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Manufacturers Thrive by Leveraging Intellectual Property

D. Peter Hochberg
By D. Peter Hochberg Partner, Walter | Haverfield, LLP

Patents encourage innovation and technical development

America has a rich history built on innovation. Our country is proud of its many firsts.  Such inventions were key to our country’s rise as a major manufacturing powerhouse.  But innovation can only thrive if it is continually rewarded.  Patents, which are exclusive rights granted to an inventor, were created as a legal means for protecting inventions.  In many manufacturing industries, inventors spend considerable time and money in R&D trying to perfect products and technologies.  They rely on patents to keep competitors from copying their inventions so they can recoup their investments.  Depending on the value of the innovation, a patent holder may also be able to license the technology to create an added income stream and further recover upfront R&D costs.

For the fiscal year 2017 (completed by the U.S. government at the end of September 2017), there were 315,386 patents issued by the U.S. Patent and Trademark Office. In industries that are particularly well known for their breakthrough designs, such as aerospace and defense, some manufacturers boast of having thousands of patents.  Not only do patents provide legal protection against competitive activity, but they also can help generate interest and investment in a company and serve to recognize inventors for their creativity.

Having represented hundreds of manufacturers over the years, I’ve seen how investments in patents pay off over the long-term, boosting a company’s bottom line as well as its reputation within the industry.  Consider the impact patents have made over the years for one Ohio-based company that manufactures parts for the U.S. Navy, as well as a long list of corporate clients.

Duramax Marine, LLC is a global leader in the manufacturing of marine components, including keel coolers (which are equivalent to a radiator). The primary objective of a keel cooler is to transfer heat from the ship’s engine to the surrounding seawater.  Keel coolers had been used for this purpose for more than 75 years.  However, about 25 years ago, Duramax Marine conducted a field study confirming that the existing designs were inefficient because they did not evenly distribute the coolant across the various tubes, thus detracting from the unit’s ability to transfer heat.  Duramax Marine developed a new design, which featured a unique entry point for the coolant.  The company patented the new design in the U.S., as well as in other countries, to provide its invention with worldwide protection.

Duramax Marine reinforced its reputation for innovation by creating an updated, more efficient design for its keel cooler about 10 years ago. Not only was the new design more efficient by creating turbulence inside the keel cooler tubes to increase heat transfer. But it also cost less and was smaller in size (which is important on marine vessels that have limited space and weight restrictions).  Again, Duramax Marine applied to patent its newest design, protecting against competitive threats and garnering publicity for its continued success in innovation.

Always striving to improve the performance of their products, Duramax Marine engineers continued to evaluate new options and have since created a new design that sandwiches two keel coolers together to further increase heat transfer. Patent applications have been filed for this newest development.

Although Duramax Marine is a relatively small company, its portfolio of valuable patents has allowed the company to carve out a prominent niche for itself in the industry. According to the company’s website, 90% of U.S. Navy surface ships and submarines use some type of Duramax Marine technology.

Of course patent protection comes with a price. And the more countries where patents are filed, the more expensive the process.  But for Duramax Marine, as is the case with most manufacturers, the investment has more than paid off by preventing competitors of all sizes from copying its technology, thus providing it with an unmatched value in the market.

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