The Importance of Intellectual Property Protection
Intellectual property protection is important for any business, regardless of size. When IP is protected and managed effectively, it can become a valuable commercial asset. In fact, according to the former president of the International Federation of Intellectual Property Attorneys, there is “evidence that SMEs that apply for patents, trademarks or designs are more likely to grow quickly and succeed than those that do not.”
But what qualifies as ‘intellectual property’ and how is it protected?
There are several different types of intellectual property rights, and protection depends on the specific type of work, product, service, idea, or asset that an applicant is looking to protect. Generally, intellectual property protection may be afforded to original works of authorship, inventions, designs, slogans, logos, trademarks, and brand names, among other items.
Copyright
Copyright is a form of IP protection available to creators of “original works of authorship.”
Types of works covered by copyright include: musical works, dramatic works, literary works, motion pictures and other audiovisual works, architectural works, sound recordings, pantomimes and choreographic works, pictorial, graphic, and sculptural works.
Copyright owners have a bundle of exclusive rights, including the exclusive right to reproduce copies of their work, authorize others to exercise exclusive rights, distribute copies of the work, and more.
Copyright protection in the U.S. lasts for the life of the author plus an additional 70 years.
Under the U.S. Copyright Act, copyright protection vests initially in the author or authors of the work. However, there are situations where it is not clear who the author is, what part each author contributed, or whether the author is the party paying for the deliverable or the party creating it. To deal with some of these questions effectively, copyright owners are generally advised to register their copyright with the Copyright Office, and to seek assistance of counsel when entering into IP transactions, such as copyright licensing agreements or similar commercial arrangements.
Patent
A patent gives exclusive rights to an inventor of a novel invention. To qualify for protection, an invention must be either a process, machine, article of manufacture, or composition of matter. In addition, it must be useful, new, and non-obvious. A patent provides numerous rights including excluding others from using, making, or selling the patented invention. Patent protection in the United States lasts for 20 years for utility patents and 15 years for design patents. Generally, the rights provided by a patent are only applicable in the country in which the patent has been granted. Global businesses often have patents in multiple countries. Because of their unique character, patents often prove to be very important and valuable assets for companies.
Trademark
A trademark is a form of IP that protects words, symbols, or phrases used in commerce to identify a particular manufacturer or seller’s products and distinguish them from the products of another. Under some circumstances, trademark protection can extend beyond words, symbols, and phrases to include other aspects of a product, such as its color or its packaging. Trademarks are important to the consumer impression goods or services evoke, as customers tend to notify trademarks and associate them with specific companies.
Trademark protection in the U.S. may, under certain circumstances, arise through use of a trademark in a specific market. However registering a trademark has multiple advantages, including the fact that registration provides protection throughout the U.S., it serves as prima facie evidence of ownership, and provides certain advantages in the event of litigation.
Protection of registered trademarks does not have a time limit. As long as the trademark is in actual use in U.S. commerce, and the filing formalities are complied with, the owner can benefit from the protection of its trademark registration perpetually.
Selecting a trademark and achieving registration can be a complicated process, as there are many considerations associated with every step of this process. A trademark cannot be registered if there is another filed or registered trademark which predates the relevant application. For this reason, it is crucial for applicants to conduct a trademark clearance search prior to filing their application.
Similar to patent protection, trademark protection is limited to the territory where the trademark was registered. Therefore, businesses with global operations typically register their trademarks in multiple jurisdictions.
Benefits of IP Protection
The benefits of IP protection are multiple, and they apply to small businesses, start-ups and large corporations equally.
Exclusive Rights
IP protection gives businesses exclusive rights to their inventions, creations, designs, and trademarks. This prevents competitors from copying or stealing their ideas, and helps businesses avoid inadvertently infringing third party rights. Exclusive rights help businesses maintain their competitive edge.
Brand Recognition
One of the primary reasons businesses seek IP protection is to help build their brand and create customer loyalty. Registering a trademark can help businesses differentiate their products or services from competitors and establish a brand that consumers know and trust. As a business grows, brand recognition grows and ultimately, a brand may become a very valuable asset for the business.
Attracting Investors
IP protection can make a business more attractive to investors. Investors are more likely to invest in a business that has protected IP because it shows that the business has a unique selling point and a competitive advantage. Small businesses with IP protection can also be more attractive for acquisition, as any registered IP right is an asset.
Revenue Generation
Small businesses can create new revenue streams by licensing or selling their IP to other businesses. Carefully crafted licensing agreements can provide a valuable source of income for small businesses and help them grow and expand without having to raise more money from investors or lenders.