For many businesses (particularly start-ups and SMEs) the upfront cost of obtaining registered intellectual property (IP) rights can be daunting. However, securing such rights, whether it be a trade mark, patent or design registration, can be hugely valuable. Registered IP rights secure you a certain monopoly over your competitors, give you more robust legal weapons to enforce your IP, and provide intangible assets that can be sold to third parties.
This article is published in the EMA Business Plus magazine.
No matter the size of your business, it is worthwhile developing an IP protection plan. What are your target markets? Are they primarily in New Zealand or elsewhere? What IP rights do you have or do you hope to have? Depending on the nature of your business you might need to consider trade marks, patents, designs, copyright, trade secrets, confidential information and licensing.
Below are some tips to help you maximise your investment.
Copyright in New Zealand arises automatically
In New Zealand, copyright arises automatically in an original work. Copyright protects the expression of an idea (rather than an idea itself). Copyright may exist in packaging, a logo, marketing material, and even the product itself. If you are unsure whether copyright exists in a particular work, ask an IP specialist.
If someone copies your copyright work without permission you may be able to enforce your rights, but you will need to prove (amongst other things) that you are the owner of that copyright and that the work is an original work. Good record keeping is paramount. Retain the original drawings of your packaging, your logos, and your products (this includes electronic drawings and designs). Ensure that these are dated and that the author and the author’s location are identified.
Importantly, the author of the copyright will be the owner of that copyright unless a contractual relationship shows otherwise (eg. employment). Retain copies of employment agreements or contracts commissioning any works. Having the author sign a deed assigning ownership of copyright at the time that the work is created can save you a lot of time and possible heartache later.
Register trade marks in your key markets
A registered trade mark provides you with a certain monopoly of use of that mark in respect of particular goods or services. A registration also provides notice to the world of your rights, and a confusingly similar mark will not be registrable for similar goods or services. Importantly, you can only sue for trade mark infringement if you have a trade mark registration. It is a lot simpler enforcing rights in a registered trade mark than relying on “use” and “reputation” rights in an unregistered mark.
At the outset, consider adopting a distinctive name or logo. The more distinctive (and less descriptive of what you do) the stronger your rights will be. “KODAK” for cameras, an invented name, is an example of a good, distinctive brand name.
Make sure you undertake marketplace searches to ensure that someone else does not already have your intended name or brand. Search the trade marks register and the internet for any similar brands. An IP specialist can undertake thorough “freedom to operate” searches for you.
Trade marks are registered in respect of particular goods and services. Think carefully about your current business but also the direction that your business might head in the future. Your trade mark registration will be more useful if it covers the full spectrum of goods/services that your business provides and intends to provide.
Ensure employment and contractual agreements protect future IP
IP disputes often arise out of employment and contractual relationships. It is imperative to ensure that you adequately protect yourself in writing at the outset of these relationships and make it clear who will own any IP arising from the relationship. Also make sure you include clauses that protect your existing IP (including confidential information and trade secrets).
Some important questions include: who will own the IP? Who will bear the cost of ensuring any new IP rights are vested in the appropriate party? Are any other limitations necessary, such as the parties’ rights to use, licence, register, or sell rights in the future?
- Identify your target markets and prepare an IP protection plan.
- Good record keeping is essential for copyright – keep your original drawings, packing designs, products and copies of all agreements and contracts.
- Choose distinctive brand names and consider protecting these with a registered trade mark in your target markets.
- Ensure you own your current and future IP, and record this in writing with employees and external parties.