was awarded more than $1 billion from Apple after winning a copyright infringement lawsuit that lasted 2 years. In addition to a one time settlement of about $1 billion, Nokia also receives further royalties of $13 per iPhone device sold in perpetuity. Apple has sold over 100 million iPhones since their launch. Fortunately for Nokia, they'd filed a patent back in 1999, covering the use of touchscreen technology in phones. Apple is far more popular than Nokia as far as cellular devices go, but a sale for Apple is a sale for Nokia, thanks to the person who made the wise decision to file a patent when they did.
1 Beanie Babies Ty Warner - $1.76 billion
Ty Warner's Beanie Babies creation helped him to build an empire that became bigger than toy manufacturing giants, Hasbro and Mattel combined. While on vacation in Italy, Warner had an epiphany that inspired the invention of Beanie Babies. Ty used brilliant marketing tactics like limited editions, and secret releases to build anticipation and create excitement around the toy. At the height of Beanie Babies' popularity in 1995, Warner's invention was turning in profits of over $700 million. Since expanding his empire to include Four Seasons hotels in NYC, as well as a few resorts, the former failed actor is worth $1.76 billion.