By John B. Farmer
What should you know about intellectual property (IP) to make it in business?
IP is becoming, and may already be, the dominant business asset of the U.S. economy. A study based on 1998-2004 data by Stephen E. Siwek of Economists Incorporated found that IP industries in the U.S. contributed 40% of U.S. business growth and that they account for 20% of private industry’s contribution to total U.S. gross domestic product.
Even businesses that don’t see themselves as IP-based increasingly depend on IP rights, such as keeping a clear trademark – a business or product name – in the age of the Web.
Unfortunately, nearly all business managers make common mistakes regarding IP due to a lack of basic knowledge about it.
Below, I’ve assembled a high-level list of the basic IP knowledge every businessman should possess. Perhaps it will be a useful to-do list for the self-improvement oriented.
Patents
A patent is the exclusive right to make, use, sell or offer for sale an invention, such new device or manufacturing process.
- What is a patent, what are the types of patents (e.g. device, business method) and what types of inventions can be patented?
- Employers, employees and contractors – who owns patent rights?
- Three criteria for patentability: an invention must be new, useful and non-obvious.
- How long do you have to apply for patent protection?
- Provisional patent applications vis-à-vis full applications.
- How to performing patent clearance for a new product or service.
- How to handle patent rights in employment agreements, independent contractor agreements and other contracts.
Copyrights
A copyright is set of exclusive rights to creative content, such as a book or computer program. It includes the right to make copies of and to distribute a copyrighted work.
- What is a copyright, and what are the rights of the copyright holder?
- Employers, employees and contractors – who owns copyright rights?
- How are copyrights created?
- Proper marking of copyright property.
- The process for and benefits of copyright registration.
- What constitutes fair use?
- How to handle copyright rights in employment agreements, independent contractor agreements and other contracts.
Trademarks
A trademark is name given to signify the origin of a good or service, such as the mark COCA-COLA.
- What is a trademark?
- Picking a trademark – a tradeoff between trademark strength and how much the trademark explains the product or service.
- How to clear the availability of a prospective trademark for use.
- Federal and state trademark registration – comparative benefits and costs.
- What constitutes trademark infringement?
- How to handle trademarks in commonplace business transactions.
- Proper labeling and usage of existing trademarks.
- Trade dress (a form of trademark) – what is it? How do you protect it?
Trade Secrets and Confidentiality
A trade secret is information that has value to a business because it has been kept confidential, such as a customer list or business plan.
- What can be a trade secret?
- Employers, employees and contractors – who owns trade secrets?
- Good business practices for identifying and guarding trade secrets.
- How to handle confidential information in pre-deal business proposals and negotiations.
- Key terms of confidentiality provisions in commonplace business deals, employment agreements, and independent contractor agreements.
- Non-competes and non-solicitation agreements, especially the requirement of reasonableness in time length, geographic scope and subject matter.
Strategic Thinking Regarding IP
- IP audits and how they are conducted.
- Basics of maintaining IP assets.
- Seeing the whole battlefield – creating and sticking to an IP protection plan.
- Using IP rights in a complementary or overlapping fashion to create protection.
- Choosing between patent and trade secret protection.
- Choosing between patent and trade dress protection.
So where do you acquire this knowledge? I won’t try to cover it here because I don’t know of any high-quality, single source and because addressing that issue would take lots of space. Business schools should make IP 101 a required part of the curriculum, but I don’t know of any school that does this well. Still, perhaps knowing what you need to know will be helpful.
John B. Farmer
Leading-Edge Law Group, PLC
804.343.3221 -- direct voice
804.363.4599 -- mobile
jfarmer @ leadingedgelaw.com
Three James Center
1051 East Cary Street, Suite 1130
Richmond, Virginia 23219
Post Office Box 1996 (23218)
804.343.1131 -- fax
www.leadingedgelaw.com
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