IPR protection is crucial to the enterprise’s development. Building a sound IPR system can protect an enterprise’s technological achievements from the R&D stage, prevent IPR legal risks and give full play to the commercial value of technology, thereby improving the market competitiveness. This article will answer the question of “how to build an IP system for enterprises” from three aspects: IPR compliance, risk assessment and dispute resolution.
- Intellectual Property Right Compliance System
The IPR compliance system aims to make all things related to IPRs in business comply with the laws and regulations, so as to prevent IPR legal risks and improve IPR utilization. According to the process of technology development to implementation, the IPR compliance system can be subdivided into R&D legal compliance system, achievement management system, trade secret risk control and management system, early warning system and rights safeguard system. Depending on the different business sectors, IPR compliance needs to be carried out from various aspects such as corporate regulations and principles, specific projects, workflow & guidelines, and ledger management.
Enterprise needs to consider IPR protection issue from the R&D stage. The most important thing at this stage is to apply for patents, trademarks and other IPR protection as early as possible to avoid being infringed. “The IPRs highland, if I don’t occupy it, others will.” The consequence of being occupied by others is that the enterprise may lose its market advantage, and even its own products will become infringing products and be restricted from use. On the other hand, early application to occupy the highland will become an advantage in deterring the infringement allegations and seizing business opportunities. IP laws also show the significance of timing in many aspects, such as the priority principle in patent law, the first-to-file principle in trademark law and the confidentiality measures system in trade secrets. The law protects the know-how that has priority of application and use.
2. Intellectual Property Risk Assessment
Applying for IPR as soon as possible is only small part of the IPR protection in the business, which is not enough. IP legal risks exist at all stages of a project and in all aspects of an enterprise’s business. Therefore, enterprises need to accurately identify and assess the risks in order to avoid losses to the greatest extent.
At the technology development stage, enterprises need to conduct a detailed and thorough IPR background investigation. For example, it is necessary to know the patent situation and legal status of the industry : if the technology has already been developed; if it may use the existing IPRs of others; and if some areas of technology are often subject to infringement lawsuits. There are many ways to do this, such as checking patent and trademark registrations on official websites, learning the latest developments and trends through industry reports, or entrusting the professionals to conduct surveys. Only by fully understanding the industry situation can enterprises avoid risks and save costs.
Enterprises should assess the risks identified during the R&D and implementation stages to make scientific decisions. Before launching and developing of a technology, if the patent pre-search reveals that other companies are developing or have already done the relevant technology, the company will need to decide whether to continue the development or not based on the level of exploitation and commercial value of the technology.
During the development, various tangible and intangible documentary vehicles are generated. For example, design drawings, plans, software programs, etc. On the one hand, enterprises should protect the documents, which contain important technical information and trade secrets, from theft. On the other hand, it should be wary of conscious or unconscious leakage by staff. When releasing technical information and important documents, and even when designing marketing promotional materials, companies should be cautious to check the content to avoid revealing too much technical information that can be used by competitors and thus lose their competitive edge.
Recruitment and staff training is also an important aspect of preventing IP risks. Before recruitment, companies should do a proper IP background check, for example, whether the person has ever committed any IP infringement. After the employees have joined the company, they should be trained to protect IPRs and trade secrets in work and informed to avoid infringing on the others’ IPRs.
Companies need to take appropriate risk response measures to prevent and cope with the risks. Firstly, the company has to develop a plan to deal with the risk before it arises. Because time is tight after a risk has arisen, sometimes managers are unable to come up with prefect solutions quickly. Secondly, enterprises should design compliance evaluation and accountability mechanisms to assess the compliance levels of various work; develop perfect accountability mechanisms and reward & punishment standards to ensure that there are rules to follow and responsibilities to pursue when risks arise. Finally, in the process of business cooperation and results application, attention should be paid to the formulation and signing of contracts, such as the formulating exemption clauses and liability sharing clauses, so as to avoid taking unnecessary risks and adverse consequences caused by partners or third parties.
3. Intellectual Property Litigation Strategy
Having a comprehensive risk identification, assessment and response compliance systems in the early and mid stages can avoid IP risks as far as possible. However, there is always the possibility of commercial conflicts or IPR disputes during the companies development, even for well-known and large enterprises. This requires companies to have a scientific and effective dispute resolution strategy.
Holistic assessment.
Firstly, after a dispute has arisen, companies need to make a throughout assessment of it. For example, the reason for the dispute, whether it is companies’ own responsibility, where the key points of the dispute are, and the possible impact of the dispute on the business, including but not limited to actual economic loss and brand influence.
Negotiation and settlement.
Secondly, negotiation and settlement are the preferred options for dispute resolution as litigation is more costly in terms of time, money and manpower. It is the most efficient method if it can be resolved through amicable negotiation. To achieve this, both parties to the conflict may need to make certain compromise, like giving a certain amount of compensation to salvage the bigger picture through smaller losses.
Referral to professionals.
When a dispute is irreconcilable and must be resolved by litigation or arbitration. The company then needs to refer it to a legal professional. Even if the company has a legal department, which may lack practical experience in litigation, so it is recommended to work with a specialist law firm or team to win the case.
