intellectual primer for small business oct 2011
DESCRIPTION
The strategic management of intellectual property assets can give SMEs a proprietary market lead, improve their competitive positioning and enhance their enterprise value. It is, therefore, important that small businesses have a proactive approach to stimulate the creation and management of their IP assets. Learn the basics of Intellectual Property (IP) for your small business and how to protect and leverage your IP assets for business success. This session will remove the mystique around patents, trade-marks and copyright and explore how you secure them and what they might cost.TRANSCRIPT
Enterprise Toronto Small Business Forum
Intellectual Property: A Primer for Small BusinessesPresented by:Rubsun Ho
[email protected] @rubsun
October 18, 2011
© 2011 Cognition LLP
What’s a legal session without a disclaimer?
The information provided in this presentation represents a general overview and understanding of intellectual property issues. It is not intended to be used as legal advice. Any application of the contents of this seminar in the context of a specific business should entail further legal consultation and consideration.
© 2011 Cognition LLP
About Cognition
Founded in recognition of the fact that traditional legal services model was too expensive for startups and growth companies
Virtual model means lower overhead and lower rates
Former In House lawyers (e.g. Canadian Tire, RIM, Nortel, Sun Microsystems, etc.) who also practiced on Bay St (e.g. Gowlings, Stikemans, Oslers)
32 lawyers in Toronto & Ottawa
© 2011 Cognition LLP
Intellectual PropertyA 15 Minute Overview Employment and Contractor Issues Contractual Relationships Trademarks Patents Copyright
© 2011 Cognition LLP
You Have an Idea...
“A couple of friends and I are going to develop some software in our free time”
“I can’t quit my job because I’ll still need the income while we get our software off
the ground”
© 2011 Cognition LLP
IP Issues in Employment
One of the first due diligence checks is to examine the chain of IP ownership
Generally, an employer owns IP created by an employee in course of employment
Copyright Act says copyright created by employee in the course of employment is owned by employer
Employment agreements tend to have very broad assignments of IP to employers, especially if a related business and/or if using the employer’s “tools”
Don’t burn any bridges with old employer – you may need their signoff in the future
© 2011 Cognition LLP
You Decide to Incorporate
“Going Rogue Inc.”
We design and market software and applications to make individuals
incompetent and unfit for public office.
© 2011 Cognition LLP
You Decide to Hire Some Consultants
You hire two guys from Destroy a Party Inc., a market leader in the design of
political incompetence software.
© 2011 Cognition LLP
You Decide to Hire Some Consultants
Unless otherwise agreed, default position with a contractor is that the contractor owns the IP
Ensure you have a written agreement where contractor assigns ALL IP rights to your company (including all derivative rights) and waives moral rights.
Be careful of disclosing confidential information to consultants, especially trade secrets.
Ensure that the consultant isn’t really an employee in disguise, or your company will be liable for statutory deductions and fines
You Secure Some Funds and
Hire Employees
© 2011 Cognition LLP
Employment agreements should explicitly reserve IP rights to the employer
Agreement needs to be signed PRIOR to start of employment
Some employment agreements may ask an employee to list any pre-existing IP he or she owns
Ensure that employee doesn’t use any IP appropriated from previous employer
Watch for Non-competes
© 2011 Cognition LLP
Your Software Gets Traction…
…and you find an organization that loves the incompetence software and is willing to distribute your product to the mass market
1st Step: NDA Ensure that it is mutual Pay attention to definition of
confidential information – does it need to be marked?
Check to ensure that confidential info is destroyed or returned on termination
Watch for “residuals” clauses
© 2011 Cognition LLP
Your Software Gets Traction…
…and you find an organization that loves the incompetence software and is willing to distribute your product to the mass market
2nd Step: Commercial Agmt Anything customized? Who owns IP? Beware IP Indemnities Ensure that they are responsible for
actions of their own employees and subcontractors in maintaining confidentiality
© 2011 Cognition LLP
You’re Ready for Product Release
You decide that a great product name for your incompetence software is “Misunderestimated DX”
However, a trademark search discloses that W Inc., a giant in the political incompetence industry, already uses the
mark “Misunderstimate”
While W Inc. does not produce software, because it is such a leader in the incompetence space, your product may
be confused with their organization.
© 2011 Cognition LLP
Trademarks
Trademarks: words, logos or symbols that identify your products or services and distinguish them from those of others.
Should be distinctive and not descriptive or it may be objected to
Must be in use to maintain registration Search www.uspto.gov and www.ic.gc.ca (as well as NUANS
search) You develop trademark rights just from usage in advertising and
selling the related product or service Mark any usage with a TM or SM
Registration is not necessary, but gives you rights across the country, can give indefinite ownership, allows enforcement over social media channels (e.g. Twitter) and provides clearer ownership ®
Ensure that you develop and enforce trademark usage guidelines
Registration - $1500 - $2500 plus more for international
© 2011 Cognition LLP
You Decide You Need a Patent
Everyone is telling you that you need a patent to raise financing.
You’ve heard that W Inc. has a number of patents how to be incompetent.
You think you have a unique method to make people incompetent, and don’t
want competitors copying your methodology.
© 2011 Cognition LLP
Patents
A patent is a temporary right, granted by a governmental body, that gives the holder a limited right to exclude others from selling or offering a similar invention.
The invention has to be useful, novel (i.e. innovative) and non-obvious.
Typically lasts for 20 years. Could take 4-5 years to be granted. Can be used for offensive or defensive
purposes.
© 2011 Cognition LLP
Patents
Cost: $10K - $25K, plus $5K+ for each extra country
Cost of a patent infringement suit: $2M to $5M Prior art search: www.uspto.gov Don’t always know what has been filed but not yet
published In US/Canada: one year from disclosure of invention
to file for patent. In Europe, you can’t file after invention has been disclosed.
Canada: first to file. US: first to invent (until March 2013).
Provisional patent: establishes filing date and gives you 12 months to amend it. Cost: $3K to $5K
© 2011 Cognition LLP
Your Company is Growing Rapidly Your developers are stretched thin.
Thankfully, there is all kinds of open source code available to help them work faster
Marketing is on a tear, pushing out YouTube videos and various multimedia campaigns.
You’ve found a great new image to promote your product.
© 2011 Cognition LLP
Copyright
Copyright is a form of protection allowing the owner of the rights in a work to prevent others from copying, displaying or performing the work.
The work must be original. Absent a contractual arrangement, the author
owns the copyright (an employer is deemed the author of any work created by an employee)
Registration is not necessary, but can be helpful. Use of copyright notice not necessary but helpful:
(C) [Year of first publication] [Owner]
© 2011 Cognition LLP
Copyright
Copyright doesn’t protect the idea, but the expression of the idea.
Open source software is still subject to copyright and must be licensed
Any music and images used for promotional purposes is likely subject to copyright and must be licensed.
Century 21 Canada Limited Partnership v. Rogers Communications Inc. – Zoocasa found liable for scraping content from Century 21 website and reproducing it
Thank you.www.cognitionllp.com
Rubsun [email protected], ext. 102 rubsunho @rubsun