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What's the go with Intellectual Property (IP)?
What's all the fuss about something called IP?
So, what does 'IP' stand for? Industry Professional? Incompetent Partner? Individual Privacy? Yes it could mean all of these things but it also stands for Intellectual Property.
“What the hell is that?” you may ask…
This blog is the beginner's guide to Intellectual Property and how to identify and protect it within your business, even before you launch it!
What is IP?
It is the ideas, thoughts, processes & creations which are in the heads of the people within your organisation. Once the ideas are taken out, reduced to writing or registered (trademarks, patents, registered designs) then they become the intellectual property of your organisation.
IP acts as both a shield from exploitation and a bargaining tool for licensing or selling of your businesses assets to investors. It rewards the owners of such rights and also provides the purchaser of these rights with confidence that IP is protected and not going to leave or be exploited without compensation.
It’s kind of a big deal!
How do I know whether my business has IP?
The above diagram sets out the different types of IP which can be identified within your business.
A patent is a right that is granted for any device, substance, method or process that is new, inventive, and useful. A patent is legally enforceable and gives you (the owner), exclusive rights to commercially exploit the invention for the life of the patent.
Requirements for registration:
- Must not be published/used by the public; and
- Patentable subject matter (useful and of commercial value); and
- Novelty (idea needs to be new or have some degree of inventiveness or non-obviousness); and
- Inventive step with a substantive examination process (20 year registration); or
- Innovative step with no substantive examination process (8 year registration).
A common trap people fall into is telling their family, friends and work colleagues about their idea before exploring whether it is something that needs to be protected. Once you spill the beans on your idea, you are putting it out to the public for someone to tell someone else (and so on) and you run the risk of someone beating you to the punch line and registering a Patent BEFORE you! It is always better to have a Non-Disclosure (aka Confidentiality Deed) signed by anybody who is going to hear your idea.
2. Registered Designs
Registering a design protects the unique appearance of one or more visual features of a product including shape, configuration, pattern, and ornamentation.
Requirements for registration:
- Design is ‘new’ or ‘distinctive’ when compared to a prior art base according to the informed user;
- Has an author;
- Has not been released into the public domain; and
- Registration is for 5 years + 5 year (renewal).
You may have a product which has a unique appearance of one or more visual features of which you are producing these goods in mass quantities for sale (eg. art on T-Shirts, towels etc). If you don't register a Registered Design (when you qualify to have one registered), you may also lose any Copyright which might subsist in the artwork or design. If you don't look into this BEFORE you launch your designs to the public for sale, it could be too late to protect yourself from copy-cats!
It is very important to consult an Intellectual Property Lawyer prior to launching your products to ensure you are protecting your rights so you don’t become subject to copyright violation and cheap rip-offs being made of your products.
Copyright protection is automatic whenever a literary (books, manuals, compilations), artistic (photographs, drawings, sculptures) or musical work is created. It also captures sound & video recordings and computer programs.
The most common misconception amongst business owners is using images without the permission of the photographer who took the image, for social media posts, websites, and marketing material. Copyright exists in these images and the ‘author’ (or person who took the photo) has a right to be named as the author along with the use of the image. If you fail to do so, you could subject yourself to a lawsuit for violation of copyright.
Requirements for substance:
- Original work (not copied);
- The traditional works have an author or authors (must be human and not a monkey);
- No registration system in Australia, but is in Canada, China & USA.
- Term is life of author + 70 years (literary, dramatic, musical, artistic) – term differs according to work.
When you’re posting on Social Media using other people’s images, always recognise the author of the image e.g. by saying “Image taken by Jade Weller”. If you are unsure who the image was taken by, simply say “author unknown”, allowing the true author to come forward.
4. Trade Marks
Trade marks can be a letter, word, name signature, numeral device, brand, heading, label, ticket, the aspect of packaging, shape, colour, sound or scent or a combination of these. It is used to distinguish one trader from another.
A registered trade mark gives you the legal right to use, license or sell within Australia for the goods and services for which it is registered. Let’s explore the types of trade marks available for registration.
Requirements for registration:
- Distinctive (capable or is actually distinguishable as goods or services in the marketplace)
- Capable of graphical representation
- Term for 10 year period + additional 10 year periods if renewals are paid & kept up to date
- The symbol ® is used for registered trade marks.
Types of Trade Marks which are able to be registered:
Corporate name – sometimes the corporation provides goods or services together with the brands it supplies. Register both!
Packaging – can be registered in some occasions if you can divorce the brand name from the trade mark registration. Prevents competitors from producing copycat products.
The shape of product – if you can successfully register a trade mark for the actual shape of your product, it is incredibly valuable.
- Toblerone chocolate
- Belt buckle
- Highlighter Pens
Product attributes – a very desirable feature of the product and people think that the feature is associated with the brand. Eg. the red tip bananas have a red tip so you can distinguish which farmer produces them.
Colour marks – Eg. Red bull, Australia post and the red wax applied to the tips of bananas - distinguish itself from the market place and develop a brand from a commodity good.
Mascots & characters - the mascots are used in connection with the products sold.
- Caramello Koala,
- Ronald McDonald,
- Freddo Frog, etc.
Slogans & jingles – (‘oh what a feeling’) can be registered as a word mark and also as a sound (of music that goes behind the words or combined with the words and sounds. It can be registered in note form or as an actual recording.
Scents – provided there is sufficient evidence that people associate that smell with your goods. Must be able to distinguish your products from others. Eg TM 1241420 - Eucalyptus smell in association with golf trees.
A common misconception with trade marks is thinking that a Business Name Registration is a trade mark registration. A business name is registered with the Australian Securities Investments Commission whereas a trade mark is registered with IP Australia. They are two separate Government agencies and hold different rights. You must conduct searches on IP Australia's website before you select a business name to ensure that you are not infringing another's trade mark. You should also register your trade marks in the countries which you intend to manufacture and sell. Every country has their own IP register and some countries don't allow you to use the trade
5. Trade Secrets
Trade secrets are confidential information which provides a business with a competitive edge. It encompasses manufacturing or industrial secrets and commercial secrets. The most popular examples of trade secrets are the KFC's herbs and spices and Coca Cola's recipes.
Requirements for substance:
Information not to be publicly available;
Info must be treated carefully; and
Generally governed by agreement or employee contract (or in some cases, governed by equity or law).
If you would like to establish a trade secret as part of your business, be sure to have everyone sign a Non-Disclosure (aka Confidentiality Deed) and limit the amount of people who will know your secrets.
Human Capital is the ideas which employees of the business have on how to do something better, more efficiently, new product/service and general processes or skills which take time to learn.
- all of the collective skills of the staff including management
- how they do things and also key relationships.
Requirements for protection:
Reduce the human capital down into writing so you are reducing the ‘flight risk’ of your intellectual property.
Have policies & procedures in place to extract that human capital into writing.
It is common for employment contracts to contain clauses which stipulate that innovations or inventions created during business time, on the business premises or using business's assets are deemed to be ideas of the business. You should ensure that you have appropriate Human Resources (HR) and contracts prepared to protect your business. If you can't afford to hire a HR Manager, you can contract companies on a part time basis to provide HR Managers for your business.
7. Circuit Layouts and Plant Variety
This type of IP is quite complex and isn't typically found in most businesses. For more information about this, please visit IP Australia.
To summarise the above, here is a list (not exhaustive) of common IP within your business:
- Website (Copyright in the coding of your own website as well as the images, layout etc.)
- Business name (trade mark)
- Innovative products or services
- Trade Marks
- Trade Secrets
- Artwork (Copyright)
- Supplier & customer lists
- Customer Databases and data & trends
- Social Media followers
- Distinctive packaging designs
- Customised software
- Internal business processes (Human Capital)
- Exclusive agreements with customers/suppliers/distributors
If you have any of the above, you should consult a lawyer that specialises in IP. Please feel free to reach out to us for a few referrals. If you would like to engage JadeStart to lodge a trade mark application for your business, click here.
Please note that this does not constitute legal advice and is for information purposes only. You should seek legal advice if you believe you have intellectual property within your business.
To your ongoing success.
NOV 01, 2017