Amazon Neutral Patent Evaluation: The Ultimate Guide to Protecting Your Products in 2024

Amazon launched the Neutral Patent Evaluation Procedure in early 2019 with the purpose of resolving disputes between patent holders and those who are accused (sometimes wrongfully) of infringement on the marketplace.

Our Amazon Seller IP lawyer addresses what you need to know about this process if you become involved in an infringement dispute. 

Amazon’s Utility Patent Neutral Evaluation Procedure Initiation

It is important to note that the process may only be initiated by a party that holds a valid utility patent.

The patent owner must submit a written request to Amazon by completing the Amazon Utility Patent Neutral Evaluation Agreement. Among other things, the patent owner must provide via the agreement:

• The patent owner’s name and address
• The names of any corporate parents, subsidiaries, or other related entities
• The U.S. utility patent number of the patent at issue
• The Amazon Standard Identification Number (ASIN) of the Accused Product(s)

STEP-by-STEP Guide to Amazon’s Utility Patent Neutral Evaluation Procedure

Amazon’s Utility Patent Neutral Evaluation is a program designed to resolve patent disputes efficiently, without the need for costly litigation. Here’s how the process works, step by step:

1. Initiation of the Procedure
   To start the process, either the patent holder or the accused seller can formally request Amazon to initiate the Neutral Patent Evaluation. This request needs to be submitted through Amazon’s platform, and it must include the necessary documentation to prove the patent’s validity and the infringement claim.
2. Appointment of the Neutral Evaluator
   Once the procedure is initiated, Amazon will appoint a neutral evaluator—a patent expert tasked with reviewing the evidence. The evaluator is independent and has no stake in the outcome, ensuring fairness throughout the process.
3. Submission of Evidence
   Both parties will be asked to submit their evidence. This may include product descriptions, patent documentation, or any other materials that prove or refute the claims of patent infringement.
4. Evaluation of the Case
   The evaluator will review the evidence, looking at whether the patent in question is valid and if the product allegedly infringes on it. The goal is to make a fair judgment quickly, without the extensive delay of a traditional court case.
5. Ruling Issued
   After reviewing the evidence, the evaluator issues a ruling, which may include a decision on whether the patent is infringed, a recommendation to cease selling the disputed product, or other measures to resolve the issue.

How to Protect Your Intellectual Property During Amazon’s Patent Evaluation

When you’re involved in Amazon’s Utility Patent Neutral Evaluation, protecting your intellectual property (IP) is crucial.

Here are a few steps you can take to ensure that your rights are safeguarded:

1. Know Your Patent Status
   Before diving into the evaluation process, it’s essential to know whether your product is patented. If you’re not sure, a quick search on the USPTO (United States Patent and Trademark Office) website or consulting with an IP attorney can clarify this.
2. Register Your Patents
   For full protection, register your patents with Amazon through their Intellectual Property Rights (IPR) system. This helps to prevent potential infringement and establishes your rights on the platform.
3. Monitor and Enforce Your Patents
   If you’re worried that a product on Amazon may infringe on your patent, keep an eye on competitor listings. Amazon’s patent evaluation can only resolve disputes once they arise, so proactive monitoring can help you stay ahead of potential issues.
4. Consult an IP Lawyer
   Before entering any disputes or filing a neutral evaluation request, it’s always wise to consult with an Amazon seller IP lawyer. They can help assess the situation and provide strategies for protecting your products and ideas.

What Happens After the Neutral Evaluator Makes a Ruling?

Once the neutral evaluator issues their decision, the next steps depend on the ruling itself. Here’s a breakdown of what could happen:

1. Infringement Ruling
   If the evaluator concludes that your product infringes on a valid patent, Amazon may take action, such as removing the infringing product from the marketplace or issuing a warning to the seller. In some cases, the seller may be required to cease sales or even destroy the infringing products.
2. Non-Infringement Ruling
   On the other hand, if the evaluator determines that there is no infringement, the seller can continue selling their product on Amazon. The patent holder may choose to appeal the ruling, but unless new evidence is presented, this decision typically stands.
3. Appeals and Further Action
   Both parties have the option to appeal the decision through Amazon’s established procedures. Keep in mind that any further action will likely involve additional legal costs, so it’s best to resolve disputes at this stage if possible.

Common Defenses in Amazon’s Utility Patent Neutral Evaluation Procedure

If you’re involved in Amazon’s Utility Patent Neutral Evaluation, understanding common defenses can help you prepare for the process. Here are some key strategies often used by sellers:

Non-Infringement

Arguing that your product does not infringe the patent is the most straightforward defense.

This might involve demonstrating that your product does not fall under the patent’s claims or that the patent is too broad.

Patent Invalidity

Another strong defense is challenging the validity of the patent itself.

If you can show that the patent was incorrectly issued or that it lacks novelty, this may invalidate the patent claim.

Prior Art

If similar patents or products existed before the patent in question was filed, presenting prior art can weaken the patent’s claim to uniqueness.

This defense is common in patent disputes and can significantly shift the outcome of the evaluation.

Licensing or Fair Use

In some cases, sellers may prove that they have a license to use the patented technology or that their use qualifies as fair use under patent law. This can avoid a ruling of infringement.

Seller’s Response to Initiation of Amazon’s Utility Patent Neutral Evaluation Procedure

If an accused seller, or their Amazon Seller IP lawyer, fails to respond within three weeks, then the patent owner “wins” the proceeding.

In other words, the allegedly-infringing listing is removed as a result. To respond to and refute an accusation of infringement in a timely matter, the accused seller must also complete and submit the Amazon Utility Patent Neutral Evaluation Agreement.

How to Prepare for Amazon’s Utility Patent Neutral Evaluation Procedure

Preparation is key to navigating Amazon’s Utility Patent Neutral Evaluation smoothly.

Here’s what you can do to ensure you’re ready:

Gather All Relevant Documentation
Collect any documents that support your case. This includes product designs, patent documentation, sales records, and any other evidence that shows either infringement or non-infringement.

Review the Patent Claims
Familiarize yourself with the specific claims of the patent in question. This is crucial for understanding what the patent covers and whether your product falls within those claims.

Consult with an IP Attorney
Even if you’re not an expert in patents, consulting with an IP attorney who understands Amazon’s processes can make all the difference. They can help you interpret legal jargon and strategize your defense.

What Are the Costs of Participating in Amazon’s Utility Patent Neutral Evaluation?

While the Amazon Utility Patent Neutral Evaluation program is designed to be more affordable than traditional litigation, there are still costs involved. Here’s what you might expect:

Filing Fees

Both parties may be required to pay a filing fee when initiating the procedure. These fees are typically lower than those associated with full patent litigation, but they can still add up.

Legal Fees

If you hire an attorney to help with the evaluation process, there will be legal fees. These vary depending on the complexity of the case and the attorney’s rates.

Potential Outcome Costs

If the evaluation results in the removal of a product or damages, there may be additional costs, including fees for relisting a product or handling inventory returns.

Is Amazon’s Utility Patent Neutral Evaluation Procedure Right for Your Case?

Deciding whether Amazon’s Utility Patent Neutral Evaluation is the right route for you depends on a few factors:

1. The Strength of the Patent
   If the patent is likely strong and valid, this process could be a quick and cost-effective way to resolve the dispute. However, if the patent is weak or its claims are unclear, challenging it through this process may be difficult.
2. The Cost of Litigation
   If you want to avoid the high costs and lengthy timelines of traditional patent litigation, Amazon’s neutral evaluation might be a suitable option. It provides a faster and more budget-friendly resolution.
3. The Nature of the Dispute
   If the dispute is based on a clear case of infringement and you’re confident in your defense, the neutral evaluation could help resolve the issue quickly without a court battle.

In summary, whether the Neutral Patent Evaluation is the best option comes down to your specific situation, the strength of the patent, and how much time and money you’re willing to invest in the process.

Appointment of Neutral Evaluator

Once a patent owner and accused seller (or sellers) submit their paperwork, Amazon will select a qualified patent attorney to serve as the neutral evaluator for the process.

Each party must submit a $4,000 deposit to be held in escrow by the evaluator, pending the outcome of the proceeding.

If the accused seller does not pay the fee, then the product listing(s) at issue will be removed. 

Length of the Amazon Utility Patent Neutral Evaluation Procedure

After both parties pay the fees, the evaluator then establishes a 2 to 3-month schedule for the process, in which strict deadlines are set. Requests to modify the schedule are not permitted, and failure to meet a deadline can result in forfeiture of the case and the party’s $4,000 deposit.

Evidence Considered By The Neutral Evaluator

The evaluator will not consider any oral testimony from any party or their Amazon Seller IP lawyer.

They will, however, consider photographs and charts in addition to the written arguments and responses.

Discovery, depositions, and physical evidence are not allowed to be submitted for consideration. 

Defenses Allowed

The seller may only use the following defenses:

• Non-infringement
• A previous ruling by the court that the patent is invalid
• The goods in question were on sale for more than a year proper to the patent effective date

Possible Outcomes

After considering the arguments and evidence, the evaluator will issue his or her ruling.

The evaluator will make one of the following findings:

• The product likely infringes the asserted patent; or 
• The asserted patent likely does not cover the product or is likely invalid

The prevailing party is then refunded its $4,000 fee. The evaluator retains a maximum of $4,000 as compensation.

Any excess amount paid by sellers may be awarded to an Amazon Smile charity of the patent owner’s choosing if the patent owner prevails.

Amazon will generally remove a listing within 10 business days after a decision is handed down against a seller.

Amazon may restore a listing if a subsequent judgment or order from a litigation or arbitration proceeding is submitted.

A Note About Amazon’s New Patent Evaluation Express Program (APEX)

The Amazon Patent Evaluation Express Program (APEX) is the company’s newest, fastest and least expensive way for utility patent owners in the United States to resolve disputes on Amazon’s US platform.

Similar to the company’s previous UPNEP program, APEX uses a third-party attorney to analyze and determine whether patent infringement has occurred.

The upside to using the program is that those who participate typically receive decisions within two months, as opposed to waiting on an outcome from patent litigation, which can take several years to resolve.

Consult With An Amazon Seller IP Lawyer at ESQgo

If you are a patent holder or you have been accused of utility patent infringement, an Amazon Seller IP lawyer at our firm is here to provide the guidance you need regarding Amazon’s Utility Neutral Evaluation Procedure.

Schedule a consultation with our firm so we can discuss the options available to you.

Conclusion

Navigating Amazon’s Utility Patent Neutral Evaluation procedure can seem daunting, but it offers a streamlined, cost-effective way to resolve patent disputes without the complexities of traditional litigation.

By understanding the process, preparing thoroughly, and utilizing defenses like non-infringement or patent invalidity, you can protect your intellectual property and resolve conflicts efficiently.

If you believe your product may be at risk of patent infringement or if you’re facing a challenge to your product’s patent status, the Neutral Patent Evaluation could be the right solution.

It’s essential to weigh the potential costs, gather the necessary evidence, and seek expert legal advice to ensure the best outcome. Whether you’re a seller looking to protect your innovation or a company facing a patent challenge, Amazon’s evaluation procedure offers a fair, expedited way to safeguard your business and ideas.

In the end, knowledge is power.

Understanding how this process works and how to prepare for it can save you time, money, and frustration.

If you’re unsure about your next steps, consulting an Amazon seller IP lawyer is always a smart move to navigate this complex landscape with confidence.

Frequently Asked Questions (FAQs):

What is the Amazon Neutral Patent Evaluation?

Amazon Neutral Patent Evaluation is a program designed to resolve patent disputes between sellers and patent holders quickly and efficiently. It allows both parties to present evidence to a neutral evaluator, who then makes a ruling on whether a patent has been infringed.

How do I know if my Amazon product is patented?

To check if your product is patented, you can search the United States Patent and Trademark Office (USPTO) database or consult with an intellectual property (IP) lawyer. Additionally, if you’re concerned about patent infringement, you can use Amazon’s patent evaluation process to help resolve disputes.

Does Amazon enforce patents?

Yes, Amazon enforces patents by taking action against products that infringe on valid patents. This can include removing listings, blocking sales, or even suspending accounts. Amazon’s Neutral Patent Evaluation program helps resolve these disputes without the need for costly legal action.

What is a utility patent in Amazon?

A utility patent is granted to an invention that is novel, useful, and non-obvious. In the context of Amazon, it refers to patents covering the functional aspects of products sold on the platform, such as unique designs or technological innovations.

How long does the Amazon Neutral Patent Evaluation take?

The evaluation process typically takes 30-45 days, depending on the complexity of the case and the evidence provided by both parties.

What happens if the evaluator rules in my favor?

If the evaluator rules in your favor, the patent claim will be dismissed, and you can continue selling your product on Amazon. The patent holder may choose to appeal the decision, but unless new evidence arises, the ruling typically stands.