Protect Intellectual Property Before You Start-up

Entrepreneurs must understand the different types of intellectual property and how to protect each type. Entrepreneurs should then take action to protect their intellectual property as soon as possible – before launch is best.

Protectable intellectual property includes patents, trademarks, copyrights, and trade secrets.  Each of these categories protects a different aspect of your ideas. In this article, I will only discuss how to protect your intellectual property in the United States.  The laws and schemes of other jurisdictions will vary.

Patents protect useful inventions that solve a specific technological problem. In return for disclosing your solution to that problem (the solution may be a product or a process), you are granted exclusive rights to exploit the invention for a period.  After the patent expires, anyone can use the invention.

Trademarks protect the brand names, logos, and slogans you use to sell your product. A trademark grants you the exclusive use of the name, logo or slogan you use, and permits you to stop anyone else from using a name, logo or slogan that is confusingly similar.

Copyrights protect your original artistic or literary works. Like patents, the copyright gives the author certain exclusive rights to use or exploit the copyrighted work for a period.

Trade Secrets are business information, processes, practices, formulas and the like that a business owner has chosen not to patent and that the business owner seeks to protect by limiting access to them.  Trade Secrets are secret as long as you can protect them.  Business owners use laws like the Uniform Trade Secrets Act (in most US States) to help them protect their trade secrets.

Entrepreneurs should take the time – up front – to determine what intellectual property they have and to protect that intellectual property.

For inventors, patent registration is imperative. Not only must your invention be novel and useful, but also you cannot patent an invention once it has been publicly disclosed.  Therefore, patenting your product or process is not something that can be put off until later. You apply to register your patent at the United States Patent and Trademark Office. Before you register, you or your patent attorney must conduct a thorough patent search. You may also need professional drawings and detailed specifications.  Patents are by far the most complex of the intellectual property schemes, and there are many options, including provisional patents, utility patents, design patents and plant patents.  Unless you have considerable patent experience, you should get a patent attorney to help you with this process.

Trademark registration should be thought of as a mandatory, basic expense for almost any small business.  You are going to be putting a great deal of time and money into growing your business’s name recognition in the marketplace. It always hurts when you have finally gotten some traction, and you get that nasty letter from some trademark attorney telling you to “cease and desist” infringing on their client’s trademark. At a minimum, you will be changing your name, possibly your logo, and losing all the traction you have gained in the marketplace. The fact that a state had allowed you to use a name when you formed your business does not give you a trademark.  The fact that you were able to buy the ‘.com’ of the name does not give you a trademark.  In either case, the trademark owner can come along later and make you change the name or give up the web address.  Trademarks are obtained by filing a trademark application online at the United States Patent and Trademark Office.  As with a patent, you or your attorney should conduct a thorough search first, and you may need a professional drawing if you’re trademarking a logo. You may be able to make it through trademark registration without an attorney, but an attorney who knows trademark procedure and has registered trademarks will be money well spent.

Copyrights are the easiest protection to do yourself. The forms are relatively simple, and if you are a person who can follow detailed instructions carefully, you can do it.  One registers a copyright at the United States Copyright Office – a department of the Library of Congress.  There are at least five different type of copyrights (literary, visual art, performing art, sound and serial). Sometimes, this can get a little confusing (a computer program is a ‘literary work’, for example), and a good copyright attorney can be useful.  This is especially the case because there are often sticky issues of ownership, rights, licensure, etc. that surround a copyright.  These issues create a fertile source of small business litigation – better get this right the first time.

A small business protects trade secrets by keeping the information confidential, by identifying what information you consider as secret (marking any document it appears in is a good way) and by including trade secret protection language in your employment agreements, your employee handbook, or your job offer letters, as the case may be.  Trade secret law is local – each US State is different – unlike patent, trademark and copyright law, which is federal and the same in each state.  Your business attorney should be familiar with your state’s particular trade secret law and how to best protect you.

Intellectual property gives your business value, and a well curated portfolio of intellectual property will impress potential buyers and make exit easier and more profitable.  Protecting your intellectual property will also enable you to get full value from your thoughts and ideas, realize the benefits of your marketing efforts, and protect your investment from dead ends like infringement.  The wise entrepreneur protects intellectual property up front, budgeted as a start-up cost, and does not put intellectual property protection off until later.


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