There is a common misconception about patents. Many, if not most, people believe that a patent grants to its holder the right to practice an invention. This is actually not legally correct. In actuality, a patent provides to its holder what might be called a “negative right.” More specifically, a patent provides to its holder only a right to prevent others from practicing the patented invention rather than the right to actually use the invention. In other words, when the patent holder discovers that another entity is utilizing that inventor’s patented invention (i.e., when the patent holder discovers that the other entity is “infringing” the patent), the patent holder has the legal right to stop that other entity (the “infringer”) from continuing to do so. The patent holder may also often sue the infringer for at least some of the profits the infringer has gained from using the invention in violation of the patent.
Notably, when threatened with being stopped from continuing to use the invention in this manner, an infringer will often try to make a deal with the patent holder in order to avoid expensive litigation and in order to continue using the invention. The infringer may, for example, try to buy or license the patent from patent holder. A license is, in effect, a contractual agreement that the patent holder will not sue the entity licensing the patent (the “licensee”) for patent infringement as long as the licensee continues to pay for the license and operates within any limitations in the license agreement. Obviously, such a deal may be very lucrative for the patent holder. As a result, the patent holder should always be on the lookout for possible infringers.
The fact that a patent does not provide to its holder the affirmative right for the holder to employ the invention himself may be very significant. There may be circumstances where, for example, a patent holder owns a perfectly legitimate patent but does not have the right to actually practice the invention in that patent without permission from another patent holder. This may happen where the patents of others interfere with the patent holder’s own patented invention. Let’s assume that you as an inventor make an improvement to a fuel injector that works with a particular engine design that was patented by someone else. You certainly have the right to patent your new fuel injector. However, you will not be able to effectively use that fuel injector invention without infringing on the engine patent. So, in that case, you might try to obtain a license from the holder of the engine patent so that you can exercise your own patent. In such a situation, the engine patent has becomes what is commonly called a “dominant patent” over your fuel injector patent.