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Intellectual property protection: The basics

Alyson Behr, Derek Slater | Sept. 7, 2017
Your company's intellectual property, whether that's patents, trade secrets or just employee know-how, may be more valuable than its physical assets. This primer covers everything from establishing basic policies and procedures for intellectual property protection.

The four legally defined categories of intellectual property for which theft can be prosecuted are: 

Patents grant the legal right to exclude anyone else from manufacturing or marketing your unique tangible things. They can also be registered in foreign countries to help keep international competitors from finding out what your company is doing. Once you hold a patent, others can apply to license your product. Patents can last for 20 years.

Trademarks are names, phrases, sounds or symbols used in association with services or products. A trademark often connects a brand with a level of quality on which companies build a reputation. Trademark protection lasts for 10 years after registration and can be renewed in perpetuity.

Copyright protects written or artistic expressions fixed in a tangible medium — novels, poems, songs or movies. A copyright protects the expression of an idea, but not the idea itself. The owner of a copyrighted work has the right to reproduce it, to make derivative works from it (such as a movie based on a book), or to sell, perform or display the work to the public. You don't need to register your material to hold a copyright, but registration is a prerequisite if you decide to sue for copyright infringement. A copyright lasts for the life of the author plus another 50 years.

Trade secrets can be a formula, pattern, device or compilation of data that grants the user an advantage over competitors is a trade secret. They are covered by state, rather than federal, law. To protect the secret, a business must prove that it adds value to the company — that it is, in fact, a secret — and that appropriate measures have been taken within the company to safeguard the secret, such as restricting knowledge to a select handful of executives.

IP can can simply be an idea as well. If the head of your R&D department has a eureka moment during his morning shower and then applies his new idea at work, that's intellectual property too.

 

How do you keep intellectual property safe?

If your IP is stolen by ne'er-do-wells, catching them is hard, prosecuting them is harder, and getting the stolen information back — putting the proverbial cat back in its bag — is usually impossible. In this area, a little paranoia is quite helpful, because people really are out to get you. That’s why it’s important for the CSO, CISO, and chief risk officer (CRO) to be involved in protecting IP. Consider these real-life examples.

  • An engineer regularly had lunch with a former boss now working for a rival, and fancied himself a hero for gathering competitive intelligence. The information he was giving up in return caused his employer, formerly the market leader, to lose three major bids in 14 months.
  • Immigrant scientists from Eastern Europe who were working on an American defense got unsolicited invitations from their home countries to speak at seminars or serve as paid consultants. The invitations appealed to them as scientists — they wanted to share information about their work with peers. The countries saw this kind of intelligence gathering as cheaper than research and development.

 

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