Tips for managing intellectual property

woman designing a logo at pcHave you protected your business assets? Tracey Singlehurst-Ward, of Hugh James, explains the advantages of a proper IP strategy.

Recognising intellectual property assets, and protecting them so that they can be exploited for their true value, is an issue that businesses fall down on far too often.

Sadly, that can ultimately lead to lost value and costly litigation. The key, therefore, is to simultaneously keep an eye on the intangible as well as the tangible assets.

What are intellectual property rights?

Intellectual property rights protect valuable intellectual input in something new or novel. English and Welsh law recognises many types of intellectual creations, and offers different ways to protect them. Some require the creator or owner to take proactive steps to obtain protections from the law, and some do not. The most common rights are:

  • copyright
  • trade marks
  • unregistered marks
  • patents
  • registered designs
  • unregistered designs

There are myths around many of these, but most often around copyright. This is an automatic right arising by operation of law through the Copyright, Designs and Patents Act 1988. This prescribes that authors (or creators) or original works of certain kinds will have exclusive rights to exploit those works, whether literary, artistic, musical or other. The Act prescribes what activities a person can undertake with the work (copying, reproducing and so on) and the rights to prevent others from doing so.

There is no need to register copyright in a work (despite the common assumption, influenced by laws of other jurisdictions). Provided the work qualifies, the owner will acquire the rights prescribed. The rights might, of course, be assigned later down the line.

Other forms of ‘automatic’ right arise in unregistered marks and unregistered designs. Again, legislation and common law operate so as to create enforceable rights for owners of certain intellectual creations to prevent misuse by another. The law of passing off is relied on frequently both as a standalone action and together with trade mark infringement claims.

Trade marks need to be registered. The Intellectual Property Office (IPO) maintains the register of UK trade marks. Many choose to register their mark on an EU-wide basis with the European Union Intellectual Property Office too, and in wider jurisdictions. Trade marks, once registered, create an exclusive right to use the mark in the classes in which it is registered. They also put the world on notice of the existence of that mark, making it not only easier to police infringement, but also discouraging the use of similar marks in the first place.

What advantages can be gained from a proper IP strategy?

There are very good reasons to invest in specialist intellectual property advice and a good strategy, for example, to:

  • attract investment
  • develop the business
  • protect the business from competitors
  • protect the business structure, the future of assets and improve exit
  • avoid disputes
  • raise finance
  • raise income
  • maximise tax incentives

The consequences of failing to manage and protect intellectual property

Proper management and maximising of intellectual property requires an element of policing.

Failing to protect IP properly could cost an owner or business not just sums of money, but also, in some cases, the entire value of the business.

The growth in intellectual property litigation is impossible to ignore. We have seen a year-on-year rise in the number of cases pursued both in the courts and through the resolution procedures with the IPO. The Intellectual Property and Enterprise Court particularly has an increased workload, with its streamlined service and cost and damages caps. Despite this, the cost of having to pursue enforcement action can, for some SMEs in particular, simply be too much to take on.

Top tips for managing intellectual property

Invest in the right advice early on

Advising on protection is almost always cheaper than enforcement later on.

Some procedures for registered rights can be quite cheap and effective for clients. For other, more complex rights, the value is dependent on the market demand for the invention. However, given the critical importance of protecting information from the public domain, in some cases, legal advice should be the first priority.

Identify and monitor IP

Intellectual property audits allow clients to get a 360-degree view of their assets and identify opportunities or issues.

Identify an IP strategy

Ongoing legal advice should consider short, medium and long-term goals for exploiting intellectual property and be designed to enhance and protect the assets.

Value your IP portfolio

Usually no lawyers will be needed for this, but it is crucial to identify prudent business plans.

Company names and/or domain names

Registration of a company name at Companies House and appropriate domain name registrations will not provide rights to stop others from using a particular name, or prevent competitors from successfully taking action against you for trade mark infringement. Beware of cyber squatters.

Registered designs

The design of product packaging is often as important as the branding. Where a product or packaging is new and looks significantly different from items already on the market, a registration of that design is a valuable tool to combat ‘lookalike’ products. 

Make contracts watertight

Relationships internally and externally in any client’s business should contain appropriate protections.

If a dispute arises, specialist advice should be sought as soon as possible

The sooner you obtain advice, the sooner you will be able to make informed decisions about how to proceed.

Keep records

Keep development records, designs, correspondence, advice – everything.

About the author

Tracey Singlehurst-Ward is a partner in the dispute resolution group at HughJames@HughJamesLegal.