19 November 2015
IP protection is a must for small businesses
Counterfeiting and intellectual property (IP) infringements have been around for a long time. And smaller firms are at high risk because sharing business plans and pitching new products is necessary to win a key contract or to encourage investment from third parties. However, corporate lawyer Simon Deans highlights the cost-effective and practical tactics which can be implemented to discourage infringement.
Consider relationships between stakeholders
It’s worth considering the relationship between business owners and who owns the IP from the outset. It could save hundreds of thousands of pounds of litigation in the long run and encourages business owners to face any difference of opinion from the beginning rather than further down the line when a lot more money is at stake.
Confirm IP ownership in employees’ contracts
Current legislation implies that IP rights developed by an employee in the course of employment will belong to the employer. However, employees are better deterred from infringement if their obligations regarding IP are included in their contract.
Ensure all contractors have written contracts
Always ensure there is a clause in the contract that transfers ownership of IP created during the contractor’s tenure to you, the employer, otherwise it is likely they will own the IP in the works they create for you.
Always ask new clients, business partners or investors to sign a Non-disclosure agreement (NDA)
Before presenting to an external party, ask them to sign a non-disclosure agreement to maintain strict confidentiality. This will also confirm that you are the owner of the design or idea. If making a presentation, ensure the trademark, copyright notice and/or branding is across all material.
Copyright protection exists automatically in the UK. The challenge is to prove which party created the copyrighted content first. Computer files can confirm this. Or post a copy to yourself (without opening) as the postmark is proof of date.
Register your patents
Even though patent protection is supposed to last for 20 years, it can be expensive to register and to maintain this protection if IP rights are challenged. But having the patent does give a supposed monopoly, which can be a huge commercial advantage in the long run.
Monitoring the competition
Regular online searches will help smaller businesses identify perpetrators and take action to prevent them from any further breaches.
Contacting the perpetrator directly
A legal letter to a UK competitor containing solid evidence of IP infringement and requesting an immediate cessation, could be enough to discourage any further violation.
Considering where the business will trade
If a small business has a good idea as to where it intends to trade globally, then it should consider how IP rights are protected in those markets and whether it risks infringing someone else’s IP in that country. Fees for translating all relevant documents into the local language to secure IP registration, should also be considered.
Terms and Conditions (T&Cs)
If licensing the IP, it’s tempting to replicate terms and conditions from a previous contract to speed things up and finalise the deal. But it’s essential that all T&Cs are tailored to each business transaction. They should also be incorporated into the contract from the outset and agreed by both parties rather than falling into the trap of printing legal terms on the back of an invoice only to find they are not enforceable.
For legal advice on protecting your IP contact Simon or a member of the corporate legal team at B P Collins LLP on 01753 279022 or email firstname.lastname@example.org