Written by: Rebecca Howlett – Commercial Lawyer Photography by: Freeths Solicitors
In this article commercial lawyer and IP expert, Rebecca Howlett of Freeths Solicitors, explains the importance of knowing your IP rights, how to protect them and how to exploit them. She also shares some of her top tips for getting it right.
Register your trademarks.
Just because you’ve registered your company name with Companies House or registered your domain, don’t assume this gives you protection over the name or the right to stop others from using it. You need to register your company name and/or brands as trademarks. This will show clear ownership and make it far easier for you to defend any infringement. Taking this step early on will prevent someone else from registering the name before you do and ensures you can use it and defend it. Failure to do so could result in a protracted and costly legal battle.
Keep your ideas under your hat.
The easiest way for someone to take advantage of your IP rights is to give them away unwittingly. It happens. Frequently. So don’t chat about your business venture to a friend in the pub, or give away secrets when talking to a business you want to partner with or a potential manufacturer. Once the information is shared, it can be very costly to secure your rights. If you want to save legal fees later down the line, make sure anyone you divulge your confidential information to is someone who has already signed a non-disclosure agreement.
“Always carry out comprehensive due diligence checks on any business or entity before you enter into discussions regarding your business or its IP. You need to ensure the business is legitimate, honest and able to deliver the results it say it can”
Don’t sign away your key rights.
Time and time again I am asked to look at an agreement that a client believes gives them full rights over their IP. However, a quick review of the documents shows it doesn’t and they have actually assigned their core IP to a third party. Always read the small print and, if in doubt, ask for legal advice. I know of a luxury skincare company that paid £3,000 for a logo design but they didn’t realise the designer retained the IP rights. They only discovered this when the company was up for sale and had to pay the designer £60,000 to assign the IP and enable the sale to go through. An expensive oversight.
Once protected, commercialise it.
If your business has secure IP, you can commercialise it and use your brand as a powerful tool. IP rights are a commodity like anything else, so why not license them to create additional revenue streams for your business? Review your IP assets and think through which ones are suitable for building licensing streams. Consider whether you want to branch into new markets and whether you want to use a distributor or an agent with local knowledge to help with this growth.
Know who you are dealing with.
Always carry out comprehensive due diligence checks on any business or entity before you enter into discussions regarding your business or its IP. You need to ensure the business is legitimate, honest and able to deliver the results they say they can. If you enter into a business relationship that goes wrong, it can be a hard battle to win back your rights.
Consider your exit.
Every decision you make for your business should be with an eye on the exit. The sale of your business may not be on the cards for a number of years, but if you build your business so it is desirable for a potential buyer then you can drive up its value. You need to ensure three things:
• Firstly that you have protected your IP;
• Secondly, the ownership of your business sits where it should; and
• Thirdly all contracts you have in place will survive a sale. Taking legal advice two to three years in advance of a sale can help increase your sale price and reduce the time it can take to sell your business.
Investing in your IP early on can save a great deal of money later – and once you have identified and protected it you can really make it work for you. Do the hard work up front and keep monitoring the position so you are not distracted by a threat to your brand. After all, if you have not done your homework, you may need to rebrand your business at short notice and this can have a significant impact upon your financial and time resources as well as your reputation, as the brand that people have already come to know suddenly disappears.
If you are not sure if your Intellectual Property Rights are secure or are about to partner with a third party, then call Rebecca Howlett, Commercial & IP Partner, on 01865 781 082 or by email at firstname.lastname@example.org, to make sure your rights don’t stray.