Intellectual Property enforcement basics for SMEs

Aleck Ncube

INTELLECTUAL Property is a valuable tool small businesses can use to protect different aspects of their creative activities.

While there are various categories of intellectual property inherent in the everyday business operations of small businesses, there are several elements in these categories of intellectual property (IP) that have little to do with each other.

For example, there is often no need to register a copyright in a work; it exists upon the creation of a copyrightable expression and lasts for the entire life of the creator plus another fifty to seventy years.

On the other hand, to receive a patent in an invention, an inventor must apply for a patent and be issued a patent, the duration of which is generally 20 years.

Not only are the various types of IP different from each other; they are also protected differently depending on their jurisdiction.

The manner in which an SME must go about protecting and policing its intellectual property is dependent upon the type of IP it has and the jurisdiction in which it is located or does business.

It is generally the IP owner’s responsibility to act as his or her own policeman.

This three part write-up on the enforcement and policing of IP by SMEs will examine trademark, patents and copyright.

These are the three major categories of intellectual property. It will look briefly at industrial design and trade secret law.

In conclusion, it will look at how the formulation of a thorough and fair contract can overcome some of the issues in business dealings, which can help protect intellectual property from misappropriation.

The focus is on low-cost policing activities and mechanisms that have proven useful for SMEs around the world.

Elements of an SME’s IP policing plan should include: recognition of responsibility to monitor one’s own products as well asproducts in similar lines of goods and services and taking stock of all the IP inherent in one’s business.

This can include a vast array of things, including a primary product itself (copyrighted music CDs, trademarked handbags, patented medications), client lists (trade secret), dedicated accounting software (possibly a business method patent).

Learning the basic IP law of the country in which the SME is based and the major countries in which the SME does business, such as export markets.

If feasible, an IP rights holder should apply for protection for trademarks, industrial designs and patents in these countries.

If an SME is considering bringing suit against an entity that is infringing its intellectual property, it should assess its chances of winning a case and calculate the amount of compensation and/or damages and attorney’s fees that would be at stake.

An SME should also calculate the amount of money it is losing or will likely lose in the future due to the infringement. This week, I focus on policing and enforcing trademarks.

Trademark

From handbags to batteries, counterfeit products are flooding the market place, flying in the face of the tenets of any given country’s trademark law.

The specific components of a trademark law depend on the countries in which the trademark owner operates.

Some things to keep in mind — again, depending where an SME is doing business — include: translating the SME’s name, phrases and/or slogans.

If doing business in China, for example, an SME should consider filing both the English name and its Chinese characters.

An SME should file its trademark within the categories that it belongs, keeping subcategories in mind. Checking these subcategories for similar trademarks filed by competitors and/or infringers could be helpful in staving off future infringements.

While there is something of an international “clearinghouse” mechanism through, which trademark owners can apply for protection in several jurisdictions at the same time, there is no universal or international trademark law.

The clearing house mechanism is administered by the World Intellectual Property Organisation (WIPO) and is called the Madrid System.

An applicant’s home country must be a member of the Madrid system and the trademark must have been registered or successfully applied for within that country.

National or regional trademark offices maintain a register of trademarks, which contains full application information on registrations and renewals.

This enables trademark examination, search, and potential opposition by third parties.

A trademark provides protection to the owner of the mark by ensuring the exclusive right to use it to identify goods or services.

The period of protection varies from jurisdiction to jurisdiction, but a trademark can be renewed indefinitely if its registration and use in commerce is maintained.

Trademark protection is enforced by the courts, which in most systems have the authority to block trademark infringement.

Trademarks also protect prospective consumers by providing a means through which they can identify goods or services withwhich they have associated a certain quality or characteristic they like.

Enforcing Trademark

Trademark infringement is generally inclusive of “passing-off” but it is important to understand both infringement and passing-off individually.

Trademark infringement is an act punishable through a legal statute that will spring from whether the mark is included in a national trademark registry and whether a third party uses a trademark that would cause a likelihood of confusion amongst the public.

Trademark registration is available for both goods and services.

Typical remedies for trademark infringement include injunctions, damages and an account of profits.

A trademark owner can do a number of things to inform the public that his good or service is protected under trademark law.

Passing-off, generally not a statutory violation, is when a third party misappropriates another’s trademark and misrepresents that mark to the detriment of trademark owner’s goodwill or reputation; that is, that third party markets or sells his own goods as if they were branded by another entity. Be diligent.

Firstly, a trademark owner can use the ™ or ® symbols on the item. The ® symbol indicates that the mark has been successfully registered.

Secondly, he/she can look at trademark registrations periodically to see whether someone is registering a mark that is similar enough to his/hers that it might cause confusion.

Thirdly, he/she can maintain awareness of products or services being sold in the same or similar category and, if need be, send a cease and desist letter to anyone who is using his trademark without his permission.

Be selective in choosing franchisees

The “goodwill” of a trademark depends on several factors.

Amongst these is the degree to which it is recognised and the qualities that the public associates with the brand.

As a trademark owner, it is important to gauge how much quality control oversight will need to be exercised when licensing your trademark to a franchisee.

A contract should be drawn up between the owner and the licensee, stipulating what the franchisee may and may not do with the trademark. In Part II, I will focus on how SMEs can enforce and police their patents.

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