Intellectual property are the legal rights (control and ownership) of creations, such as ideas; inventions; designs, etc. for the use in commerce (Bainbridge, 2012). Intellectual law in countries seeks to deter individuals or organizations from copying or capitalizing upon another’s work. The main areas protected by protect intellectual property law include: patent, copyright, trademark, and trade secret. Intellectual Property can be categorized under the following:
Monopoly Right to prevent copying
De Facto Monopoly
Contractual
Patents Unregistered Trade Marks Trade Secrets
Confidential Information
Registered Trade Marks Unregistered Designs
Know-How
Registered Design Copyright
This essay focuses on Patents, Registered Designs, Unregistered Design Right and trademarks.
A patent is needed to increase innovation and competition. It is an issued document which is applied for and is granted by a governing body that states that an invention which is patented is legally bound to its owner for exploitation i.e. manufacturing, use, sales and imports. A patent is generally issues for 20 years and their costs generally depend on the stage of the application process. In the UK, the total cost of a patent could be estimated at £5000 over 5 years. International patents (PCT) on the other hand could total £7000 over 2.5 years. This is because within the UK, the examination of patentability stage is generally cheaper (£1500) compared to the International equivalent (£300) but most importantly the closing process in the International patent application could be in a range of £0 – £30,000, whilst the UK patent end stage is approximately £100 (HGF, 2014). Patents could give the product or idea not only a competitive advantage but create a market value as well. It enables the creators or inventors to have control over the product and can act as a springboard to launch other successful products.
On the other hand, Patents could be expensive and there is no guarantee of a grant but most important is that the secrecy that comes with patents does not necessarily equate to a better product or a good business idea for the product. This is a decision the inventor must take into account.
There is also a need to have a design protection system. The fundamental idea being that design protection encourages novel design and prevents rapid growth of identical designs because producers are blocked from copying. Visual appeal is a key factor in influencing the decision of buyers. It makes sense even more when the products serve the same function, the design of a product could potentially sway consumers, and therefore aesthetics are important (WIPO, 2004).
The main idea being that everyone needs to come up with their own design. There are two kinds of design rights:
a. Unregistered Design Right: is one where you do not have to apply to protect the product. It covers only 3D items because it protects the shape and configuration of the item and the right lasts from 10 -15 years. An interesting clause with the unregistered design, is that the license can be granted to other parties in the last five years. It also leaves room for an agreement on costs can be reached with the other party and the original producer of the item.
b. Registered Design: must be applied for at some cost. It focuses on giving the producer of the product, the right to own the looks of the product. In this instance, the protection right lasts up to 25 years but on the condition that a renewal fee is paid every 5 years in the UK and EU and the right protects both 3D and 2D features of a design (Intellectual Property Office, No date).
Trade Marks are used to indicate the source of goods and services and protect the public against confusing trade practices. Trademarks allow for competing between manufacturers and or traders to offer varying products within the same category and it does so by protecting the brand names that are distinctive, not currently used by other manufacturers for the same products or service and brands that are capable of being represented graphically. On the other hand, trademarks help with customers being able to identify and name competing products and make a decision for their purchase especially if there is a perceived difference based on quality or difference in price.
There are several categories of Trade Marks protection:
Unregistered Trade Mark: if the designer wishes can also be protected by law. In the UK it is referred to as tort law. The onus is on the manufacturer to prove that there is and has been someone using or representing the product as their own. In order to this, the manufacturer must prove:
• Product reputation i.e. in the public sphere
• That the “offending” trade mark has misrepresented and or damaged the original trademark
• In the UK, the damage tends to be in the form of revenue or lost customers.
Registered Trade Marks: The main benefit of applying for and subsequently registering trademarks seems to be the protection of product identity and not having to rely on legal proceedings in the form of passing off. This is again because registering gives proof of legal ownership and as with patents and designs, provides a monopoly if trade mark meets criteria. In terms of duration, protection lasts 10 years (Intellectual Property Office, No date).
The categories of trademarks are as follows
• Words: Include names of any sort, slogans, geographical names, etc.
• Logos, Shapes and or Signs: Company symbols like Car companies distinct mark, e.g. Jaguar car emblem or Mercedes star
• Sounds: a distinctive sounding product
• Colours and Shapes
• Smell: A distinctive smell to the customer that identifies or is associated with a product e.g. a recognised perfumed product
Both patents and trademarks have value. Patents can be seen as assets and literature shows that they can be valued i.e. patent valuation can be on a cost, market and or income basis. Literature also shows that patent valuation can also be subjective. A patent’s value often depends on the perspective. The inventor and or patent owner may value their product patent different to the investors and customers. Finally there are also arguments that a patent’s value depends on how the company acquired the patent, ultimately, a patent value can be integral to the success of a business.
Examples of the value of trademarks include:
• AOL acquisition of Time Warner Price paid: $147 billion, of which $128 billion was for IP (87%)
Examples of the value of patents include:
• Nortel, a former Canadian telecommunications company, had a patent portfolio of over 6000 patents. Notable companies like Google bidding; later sold to other notable companies including Apple, Microsoft, RIM, EMC, Ericsson and Sony for $4.5Bn.
References
Bainbridge, D. (2012). Intellectual Property. Pearson; 9 edition.
Department for Business, Innovation & Skills, Intellectual Property Office, (No date). Designs: How to Protect your Design. London: HMSO
Department for Business, Innovation & Skills, Intellectual Property Office, (No date). Trade Marks: Quick Facts. London: HMSO
Harrison Goddard Foote LLP, (2014). Intellectual property workshop
World Intellectual Property Organization, Intellectual Property Handbook, (2008).