Protection of Intellectual Property (IP)
Intellectual property (IP) covers ‘creations of the mind’ which can include inventions, designs, symbols and names and logos used in business. It is protected by law (copyright, trademarks, and various other forms), allowing people to earn recognition and/or money from what they create. Like other property, IP can be bought, sold, or licensed. There are different types of intellectual property rights including:
- Patents: these protect new inventions and cover the functionality of a product, including how the product works, what it does, how, what it is made of.
- Trade Marks: these protect brands, which could be for a business name, product or a service. Trade Marks can be made up of words, logos or a combination of the two. They can be registered or unregistered.
- Design: this protects the overall visual appearance of a product. A registered design is where the designs are examined and registered by the IPO or other body. An unregistered design right is an automatic right, but less protection is offered.
- Copyright: this is the right that creators have over their works (including music, books, films, software, databases and technical drawings). It protects the expression of, not the idea behind, the works. It is an automatic right which comes into place when the work is created and gives the creator/its owner the exclusive right to copy and distribute the work and this is usually for a limited time (it usually lasts for the lifetime of the creator plus 70 years from the end of the calendar year of their death). As it is an automatic right, there are no formal registration requirements to attend to, or fees to pay.
Why is IP protection important?
Intellectual property rights can protect more than just an idea and can protect real assets that are essential to the core elements of your business. It is vital to have your IP in order ahead of taking investment or selling your business, as any issues with the IP are likely to come to light during the due diligence process, potentially delaying the deal and deterring investors.
Additionally, when IP is used without permission, organisations can suffer financial and potentially reputational damage. Companies of all sizes are at risk of IP infringement, which was demonstrated in a recent case that Bermans was instructed on, where we acted for an SME client against a much larger competitor in relation to a claim for infringement of a registered trademark and passing off. More information about this case can be found click here. The fact that any business can fall victim to an IP dispute makes it more important than ever to be aware of and protect your IP.
How can businesses protect their IP?
Firstly, businesses need to be aware of and understand what IP is being developed, where in the business this is happening and who is creating it. Once you have an understanding of what IP exists and needs to be protected, you should assess whether the business is the owner of the IP. Some IP may be protected automatically, such as software, which is protected by copyright as soon as it is written. However, it is best practice to evidence that the business does own the IP and a good way to do this is to keep a log/design trail and to store documents relating to the IP, ensuring that these are dated.
Where a business uses a third-party (or non-employee) to develop IP on their behalf, the third party must give all documents relating to the IP to the business. Unless the parties agree otherwise, the IP will remain with the third party developing the IP, so it is important for businesses to have robust contracts in place which accurately reflect what has been agreed between you and once the development of IP is complete, additional steps should be taken, such as a formal IP assignment where necessary. If any IP has been (or should be) assigned to you, it is important to ensure that any assignment correctly identifies all of the IP being assigned. If nothing sufficient is in place, you should arrange an assignment or licence as soon as you can. Ideally, you should ensure that your contracts assign any IP to the business from the outset.
Also, when licensing your IP to a third-party, you need to ensure that you are protecting your position and your IP, by clearly identifying the correct IP that is being licensed and the terms on which it is being licensed. In consumer contracts, you should ensure you do not give any IP to customers unless this is the intention. It is important to ensure your rights are retained and that your standard terms and conditions are drafted in a way that protects your IP.
It is your responsibility to check that your IP is protected and is not being infringed upon and it is especially vital for small businesses to protect any unique services or products offered. Taking the steps to protect your IP is worth the effort, as it is a valuable part of your business and taking action early on could avoid costly disputes in the future. You should ensure that any registrable IP rights are registered correctly and that the registrations are up-to-date and accurate.
How can we help?
The commercial team at Bermans has an in-depth understanding of the needs of businesses within this sector and we are experienced at advising and assisting on all aspects of IP. We can assist you with reviewing your IP, drafting assignments and licences where needed, strengthening your terms and conditions, advising on agreements with third party developers and reviewing employment contracts and consumer contracts.
Please contact Stephen Green if you would like to discuss your IP, there is no better time to act than now!