Intellectual Property Rights Applied in Business

Intellectual property rights cover a number of works that can be owned by individuals or companies. Intellectual property covers creations of the mind such as literature works, artistic pieces, and inventions. Intellectual property is divided into two categories of industrial property and copyright.

Intellectual property rights allow the creator to benefit from their work or creation through publicity or profit. Intellectual properties are recognized by the United Nations Declaration of Human Rights Article 27. Which says that everyone has the right freely to participate in the cultural life of the community, to enjoy the arts and to share in scientific advancement and its benefits and, everyone has the right to the protection of the moral and material interests resulting from any scientific, literary or artistic production of which he is the author.

In the United States, your work is covered by law provided you have your work protected by a patent, copyright, trademark, or trade secret. The work is covered under the Intellectual Property (IP) Policy of the United States Patent and Trademark Office (USPTO). The USPTO is responsible for the enforcement of active intellectual property claims and to develop new rules related to intellectual property. The website for the USPTO is the best place to look if you have a business idea you think is original and are not sure if a similar product exists or if you want to determine the merit or degree of individuality or differentiation of your product compared to another. If you determine you want to file for intellectual property protection you do so by applying with the United States Patent and Trademark Office.

What are the reasons to protect your property?

  • To promote future developments of creativity by other entrepreneurs.

  • Promotion of intellectual property and the ability to protect it results in economic growth and creates new jobs.

  • The creators of intellectual are likely to create additional intellectual property.

By protecting intellectual property we grow innovation and ingenuity in an environment which promotes creativity for the benefits of all.

Why is the protection of intellectual property beneficial?

  • Without it customers would have little confidence that the products they purchase were authentic.

  • Without protection, inventors and idea makers would have little incentive to pursue new ideas.

  • Recording industries, software companies, and publishing companies could not exist without copyright protection.

Intellectual property provides a great economic benefit to the economy into the bottom line of many business entrepreneurs. Intellectual property protection is important to prevent counterfeiting and profit laws from infringement. There are many examples available of companies losing many jobs and significant dollars in revenue based on intellectual property infringement. This encompasses a wide range of issues which impact the company such as paying to replace defective products, possible personal injury, and the goodwill and reputation of your company.

It is estimated that intellectual property accounts for approximately 1/3 of the value of U.S. corporations and is estimated in the trillions of dollars. This is no small impact on the business frontier. Part of the difficulty lies in the technological advances we have made and are increasing need to provide protection to computer based intellectual property applications whether they are created on a computer or stored on a computer.

The reason intellectual property is most important and entrepreneurial context is because a significant amount of innovation and intellectual property is developed at the small business level but it only for patents. Intellectual property is used to pull the small business establishing growth reputation and develop a market niche. These niches are what provides great value to respected buyers for investors.

Intellectual property types

Patents offer protection so that an invention cannot be made copied, used, or sold without the inventor's permission. Trademarks ensure that the owners have exclusive rights to the marks that identify their goods or services.

Other intellectual properties include Industrial designs. Industrial Designs are the specific designs that a particular company uses in development of its specific product. These designs can be two dimensional such as a pattern or color, or three dimensional such as the shape or surface feature of a product. Industrial designs are used to protect a number of products today such as clothing, appliances, or housewares. Industrial designs are aesthetic and cannot be functional. The other portions of a product that are functional must be covered by a patent. Industrial designs are what make products more valuable or provide it with increased marketability because the product is more attractive and desirable for consumers over other products.

Industrial design protection ensures that the person or company who has registered the design has exclusive rights and protections against unauthorized copy or imitation. Industrial designs must be new and original in order to quality for protection under industrial design.

Understanding Intellectual property rights

Intellectual property includes products which are products of the mind and are distinct from the usual notions of property such as equipment, land, or buildings. You can see and feel them. You can own them, sell them, or lend them to others.

Patents, copyrights, and trademarks were the first intellectual property rights to be recognized in law. In the context of the intellectual property rights most people think of these first. These intangible property rights are distinct and yet have several aspects in common.

The patent protects inventions, processes, or ideas that are not generally known, can be reduced to a tangible form, our valuable or useful to society, and are protected for a finite term.

The copyright protects original expressions of ideas that are creatively produced in a tangible medium for a finite term.

Trademarks protect a word, phrase, sign, symbol, shape, or label that is a distinctive identifier of the goods or services of the creator when placed in in the market that is used to distinguish goods or services from those of any other person or business for an indefinite term.

The willingness to recognize property rights in creations is a fairly new concept in relative terms to tangible property rights. Intellectual property laws create affirmative rights but are not an absolute defensive against infringement. Your Intellectual property can be one of your most useful and most used business tools. If you own patents or copyrights you will realize value from utilizing them in your own exclusive manufacture or production. If you own trademarks, you will use them to distinguish your business and your products or services, to grow your customer base and to promote your reputation. As the creator of intellectual property you are the owner unless you give away your rights to own them. Intellectual property may have some costs for the entrepreneur which include research and development cost, presentation costs, production costs, column and compliance costs, insurance costs, and marketing and distribution.

The depth and spread of intellectual property grows each day with new innovation. New systems and enterprises are developed which lead to revolving intellectual property reform that unleashes open innovation and growth for the new era of entrepreneurship. The growth of new intellectual property is tied to innovation. Intellectual property is seen as a business asset to help with corporate growth and asset protection. As new innovations are developed new forms of intellectual property are developed which must undergo a valuation. Rapid changes in technology and the creative force of free-flowing information will continue to put a premium on the creation and use of intellectual property.

Some would contend that the best way to protect intellectual property would be simply to keep it a secret, unrevealed to others. The difficulty with this point of view is that keeping secrets is quite possibly one of the most difficult human objectives to achieve. As a result of the recognition of this problem law has developed to provide protection of property to intellectual property owners.

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In the United States laws protecting intellectual property exist at both the state and federal levels. State laws cover a broad array of intellectual property fields ranging from trade secrets to the right of publicity. These laws differ from state to state.

The owner of a piece of intellectual property may still choose to protect it by keeping it secret either by literal secrecy or by contracts with employees that may have to work with the secret property that commit them not to reveal the nature of the property.

How to monitor for intellectual property infringement

If you own intellectual property it is your responsibility to protect it. The infringement can only be stopped once it is identified and reported to the proper governmental authorities. You want to make sure you have infringement monitors in place to look for unauthorized use of your intellectual property. You can do is internally by performing market searches, market analysis, or Internet search. You can do this externally by hiring an intellectual property watch service to monitor publications and applications related to your intellectual property. If you determine infringement has occurred you can take steps immediately to prevent future infringement occurrences by implementing cease and desist notifications. The next steps are arbitration and civil litigation if these notifications are not successful.

What to do if infringement happens

As an entrepreneur you should ensure the value of your intellectual property rights at creation. Ensuring your rights includes developing an intellectual property strategy, developing a budget, connecting your intellectual property with your business strategy, and developing preventive protection measures. Which are product is created and want to protect your intellectual product rights by registering your intellectual product, applying notices to it, actively using your intellectual product, keeping your eyes open for infringements, and preventing any infringements on your intellectual property.

As an entrepreneur you may acquire intellectual property rights by submitting a letter of instruction. You'll want to protect your intellectual property rights by using nondisclosure agreements such as those between the creator and a confidant, author and publisher, an employer and employee. If you determine your intellectual property rights have been infringed you will send a cease and desist letter. At the first sign of an infringement you may use a "cease and desist letter" to try to stop the suspected illegal activity. This procedure is a common and cost-effective method, and often produces results against individuals and smaller businesses, particularly if they have inadvertently used your intellectual property. Cease and desist involves the sending of a letter directly to the infringer and demanding that the infringer stop all infringing activities and acknowledge your intellectual property rights. Common verbiage in the letter includes a description of your company and a description of the infringement activity on your intellectual property you will demand the company or individual does the following:

  • Take all necessary steps to avoid any further infringing actions in relation to our company's intellectual property

  • Cease and desist all use of our company's intellectual property immediately.

  • Cease and desist from using any intellectual property confusingly similar to our company's intellectual property.

  • Take all necessary steps to transfer immediately to our company any and all registrations of intellectual property that are identical or similar to our company's intellectual property.

  • Destroy or order the destruction of all said infringing materials, information, products, and other items now in your possession or that come into your possession in the future.

  • Permit representatives of your company to inspect your premises during reasonable business hours and without advance notice to ensure that infringing products are not present.

You will ask they execute the letter by returning it to you as written assurance that they acknowledge. If the infringement continues and legal proceedings are brought, both parties will incur substantial expenses for attorney fees, court costs, investigative and discovery costs, and other litigation related expenses. They are also likely to suffer harm to their reputation among consumers and industry traders, loss of sales, loss of production, and potentially loss of the business. Settlement negotiations can take time, but they are usually accomplished in private without harmful publicity. The proceedings will determine consideration and costs each party will bear related to the settlement.

Developing a plan

As with any entrepreneurial venture proper planning lends to the best outcome. As the speed of information advances new issues arise with the protection of intellectual property. Historically we were not as concerned about hacking or engineering attacks on intellectual property. Computer hacking occurs on a daily basis. You can protect yourself by using this article on intellectual property rights and putting mechanisms in place to reduce your risk these include:

  • Nondisclosure agreements

  • Confidential disclosure agreements

  • Non-competition agreements

  • One solicitation agreements

  • Developing agreements for outsourcing and consulting

  • Providing adequate physical security

  • Using methods to prevent computer hacking

  • Using employee agreements

Performing a needs assessment

Business owners may not initially be aware that they need to protect your intellectual property rights. To perform a needs assessment you first need to identify the intellectual property that you own, consider ways to protect it, and determine the value of these assets. By performing an audit you will develop strategies to protect your intellectual property assets. You want to look at any specific processes, systems, formulations, methods, or instruments your business uses to develop intellectual property. You want to determine any advantages you have over your competition because of specialized pricing, marketing strategies, manufacturing processes, or product formulas. You also want to look at your total business operations and the underlying security.

Proper planning

In order to maintain a proactive stance in protecting intellectual property there are many items you should plan for relating to your intellectual property if the need to report an infringement occurs. Small businesses are more vulnerable to intellectual property theft because they have less experience in protecting intellectual property and corporations or may lack the expertise or financial resources to protect it or they simply may not know. There are many other measures you should look at in order to prevent the theft of intellectual property let's take a look of a few:

  • Keep your general information readily available and the local law enforcement contact number

  • Have a description of your intellectual property readily available including the estimated value, the cost to develop, the acquisition costs, fair market value if sold, and the estimated value.

  • Review and document the general physical security measures you have taken to protect your intellectual property

  • Describe security precautions such as fencing, security alarms, locking doors, or camera monitors

  • Describe the physical barriers to the building to prevent access such as "authorized personnel only" signs

  • Ensure you have a written security policy

  • Require employees to wear badges

  • Require employees to sign in knowledge mentor the security policy

  • Identify individuals in your company that are most knowledgeable on the security policy

  • Identify how many employees have access to your intellectual property

  • Identify if your intellectual property is only divulged on a need to know basis

  • Ensure that you use confidentiality and nondisclosure agreements

  • Ensure that you have a confidentiality policy

  • Ensure you protect computer stored intellectual property

  • Electronically stored intellectual property should be on the network protected by a firewall

  • Access should be limited to computer networks

  • Intellectual property should be stored on a separate computer server

  • Employee should be prohibited from bringing in outside computer programs or storage medium

  • Access logs to computer systems should be maintained

  • Documents must be controlled and marked confidential or proprietary

  • You should have a written process and policy concerning document control

  • New employee should be subject to background investigations

  • During exit interviews departing employees should sign they understand their obligation not to disclose intellectual property

You want to preserve any evidence of foul play concerning your intellectual property such as intrusion to a building, or computer server activity. This information will be reported to the US Department of Justice. The Department of Justice maintains checklist for reporting of intellectual property theft. In the event this occurs you will report basic information about your intellectual property and a description of the theft. This will include a list of possible suspects including their name, physical and e-mail address, physical address, their employer, and reason for suspicion. They will inquire as to whether the intellectual property was stolen to benefit a third party such is another business are competitor. They will inquire if the theft of intellectual property was committed to benefit a foreign government and if so you are to provide descriptive information. You will be required to provide information on any current or former employee nondisclosure agreements. You will identify any physical locations the intellectual property was stored. You will also provide any information on your internal investigation and if any civil enforcement actions have been filed.

Summary Reminders and Takeaways

Intellectual property rights cover a number of works that can be owned by individuals or companies. Intellectual property covers creations of the mind such as literature works, artistic pieces, and inventions. Intellectual property is divided into two categories of industrial property and copyright. Intellectual property rights allow the creator to benefit from their work or creation through publicity or profit. In the United States, your work is covered by law provided you have your work protected by a patent, copyright, trademark, or trade secret. The work is covered under the Intellectual Property (IP) Policy of the United States Patent and Trademark Office (USPTO). As an entrepreneur you want to take to work promote future developments of creativity by other entrepreneurs and promote intellectual property and the ability to protect. As with any other entrepreneurial venture you must take proper actions to plan for the prevention of the issues related to intellectual property including prevention of its release.