Freedom to operate (FTO) study

The freedom to operate study is the analysis by which a company verifies, before launching a product or a process, that it does not infringe patents in force held by third parties in the relevant territories. It differs from a patentability search, which asks whether the invention can itself be patented. The freedom to operate study is a tool for managing litigation risk.

How a freedom to operate study is conducted

First, the product is broken down into technical features, and the territories of manufacture and marketing are identified. Second, a search is carried out in the patent databases to identify titles and pending applications whose claims could cover those features. Each relevant title is then analysed: scope of the claims, legal status, payment of renewal fees, territories covered, possible limitations or oppositions. Finally, an opinion concludes on the risk and proposes design changes, a licence or a preventive nullity action. The public databases of the European Patent Office and of the INPI are the starting point of the search.

The limits of the study

A freedom to operate study can never guarantee the total absence of risk. Patent applications are only published eighteen months after filing, so unknown titles may surface later. The construction of the claims, notably by equivalence, involves an element of judgment. The study must therefore be updated before launch and at every significant change of the product. It is moreover covered by the professional secrecy of the attorney, which protects its conclusions in the event of litigation.

Key points

In practice, the freedom to operate study conditions investment decisions, fundraising and merger and acquisition transactions. It also prepares the defence: a company that has documented its analysis and adapted its product is better placed against a patent infringement action, and may bring an action for a declaration of non-infringement. The firm carries out these studies with patent attorneys, as presented on the page patent litigation attorney.