Intellectual Property Asset Management

How to identify, protect, manage and exploit intellectual property within the business environment

Claire Howell, David Bainbridge

• Publisher: Routledge
• Year: 2014
• ISBN:
  9781317911234
• Edition: 1
• Topic: Law
• Subtopic: Law Theory & Practice
• Index: Law

In the new 'knowledge-intensive economies' Intellectual assets increasingly play a key part on balance sheets. There is an increasing global awareness that in order to promote innovation and the growth of the economy, businesses must fully recognise and exploit their intellectual assets. A company's ability to innovate rapidly and successfully is now regarded as essential and most breakthroughs are made by Small and Medium-sized Enterprises (SMEs), usually with no in-house legal professionals to help them. It is essential that those working with or creating intellectual property rights (IPR) are aware of the basics of Intellectual Property Law.

Intellectual Property Asset Management provides business and management students at all levels with an accessible-straight-forward explanation of what the main Intellectual Property rights are and how these rights are protected. Locating the subject squarely in a business context and using case studies and examples throughout drawn from a wide range of business organisations, it explains how an organisation can exploit their rights through licensing, franchising and other means in order to make the best possible use of their IP assets.

This book will provide students with:
• the basic Intellectual Property law knowledge needed to identify a potential IP issue
• the tools and understanding to assess an IP breach
• the ability to identify where the problem cannot be solved in house and where expert legal assistance is required
• the knowledge required to work effectively with lawyers and other legal professionals to achieve the desired outcome

Chapter 1

Introduction to Intellectual Property Rights

Intellectual property rights (IPR) are of vital importance in all forms of business and commerce, industry and manufacturing, creativity and the arts, pure and applied science and engineering, and marketing and advertising. In many cases, intellectual property (IP) is one of an organisation’s most important assets. In some cases, it is the most important asset and the organisation would soon go out of business without its IPR. The music and film industries would not exist in anything like their present form without IPR. Why go to all the trouble and vast expense of making a film if anyone can copy it and distribute the copies, perhaps using the internet to do so?

Without patent protection pharmaceutical companies would not invest enormous sums of money in their pursuit of new pharmaceutical products. Without protection for trade marks, counterfeiters would have a field day and consumers would lose the ability to tell a genuine product from a fake. We could end up driving around in our cars on substandard counterfeit tyres. Without IPR, the creative arts and innovation would be stifled. Given the importance of IPR, it is essential that we all know something about them and acquire and use them to protect our creativity, innovation and business name and reputation. The purpose of this book is, therefore, to give the reader some understanding about these rights and how they are acquired and maintained, how they may be exploited and their nature and limitations.

This introductory chapter gives an overview of IPR and explains their basic nature and differences between them. This sets the scene for the other chapters in this book. By the end of this chapter, you should be able to answer the following questions.

What are intellectual property rights?

What sort of things are protected by each intellectual property right?

How are intellectual property rights classified?

What is the scope of each intellectual property right?

Do I have to register my intellectual property rights?

Can a given thing be protected by more than one intellectual property right?

How long do intellectual property rights exist for?

How do I get protection in other countries?

How do I grant rights to others to use my intellectual property?

How can I sell my intellectual property rights or acquire someone else’s intellectual property rights?

What are the pitfalls of disregarding intellectual property rights?

The purpose of this book is to give readers an understanding of IPR so that they will be able to manage them more effectively and gain maximum economic benefit from them. Only with a reasonable understanding can one hope to manage IP successfully and proactively so as to maximise its value; to know how to identify it, acquire it, transfer ownership of it or license it; and to be able to assess the value of an IP portfolio.

What are intellectual property rights and what do they protect?

The term ‘intellectual property’ covers a number of rights, some of which are quite different in their nature and scope to others, that protect creativity, innovation and business reputation.

Generally, they are treated just as other property rights and can be transferred to another person, and rights to others to use the protected subject matter can be granted. They can even be mortgaged and used as security for a loan.

Before proceeding further, it is worth briefly describing each of the IPR. The main ones for the purposes of this book are as follows.

• Registered trade marks – the names, logos and other identifiers of trading undertakings are protected by registering them as trade marks, which prevents others using signs that are identical to or similar to the registered marks. Examples of well-known registered trade marks are Pentium^®, KODAK, Routledge, Coca-Cola^® (the ^® denotes that the mark is registered); in many cases, trade marks consist of words, sometimes in stylised form, and/or images.

• The law of passing off protects business goodwill that has been built up in relation to a trading name or ‘get-up’. This gives an informal form of protection that overlaps with trade mark law, but the protection can be weaker although it can have more extensive scope. Older examples include the shape of the Jif lemon and the words Advocaat and champagne (this is now a protected designation that can only be used by producers in the Champagne region of France).

• The law of confidence protects secret information such as trade secrets; these can vary from secret industrial processes to relatively mundane information about customers and clients.

• Patent law protects inventions for products or processes that are new, involve an inventive step and have industrial application. The range of inventions protected by patents is quite breathtaking, from mechanical inventions (see the Dyson Technology patent for an upright vacuum cleaner patent No GB 2495125) to leading-edge biotechnological inventions (see the US patent No US 8,329,170 B2, belonging to Janssen Biotech Inc.).¹

• Copyright protects creative and derivative works such as literary and artistic works, music, films and broadcasts; the sorts of thing protected by these rights are undoubtedly the most familiar to us.

• There are other rights described as rights related to copyright such as a special form of protection for databases (some of which may be protected by copyright) and rights in performances. Databases may be computer databases or a manual database such as a card index; rights in performances are given to persons making a live performance (for example, singers or stand-up comedians) and to recording companies that have exclusive licences with them.

• Designs are protected by registration and/or by unregistered design rights. These rights protect new shapes applied to articles, graphic designs, ornamentation and such like, which may be applied to a vast range of articles from toys to furniture to motor vehicles to household goods to computers and mobile phones. Almost every form of technology and craftwork can be protected, providing they are unlike existing designs or are not commonplace.

There are other forms of protection, such as for plant varieties and a special extended form of patent protection for medicinal products, but these very specialised rights are not discussed further in this book.

How are intellectual property rights classified?

IPR are a mixed bunch and some are completely unlike others. Therefore, classifying these rights is not easy. Some distinctions may be made to separate some of the rights from others. For example, some of the rights are only available after registration, whereas other rights come into being automatically, once the subject matter has come into existence. Table A sets them out on this basis.

A number of points may be made.

• For the registered rights, the process to obtain registration can be quite different. For example, patents are granted only after an extensive search and examination process. As they are the most powerful form of IP, giving strong monopoly rights, patents are reserved for those inventions conforming to very strict rules as to novelty and inventive step. In contrast, most trade marks and designs will be accepted for registration, providing the basic requirements are satisfied, only if they are not opposed by others having similar marks or designs.

• Registered rights are normally monopolistic in nature. The justification for this is that the registrations are held in publicly available registers that can be consulted by the public or potential competitors.

• The rights not subject to registration, ‘informal rights’ or ‘soft IP’, normally require proof of copying to show infringement of the right. Thus, it is permissible to create a work of copyright, such as a photograph, that looks very similar to an existing work, providing it has not been copied from that work but has been created independently.

• Some of the informal rights last much longer than others: for example, most works of copyright are protected for the life of the author of the work plus 70 years. The maximum duration of a patent is usually 20 years only.

The scope of intellectual property rights

IPR work by giving their owners certain specific things that they can do in relation to the protected matter to the exclusion of everyone else.

Table A

Rights which must be registered (often referred to as ‘hard IP’)	Rights which come into being automatically (often referred to as ‘soft IP’)
Trade marks	Goodwill protected by the law of passing off
Patents	Information protected by the law of breach of confidence
Registered designs	Copyright
	Database protection
	Rights in performances
	Unregistered designs

For example, the owner of a registered trade mark is given the right to use that trade mark for goods or services specified in the registration. He can prevent anyone else using an identical sign for the same goods or services or using an identical or similar sign for identical or similar goods or services if this causes confusion among consumers as to the origin of the goods or services concerned.

The owner of a patent for an invention can prevent someone else making, importing, selling, etc., a patented product where the patent is for a product or using a patented process.

The owner of the copyright in a literary work can prevent anyone copying the work, making it available or communicating it to the public, performing it in public, broadcasting it or making an adaptation of it.

These are just some examples showing the scope of the rights. However, the rights are not absolute. The rights will only be infringed if the act complained of falls within the scope of the right and is not otherwise permitted. For example, it is not an infringement of a trade mark to honestly use one’s own name. It is not an infringement of a patent to carry out a repair on a patented product such as where a bearing in a patented motor has worn out. There are many ‘permitted acts’ under copyright law. These are acts that may be carried out without the permission of the owner that do not infringe copyright. One example is making an accessible copy of a literary work for a blind person, such as a Braille version. Another is making use of a work for criticism or review or for the purpose of reporting current events.

Apart from such acts that do not infringe, there are numerous defences to infringement actions. For example, it is a defence to a copyright action to show that the amount copied was not a substantial part of the work in question.

Other areas of law may also limit the scope of IPR, such as competition law. For example, if a person buys up all the patents covering a particular technology in order to prevent competition and drive up prices, he may be fined heavily under EU law. If a patent is not being worked sufficiently to meet demand, third parties may apply for compulsory licences under the patent.

These controls are not solely the domain of monopoly rights and may apply to informal rights such as copyright: for example, in the case of the Microsoft corporation bundling its own internet software with its computer operating system software.

Must intellectual property rights be registered?

The short answer is ‘no’.

The informal rights (‘soft IP’) cannot be re...