MaRS Library Intellectual property (IP) protection for startups
Whether your startup has no budget for intellectual property (IP) protection or has some financial resources to invest in it, the IP strategy should start with a similar analysis. Your startup must:
- Identify its business goals
- Identify any IP that it may have
- Formulate a plan to protect that IP and accomplish its business goals.
This article highlights the considerations for a business that is able to invest in IP protection.
Startup IP: Branding and marketing
Since the branding and marketing of a company is one of a startup’s most strategic IP assets, register your primary brand as a trademark. Then build goodwill in your other brands by using them with a ™ symbol to give notice to others that you mean to protect this brand.
When the time is right, it will be an easy business decision to register the other brands as well.
Licensing intellectual property
If the company has licensed any of its IP, then it may consider allowing licensees to use its trademarks to build goodwill in a brand on its behalf. However, there must be licensing agreements to govern this use and spell out the terms controlling the use of the brand or trademark involved.
Note: It is possible to license the use of common-law or unregistered trademarks.
Patent applications and provisional patents
Depending on your startup’s business goals, a company may file a provisional patent application or patent application as a form of IP protection—in the jurisdictions of interest, generally starting with the US and Canada.
Your startup can then opt to accelerate or manage the patent application process as required. Since bilateral agreements exist between patent offices, that is, the patent prosecution highway (PPH), it is cost-effective to not prosecute (pursue an application) in Canada and the US at the same time.
Businesses should pick one jurisdiction in which to have the patent issued, and then use the PPH to expedite prosecution in the other country. This saves effort, time and money.
Clear ownership of intellectual property
Another important issue is retaining clear ownership of any IP developed by independent contractors and employees.
Spend money on professional advice for independent contractor and employment agreements so that there is a clear understanding of what the company owns and what the contractor or employee owns.
The company will usually want to own everything in both cases, but that has to be spelled out precisely in writing. This also means that the chain of title to any IP will be well-defined.
Ensure that your agreements include provisions that require the contractor or employee to cooperate with your company in obtaining IP protection. This is especially required in the US, but, in practical terms, it will be important whenever IP rights are sought and enforced. Don’t wait until a problem has arisen to deal with this issue.
Copyright to protect your IP
Copyright arises automatically but registering copyright provides you with better protection. This is important for any company that creates copyright-protected material for use by others. Registering a few key copyrights (as opposed to a widespread approach) may be a cost-effective solution.
Once your company has the budget to do so, secure the value in your IP by obtaining broad and robust legal protection for it.
As well, seek legal services to identify and define what business agreements your company will accept, and have these set explicitly in writing.
Having clear documentation prevents misunderstandings and erroneous assumptions from harming valuable business relationships, including those with employees and independent contractors.
Note: The content in this article is for purposes of general information only. It is not legal advice.
Canadian Intellectual Property Office. (2011, June 23.) Retrieved June 24, 2011, from http://www.cipo.ic.gc.ca.
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