Intellectual property represents valuable assets to your business, helping to give you a competitive edge and distinguish your business from your competition.
Intellectual property is valuable
Intellectual property, when done right and used in a comprehensive and thoughtful manner, makes your business much more competitive, valuable and interesting to customers:
- Distinguish your business from the competition
- Make it more difficult for competitors to compete unfairly or trade off your goodwill
- Make it easier for your customers to find, identify and distinguish your business from others
- Add significant value to your business for potential acquirers
- Looking for funding? Investors view intellectual property as critical to the success of their investments
There are five (5) types of intellectual property
Patents, trademarks, copyrights, trade dress and trade secrets are the typical forms of intellectual property. Each type of intellectual property has its purposes, and each can help provide tremendous value, depending on your business.
- Trademarks – A trademark is a distinctive sign or indicator used to uniquely identify a source of goods or services in the marketplace. Trademarks are absolutely critical in protecting your business, and making it easy for customers to identify your business against the competition and other businesses that would otherwise take advantage of your goodwill. Please read the blog article about trademarks.
- Trade Dress – Trade dress is a form of trademark, in that it refers to the visual appearance of a product or its packaging (or even the design of a building), and is design to protect customer confusion in the marketplace. If you have distinctive packaging, seating, bagging, or other distinctive features you use as a form of identification for your business to your customers, trade dress protection is a means to protect your goodwill against all imitators.
- Trade Secret – Trade secret represents confidential or classified information, not generally known or reasonably ascertainable in the marketplace, and the knowledge of such provides a competitive or economic advantage. To obtain trade secret protection, you must take reasonable precautions to prevent disclosure. Trade secret protection enables you to prevent certain important information (i.e. customer lists, formulas, processes, etc) from being placed in the wrong hands, and if it does end up in the wrong hands, such protection gives you options against the parties violating your trade secrets.
- Copyrights – Copyrights protect unique works or expressions, and prevent others from utilizing your work without your permission. Taking the right copyright precautions and actions, can help protect your business investments. For example, if you’re a restaurant, you can copyright your menu. If you are a construction company, you can copyright your signs or unique work-product.
- Patents – A patent gives the holder a monopoly on a specific discovery for up to 20 years. Patents are useful to protect “any new and useful process, machine, article of manufacture, or composition of matter, or any new and useful improvement thereof.” They are great tools to provide a competitive edge, and they become valuable in of themselves. Patents represent the only form of intellectual property that L4SB does not do, although will be happy to refer you to competent counsel.
For trademarks, trade dress, and trade secret: enforce your rights, or lose your rights
That’s right. You must not take a laissez-faire approach to your trademarks, trade dress or trade secrets (“laissez-faire” is French and literally means “let do”, but it broadly implies “let it be”, or “leave it alone.”). Why is this?
The answer for trademarks and trade dress makes sense, if you understand the general purpose of trademark law: to protect against consumer confusion as it relates to the source of goods and services. The ability to protect a trademark is directly related to its strength, and a trademark that has been used by others (i.e. not enforced by the original trademark user) clouds consumer awareness of who is really the source of a particular good or service (in trademark law, this is called “likelihood of confusion”). The longer this continues, the greater the likelihood of confusion (in the mind of the consumer). Unfortunately, your trademark (or trade dress) could become almost unenforceable overnight, depending on how lax you are, the circumstances, the type of trademark, how zealous the infringer, and the overall likelihood of confusion. Don’t let this happen to you or your business.
The answer for trade secrets is different. If you don’t follow the rules, and take reasonable steps to protect your confidential or proprietary information, they will lose their trade secret status. If you feel something is important, you must be diligent to keep it secret.
Intellectual property can also be a pain, depending on your business
If you are a publisher or distributor of information, an Internet hosting company, or Internet service provider (ISP); chances are you deal with trademark and copyright issues regularly. Complaints come in, which cannot be ignored, regarding your customer’s use of allegedly infringing material. What do you do? Do you respond to complaints and immediately take down or remove material, risking upsetting your customers? Do you ignore complaints, risking potential lawsuits?
For companies that have to deal with this sort of thing, you really need to have a compliance policy. The compliance policy involves the right terms of service to your customers, as well as the right procedures for handling and evaluating complaints. For complaints involving copyrights, you must follow the guidelines of the Digital Millennium Copyright Act (DMCA) to ensure you are properly taking advantage of its “safe harbor” provisions to isolate yourself from potential lawsuits alleging contributory infringement.
L4SB can help you with your compliance policy, turning a headache into an efficient, streamlined and normal operating procedure.
Law 4 Small Business (L4SB). A little law now can save a lot later.
See our Intellectual Property Services