By: Mason Cole
When it comes to protecting your business’ intellectual property (IP), the mantra “launch first, patent later” should never be a part of the plan. Think of your IP as currency — it is the foundation on which a business stands. If your business begins to experience growth, then protecting the IP will be critical to the long-term success of the company.
Trade Secrets and Non-Disclosure Agreements
Protection of your intellectual property does not begin until the United States Patent and Trademark Office (USPTO) grants the protection. In order to keep sensitive information safe until the USPTO grants ownership, keep it on a need-to-know basis to prevent possible leaks. Creating non-disclosure agreements (NDAs) and including provisions in employment contracts will also assist in safeguarding trade secrets as well as IP that is critical to the business. In addition to keeping sensitive files in a secure location, a business should also invest in cyber security to prevent trade secrets from being spread online.
Trademarks, Patents and Copyrights
The three most common forms of protection are trademarks, patents and copyrights. Selecting the correct category will depend on the type of work a business wishes to protect.
A trademark protects words, names, symbols, sounds or colors that identify goods and services. They are frequently used to protect a business’ brand. A trademark lasts for 10 years with the option to renew it for an additional 10 years at its expiration. Registering a trademark adds a new level of protection by expanding coverage to a federal level.
Patents cover inventions, from machines and industrial processes to product formulas. While under the protection of a patent, the owner can prohibit the manufacturing, selling or use of the invention in the United States. Unlike trademarks, patents have a limited lifespan of 20 years. Once they expire, anyone can obtain access to the information.
The protection of stories, artwork, songs, graphics and other artistic works falls under the coverage of a copyright. The length of protection of a copyright lasts the lifetime of the creator, plus 70 years. After its expiration, the work becomes public domain and can be used by anyone. Copyrights begin when the work is created, making registration voluntary. Unregistered work may not be eligible for damages and attorney fees, so registering the work is recommended.
When a business starts to implement new product ideas and beings to obtain licenses, they should identify which facets of the company need to be protected. The process can take months, so starting the paperwork and procedures early is advised. As mentioned above, avoid disseminating sensitive details about any intellectual property until the patent is approved by the USPTO. Otherwise, there is risk that competition may use the products, designs or ideas. Should infringement occur, the first step is to issue a cease and desist letter. While a business can send the letter itself, it is much more effective when it is from a lawyer. If that fails to stop the theft of IP, request a court injunction to stop the offender. Final steps may include filing a lawsuit, in which working with a qualified, professional attorney is heavily recommended.
Protecting a new product of business idea is similar to purchasing insurance. Business owners typically do not expect their brand to be replicated, but if it does happen it can reduce the company’s income. If infringement occurs on unregistered work, then there is a greater risk that the violation will go unpunished. While there is a chance that intellectual property may never be stolen, it does happen, and having proper registration will reduce many complications.
Mason Cole, founding partner of Cole Sadkin, LLC, focuses his practice on intellectual property. Whether you are looking to start a small entrepreneurial business or wanting to protect the next million-dollar idea, Mr. Cole specializes in guiding you from the initial incorporation or trademark to your exit strategy and every stage in between.