Thought Leadership on Intellectual Property Protection presented by Nath, Goldberg & Meyer.
By Joshua B. Goldberg
Previously, I have discussed several different issues based on knowing when and how to protect your intellectual property, whether you are a technology company or not. One question I have left unaddressed, for now, is where you should protect your intellectual property. As before, there is no one-size-fits-all answer to this question, but instead the answer will depend on your specific business, your markets and your goals. Hopefully my thoughts and comments will aid you in creating the most value for your business moving forward.
Meeting your business strategy
One of the first things necessary is to align your business goals and strategy with your geographic scope of protection. For example, where are you conducting your business? In the U.S. only, in certain smaller geographic areas around the world, or worldwide? And is the answer to this question likely to change in five to 10 years? Clearly, if the sole focus of your company is in the U.S., there should be no reason to protect your IP around the world.
Then again, how sure are you your sole focus is in the U.S.? Do you have any manufacturing activities elsewhere around the world? Additional offices? Expansion plans? Contacts? As the world continues to get smaller and the internet brings us all closer together, it is important to think these issues through so that a mistake today does not have serious repercussions for your business tomorrow. For example, suppose your efforts today are U.S.-focused, but as you go looking for strategic partners, you find you are drawing significant interest from European companies. Do you have a plan in place to make them feel like they would be protected in their home markets? Or, what markets are important for your products? Where are your profits most likely to be made? And, of course, you will want to select those countries that have strong IP laws generally, so that your IP portfolio, once acquired, can be enforced.
The flip side to that, of course, is the cost. All IP rights are geographical in nature, meaning they are only enforceable in the countries where they are filed and protected. Each individual country will have its own system in place for protecting your IP, as well as its own official fees to be paid. It is very easy to turn a simple project of protecting your brand in the U.S. into a worldwide protection odyssey, along with an accompanying out-of-control spiral of ever increasing fees to be paid. Therefore, it is important to not only know where you are, but also to know where you are going so you end up in the right place.
One good place to start is to conduct an internal IP audit. This refers to a complete review of all your company’s activities to see what patentable inventions you might be using, what trademarks you might have that have not been protected to date, whether you have any copyrightable text or software in use, whether there is any secret information that gives your business an extra advantage, etc. We have conducted such full audits for our clients on many occasions, resulting in lists of far more protectable assets than our clients ever thought possible. Until you know the full scope of what it is you can protect, it is difficult to know where you should be protecting it.
What are others doing?
Another source of useful information is to see what practices other companies in your industry use. For example, are all your competitors focused only in the U.S., or have some of them started to expand their operations, IP activities, manufacturing, etc. elsewhere? While it might not be to your advantage to be the first to expand to a new territory, it likely is not to your advantage to be the last to conduct such an expansion in your industry, either.
This important information can be gained through numerous sources, whether it be by speaking with your competitors directly, conducting competitive surveillance to see where they are filing for protection of their patents, their trademarks, etc., attending and paying attention at relevant trade shows, or using various fee-based search tools, this sort of information can greatly enhance your ability to focus limited company resources in those geographic areas that are of the most importance.
Now that I know where I am going, how do I get there?
There are many available options for enacting a comprehensive world-wide intellectual property protection strategy. One of the primary considerations is whether the protection is needed in the short vs. the long term. If you are concerned about imminent competitive activity, you will naturally be more interested in establishing your rights now, rather than going through some delay to save costs. This can be done by directly filing your trademark or patent applications in each country or geographic area of great importance as soon as possible, to get the process started and to enjoy your rights as soon as possible.
If, instead, you have more time available to you, there are several tactics you can employ to delay incurring various expenses until you have a better idea that protection in each geographic are of interest is necessary/optimal. For example, if you are focused on patenting your innovations, you can file what is called a Patent Cooperation Treaty, or PCT, application, which gives you a total of 30 months to decide in what countries you want to attempt to obtain your patent. Similar regimes exist for trademarks as well.
In making some of these decisions, it is important to remember how long the whole process takes. For example, for patent applications that are filed using the PCT process, it is often 2-5 years from the date of your first filing to the date you obtain your first patent. You should add another two years, for any international patent applications you file to turn into granted patents. So, it is important to have a roadmap in mind early, so that you do not delay making some of these important decisions until the decision is taken out of your hands.
Typically, the best strategy is to select the most important 3 to 8 countries for your product, and do what you can to obtain protection in those markets. Very often, 90-95% of a product’s revenue will come from these handful of countries. Seeking to obtain a patent beyond this small list of countries is likely to be, at best, a waste of critical resources, funds, and time.
We have helped numerous companies, startups, and individuals successfully navigate this process, and stand ready to help guide you as well. Please feel free to contact me to discuss any aspect of the patent process in more detail.