Maximizing and ProtectingYour Intellectual Property by Dale W. Malik firstname.lastname@example.org
Agenda• What constitutes Intellectual property (IP)and how do you have any?• The Importance and Value of Intellectual Property (Stories from the frontline)• Making money from your IP• Protecting your IP from competitors• Business continuity and Employee IP coverage• Q&A
What Constitutes Intellectual Property?• Patents• Copyrights• Trademarks• Trade Secrets
The Importance of IP• Dip and Dots (A lesson learned the hard way)• Qualcomm ( High yield at low cost)• Nortel (Hidden value in a company gone bust)• IBM (A business unit un to itself)• What about your company?
Looking for IP Value and Risk in Your Company• What are the tangible elements of what makes your product or service different?• What elements of your business, if a competitor had them, would change the value of your company?• Where are the single points of knowledge and information that are critical elements of your business?
Patents• (Utility, Design, or Plant) protect inventions and improvements to existing inventions.• What cannot be patented: – Laws of nature and Physical phenomena – Abstract ideas – Literary, dramatic, musical, and artistic works (these can be Copyright protected – Inventions which are: • Not useful (such as perpetual motion machines); or • Offensive to public morality• What can be patented – utility patents are provided for a new, nonobvious and useful: – Process – Machine – Article of manufacture – Composition of matter – Improvement of any of the above
So You have a Great Idea Does it Pass the Test• Novel• Non-obvious• Adequately described or enabled (for one of ordinary skill in the art to make and use the invention)• Claimed by the inventor in clear and definite terms
To Patent or not to Patent• Can anyone reverse engineer what you have designed?• Is there a short shelf life on this design or market changes that would make it obsolete?• Do you have the resources to pursue one?• Are you planning to raise capital?• Have you developed something that another industry or market could use?
The Patent Process• It takes 3-5 years for a Patent to issue?• Protection begins from the moment you file (pending), but is not legally enforced until it issues.• Having a plan of what you want to stake your claim to, is critical and must be done right.• Costs to file 1 patent can range from $4,000 to over $10,000 depending on complexity and type.• Patent laws are changing from “First to Invent” to “First to File”. This is a critical change that will affect how you protect your business.
Valuating Patents• Defensive cost of doing business• Protects investors in your company• Creates an intangible factor of being a innovative company.• Enables licensing to other industries and companies.• Investment firms will perform a valuation as a capital asset.
What are CopyrightsAny material you create for your company can be, and should be copyright protected. But you must mark the material with as being such (2012 Copyrights reserved by “EO Company”). • Training materials • Manuals (all “how to” guides) • Marketing materials • Presentations • Media – music, videos
What are Trademarks and Service Marks• Trademarks are typically Logos/Designs that a company uses that are uniquely identifiable and distinguishes the source of goods to be that company. But it can be a word, phrase or combination as well.• You must register and maintain them with the USPTO. Failure to do so will invalidate your claim and damage your brand.
Trade Secrets• Anything that your company creates or has knowledge of that is not known outside your company.• Protecting them is critical and can be done via – Non-disclosure agreement (NDA) – Contract (embedded NDA) – Proprietary markings – Limited access and control
Shh…It’s a secretAll companies have secrets. Some are technical suchas the detailed specification of a manufacturingprocess; some are business-related such as a list ofcustomer names and addresses, which would beuseful to a competitor. Some are of enormous value,e.g. the recipe for Coca Cola; others are lessvaluable. Some are simple, even one word long, suchas the name of a company takeover target, othersare complex, such as the details of a plannedadvertising campaign. The common factor is that allcan be protected.
In recent years, many countries have introduced lawson the protection of confidential business informationalong the lines proposed by the Agreement on TradeRelated Aspects of Intellectual Property Rights(TRIPS), which states that for information to be legallyprotectable:1. the information must be secret, i.e., not generallyknown ore readily accessible to persons that normallydeal with that kind of information2. It must have commercial value because it is secret;3. The owner must have taken reasonable steps tokeep it secret.
Making Money from IP• Licensing it to non-competing companies• Licensing it to other industries• Creating alliances and cross licensing to build an industry specific portfolio.• Selling elements and retaining free usage rights.
Protection from Competitors• Having an IP defense plan is important and knowing what your competitors have is critical to survival if you go to battle. (See TiVO).• Most companies will cease and desist if notified of an infringement in writing. They will ask for proof, and you will have an opportunity to sell them access if it makes good business sense.• Cross licensing and trading is quite common and good for business.• Non-disclosures are critical to identifying and structuring methods for sharing information.
Non-Disclosure Agreements• When do you need them?• What should be in them?• Are governed by state laws and vary as to what you can put in them.• Should have very a very definitive description of the boundaries of what is being shared.• Should have reasonable time limits before expiration.
An NDA story• On December 21, 2006, Robert Emmel signed a non-disclosure agreement with News America Marketing In-Store, LLC. This LLC is a part of Rupert Murdochs News Corporation that performs in store marketing, such as "coupon and promotion dispensers, in-store video, at-shelf signage and floor and shopping cart advertising."• Emmel had been terminated by News America the month before in November 2006. Before his termination, Emmel had provided several government entities, including Senator Charles Grassley (R-IA) of the Senate Finance Committee, with confidential documents from News America. (Emmel believed News America had engaged in fraud against its customers, predatory and anti-competitive schemes, and inflated its earnings.)• The NDA Emmel signed on December 21 barred him from disclosing any confidential information—broadly defined—or from disparaging News America.• The NDA was written in a way that it did not cover his actions up to signing the agreement, and he was not in violation of it and the courts through out the case.• The moral of the story – Make sure your NDA really covers the intended protection.
Protecting Your IP Assets from Employee Abuse• NDA’s• IP assignment rights• Creating an Employee IP agreement• They take more than Blood - Even the Red Cross has one…
So you want to work for the Red Cross … Sign Here “Confidential Information” shall include but not be limited to: (i) information relating to Red Cross’ financial, regulatory, personnel or operational• matters, (ii) information relating to Red Cross clients, customers, beneficiaries, suppliers, donors• (blood and financial), employees, volunteers, sponsors or business associates and• partners, (iii) trade secrets, know-how, inventions, discoveries, techniques, processes, methods,• formulae, ideas, technical data and specifications, testing methods, research and• development activities, computer programs and designs, (iv) contracts, product plans, sales and marketing plans, business plans and (v) allinformationnotgenerallyknownoutsideofRedCrossregardingRedCrossandits• business, regardless of whether such information is in written, oral, electronic, digital or other form and regardless of whether the information originates from Red Cross or Red Cross’ agents.• “Intellectual Property” shall include but not be limited to: (i) all inventions, discoveries, techniques, processes, methods, formulae, ideas,• technical data and specifications, testing methods, research and development activities, computer programs and designs (including improvements and enhancements and regardless of patentability),• (ii) trade secrets and know-how, (iii) all copyrightable material that is conceived, developed, or made by me, alone or with• others, (iv) trademarks and service marks and (v) all other intellectual property.• Intellectual Property shall only include intellectual property created by me: (i) in the course of Employment or using Red Cross time, equipment, information or• materials, and (ii) with In one(1)year after termination of Employment and relating directly to wor kdone during Employment.