Intellectual property (IP) is the most significant point of discussion among Patent Lawyers, Trademark Lawyers and investors deciding whether to invest in a start-up.
There’s a good reason for this – in the present market scenario, the success of a new business venture will depend on the people creating it, their intellectual property, and that “something else” factor which makes it unique. This is why it is essential to protect new business owner assets by avoiding the top five intellectual property mistakes.
Look at for example, the Shark Tank investor discussions where quality intellectual property protection is a key deciding factor.
The following is for general information only. Always seek the advice of your Patent Attorney or Trademark Attorney before acting – otherwise your intellectual property rights could be jeopardised, made invalid, or lost to a third party.
1. Unclear IP ownership, or unable to define ownership
Generally, the right of intellectual property ownership belongs to the people who have started the venture in the first place. But this situation becomes muddied and confused when an outside person or agency is hired to create or improve IP. To avoid this situation, it is recommended, from the outset, to specify the ownership details in a legal contract.
It is preferable to have this drafted in the proper form by a contract lawyer. Then, how do you determine whether the work belongs to (for example) the creator, their company or a hired contractor? If all the rights are assigned to the company, then the hired contractor can’t claim ownership.
2. IP loss or dilution
IP loss or dilution is a massive risk for any start-up, if a previous employee can place a claim to be an inventor or creator of the original IP. These cases are generally not taken to court until or unless the start-up is a huge success and the previous employee notices that success. It is important to gain continual guidance from your Patent Attorney or Trademark Attorney so that the correct steps are always taken.
3. Creating a witty brand name that can’t be used
Even if a start-up has registered their brand with the state as a business or company name, and established a domain name, it doesn’t mean that the start-up is allowed to use that name widely in their business. There are many cases where a business or company name is closely related to an already existing one in the marketplace.
This is why the start-up then undergoes some legal difficulties, like receiving a cease and desist letter from an existing company. To keep this from happening, you can check the Patent Office for the name of a qualified Trademark Lawyer who can provide a consultation, to advise you and protect your IP.
4. Mixing up different types of Intellectual Property and its protection
As a novice, it can be confusing to deal with trade secrets, trademarks and inventions – is it a Trademark or a Patent that you need? Doing extensive research and approaching the right Patent Lawyer or Trademark Lawyer will keep you from making common mistakes.
5. Investing too much in patents
To obtain a patent, it is essential that your new process or product is valuable, non-obvious and new, and described in enough detail that it can readily be reproduced by a person with the relevant technical expertise. It can be confusing, difficult and costly to deal with competitors copying your original idea and prevent them from impacting your business. However, obtaining a patent is a costly and slow process and may not pay off in the long term, depending on what you are trying to achieve.
IP has a definite role at every stage of the business lifecycle. For a newcomer starting a new venture, heavy emphasis should be placed on securing and identifying IP. Once you begin hiring for business, formal agreements and contracts become paramount in ensuring the future and current IP of the company. With time, the company innovates and grows – its IP will be increased and enhance the company’s value. Therefore, having an IP strategy is essential for getting the most worth for your business.
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