The Start Column: An Intellectual Property (IP) strategy

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The START column: Ownership of a private company versus ownership of the company’s properties – the shareholders’ limitations
  • a must-have for businesses in today’s technological world

The need to adapt to the ever-changing customer/consumer demands and market realities is driving businesses to be innovative at a never-before-seen pace in order to stay relevant and competitive. This trend is further driven by the roles technology and human ingenuity are playing in finding solutions for the many challenges being witnessed across consumer/customer touchpoints. To be able to compete, grow and expand, businesses cannot discount the value of ideas underlying the development of new solutions (products and services) in today’s enterprise management.

Nowadays, innovations have become widespread and prone to imitations, reproduction and copying. The development of an IP strategy is becoming the best option to develop and protect innovations and their underlying ideas which in most cases may have gained considerable values higher than the real properties of businesses.

In this article, I will discuss some factors to consider when developing an intellectual property (IP) strategy for a business, especially start-ups as well as provide information on the protection regimes available for innovative ideas.

Intellectual Property (IP) assets and rights

When we use our brains (minds or intellects) as humans, our ingenuity sometimes leads to the creation of unique products or services, inventions or works which others may not have contemplated or worked on previously.

Therefore, intellectual property consisting of assets and rights is only concerned with the intangible creations of our minds which are capable of legal protection. Generally, intangible creations including invention, process and formula, the expression of one’s talent reflected in a painting, brand name, design and so on are considered as intellectual property assets, while the legal protections that secure these assets against their unauthorized use by others such as copyrights, trademarks, patents, trade secrets among others constitute intellectual property rights.

Instructively, one must own an intellectual property asset which is novel, unique, new, or original to be able to secure protection through any of the intellectual property rights as may pertain to one’s asset – without an intellectual property asset, one cannot seek to secure or assert any intellectual property right.

The rationale for the protection of intellectual property assets is to recognize and reward individual (sometimes collaborative) efforts in the creation of innovative solutions to the exclusion of others – although there are permissible processes that allow the use of one’s creations by others.

Intellectual Property (IP) rights recognised in Ghana

The legislative framework offering protection for intellectual property assets in Ghana is generally consistently with global practices. Legislations are in force to secure protections for Copyrights, Industrial Designs, Patents, Trademarks, and Unfair Competition.

These primary intellectual property protection legislations supplement internal company efforts such as Trade Secrets, Contractual rights, Policies etc. to secure protection for a company’ intellectual property assets.

Copyright, the most common form of intellectual property right is a temporary right which safeguards an original work of authorship which is literary (textual) or artistic (graphic) in nature, compute software or programs, music, sound recordings, etc., fixed in a tangible medium making it perceptible either directly or with the assistance of a machine or device from being copied. It protects the form in which the idea or concept is expressed by exclusive control but not the idea or concept itself and excludes abstractions or anything technical or functional. For instance, there is no copyright in the idea of singing a song but in the form or way the song was written.

Without registration, one can sue for copyright infringement if he or she can prove that the copied work was his or her original work, because copyright attaches automatically as soon as the work is demonstrated in a perceptible and reproducible form.

Also, Trademarks as an IP right seek to secure a company’s commercial identifiers, distinguishing them as a company and its services or products. Trademarks protect brands and more precisely, the names, logos, or other insignia by which a brand is known, thereby protecting the distinct features that allows consumers/customers to easily identify products and services. It also covers non-functional characteristics such as configurations., design marks, trade dress or service identifiers. The primary requirement for a trademark registration is that the mark is distinctive, unique, and not descriptive of the product or service being identified.

Inventions on the other hand are protected by Patents. A patent registration gives an inventor or entrepreneur, the exclusive right to the use of the invention or an area corresponding to the invention covering both the product and/or the manufacturing process.

Although an elaborate registration process, involving the complete description of the invention is required, it grants a license to prevent or stop or sue others from using, manufacturing, selling, licensing or otherwise exploiting the invention covered by a patent.

Nonetheless, not all inventions are patentable. An inventor must satisfy the patentability test which includes among other things addressing the issues of utility (the practical usefulness) of the invention, novelty or innovativeness, non-obviousness (not apparent to a skilled person) among others.

Furthermore, Industrial Design rights protect the aesthetic appearance of a product from third party replications that are overly similar to the registered design.

Trade Secret happens to be the most protective form of an original idea if same could be kept as such and disclosed on the need-to-know basis only. Companies such as Guinness, Coca Cola, Pepsi etc. have been global beneficiaries of trade secrets as an intellectual property asset protection tool – they have over centuries managed to keep as a secret, their drink formula without any formal legislative registrations of same.

A Trade Secret could include any information which makes the products or services unique and provides competitive advantage such as customer list, supplier list, details of marketing campaigns, or information of commercial value. This rationale is to maintain information derived from a company’s efforts with economic value – either actual or potential from disclosures.

The attempt to keep information confidential can only be considered as a trade secret where such information constitutes part of a commercial setting. Therefore, one’s secret jollof recipe cannot be considered a trade secret until such secret recipe has been commercialized and used in a trade. Other exceptions exist as defenses to a claim of trade secret over disclosed information, and businesses are encouraged to familiarize themselves with the full scope of trade secrets, including the risks associated with them as an IP protective form.

Regardless of the type of intellectual property right one seeks to enforce or lay claims to, legal avenues including court action are available to reclaim or be compensated for an infringement of one’s intellectual property right.

Some considerations for developing an IP strategy

It is vital for business owners to understand that, while the law generally provides protection, it remains the responsibility of the right holder to take the necessary steps to secure and enforce his/her rights in a timely manner. I cannot be prescriptive of the best strategy a company should adopt in this regard.

However, I consider an understanding of the unique product or service offerings, the processes and systems, company set-up etc. as the first important step to developing an IP strategy for a company.

To me, an IP strategy must seek to achieve the following:

  1. Protect the intellectual property assets of a company.
  2. Limit a company’s liabilities for the use of IP assets of others.
  3. Establish a culture of innovation for the creation of new IP assets.

 

  1. Protecting intellectual property assets of a company

Once IP assets have been recognised, steps must be taken to secure and protect them for the exclusive benefit and use of the company. To achieve this, IP registrations must be done timely with the relevant statutory bodies. The strategy must ensure a process is instituted to identify, profile, and pursue the registration of any IP assets. Other elements of the strategy could outline processes and personnel for IP portfolio creation, the classification procedure for trade secrets, deliberate inclusion of IP asset protection clauses in employee contracting and non-disclosure agreements or non-competition agreements with 3rd parties.

The protection strategy must emphasise the importance of evaluating options for protection with identifiable lines of approvals to prevent exposures rather than protecting innovative ideas by registration – which may not always be the best form of protection for IP assets which can be considered as trade secrets.

  1. Limiting a company’s liability in the use of IP assets of others

A company cannot have an IP strategy that only focuses on the protection of its IP assets from unauthorised use. Relatively, the nature of a company’s business may necessitate the use of others IP assets. As part of a company’s IP strategy, a clear outline must be established to guide employees and managers on the acquisition of IP licenses or assignments, consents, and permissions before using IP assets belonging to others in the company’s production, manufacturing, or service delivery process. This will help limit the company’s exposure to IP liabilities and infringements claims.

  1. Establishing a culture of innovation for the creation of new IP assets

Innovation thrives in the right environment. Creating a culture where employees are encouraged to be problem solvers, innovators and thinkers usually based on a recognition or reward scheme may lead to new ideas (innovations) over which the company may exercise IP rights over.

Therefore, an IP strategy must recognise people as the source of IP assets and be deliberate about how the workplace can engineer innovations. To ignore the human factor may result in only protection for existing ideas or innovations without creating the room for new ones – and no company today can survive on the ideas of yesterday.

A culture of innovation is critical for the survival of companies and every company must find a unique way to promote that at its workplace and such initiatives must be part of its IP strategy.

Conclusion

It has become imperative for every business to include an IP strategy as part of its business management strategy. However, the development of an IP strategy must align with an understanding of the company’s product and/or service offerings, processes and systems, competition, among others. And a good strategy must not only focus on offering protections for a company’s IP assets but must also look at ways to limit the company’s liabilities in using IP assets of others as well as the creation of a culture of innovation for the generation of new ideas capable of Intellectual Property protections.

>>>the writer is the Managing Partner of SUSTINERI ATTORNEYS PRUC (www.sustineriattorneys.com) a client-centric law firm specialized in transactions, corporate legal services, dispute resolutions, and tax. He also heads the firm’s Start-ups, Fintech, and Innovations Practice division. He is reachable at [email protected]orneys.com

 

 

 

 

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