Strategic IP Management

Written by
Maiken Toftgaard
from
Poul Schmith Kammeradvokaten
-
September 30, 2022

A BRIEF GUIDE

WHAT AND WHY

Securing a successful IP strategy is in many ways similar to a business plan. Establishing a solid IP strategy is essential in order to ensure that your company has all relevant IP rights, including copyrights, patents, trademarks, domain names etc. It will ensure that your company is able withstand investor due diligence, successful differentiation from competitors and proper accreditation in ventures with others.

The purpose of implementing an IP strategy is – in other words - to ensure, that your company sufficiently protects and enforces important IP rights and avoids infringing on the rights of others.

VALUE BEYOND COST AND INVESTMENT

In many ways, the intangible assets owned or licensed by a company holds value comparative to that of the company’s more tangible assets. Your company’s IP rights thus holds important value beyond the costs of designing a logo, deciding on a name, choosing the look for a product and/or inventing a solution to technical challenges.

Your IP rights can:

  • Function as an insurance in terms of being free to use the IP in question while simultaneously barring others from using or infringing on any such rights illegitimately.
  • Be fundamental to securing seed money or fundraising and securing the value of your business in mergers or sales.
  • Ensure that your company is able to withstand investor due diligence, successful differentiation from competitors and proper accreditation in ventures with others.

THE FIVE PILLARS OF STRATEGIC IP MANAGEMENT

Knowing where to start might be difficult. However, breaking down what may seem like a large and indefinable task into five different pillars might just help you structure the work ahead and provide you with the necessary tools moving forward:

1. IP STRATEGY

2. PORTFOLIO

3. USE AND DOCUMENTATION

4. SURVEILLANCE AND ENFORCEMENT

5. MONETIZATION

PILLAR 1 - A SOUND IP STRATEGY

First step is to establish a sound IP strategy. There are generally two types of IP strategies:

  • Offensive strategy: The main goal is to protect your IP assets and to acquire external IP rights, when and where possible.
  • Defensive strategy: The main objective is to eliminate or reduce risks by preventing competitors from exploiting your company’s creations.

When drawing up your IP strategy, it is essential that you actively consider an action plan and assign roles within your organization. This is both to secure a consistent overview of assets, but also to make sure it is clearly defined which IP is to be secured, as well as how and where in your organization it is used, enforced and commercialized.

PILLAR 2 - PORTFOLIO MANAGEMENT

You also need to manage your company’s portfolio, which includes a set of actions directed towards gathering as much information as possible about your company’s IP and securing that your IP is maintained and protected for years to come.

image

First of all, you need to do an inventory of all the IPR you currently have as well as the IPR you need in order to realize your business plan. The inventory is not just for the sake of having a spiffy list of your IP, you can show potential investors. The inventory is just as essential in the maintenance of your registered IP, such as trademarks and design rights – making sure you never miss a deadline.

PILLAR 3 - DOCUMENTATION AND USE

Some IP rights requires use and documentation of use in order to maintain the rights.

Proof of genuine use

Especially when it comes to trademark maintenance, it is important, that you are able to document genuine use of your trademarks in order to defend your marks, if your rights are challenged. We recommend, that you create an archive of “proof of use” material. As a best practice, the archive should be updated (at least) yearly.

If your trademark is challenged, the archive should allow you to prove use of the mark in the relevant country for each relevant product or service, for as long back as possible. Doing the work in advance, will potentially save you a lot of time and expenses compared to having to dig out the relevant information after the rights are challenged.

The following may (typically) serve as proof of use:

  • Photographs that show the mark on a tag or label affixed to the goods
  • Screenshots of webpages with the URL and access or print date that show the mark being used in connection with the goods at their point of sale
  • Copies of brochures or flyers where the mark is used in advertising the goods or services
  • Invoices documenting sale of the goods or services (clearly showing the mark)

Freedom-to-Operate Analysis (FTO)

Before venturing into new markets or launching a new product or service, it is vital that you protect the IP at the core of your company. However, it is just as vital, that you make sure you are not hindered by the rights of others or unintentionally violate any such rights when doing so.

This is why many companies, prior to the launch of a product, seek to ensure that the commercial production, marketing and/or use of their new product, process, trademark or service does not infringe the IP rights of others by carrying out an FTO. FTOs should be performed by professionals since they involve an exhaustive review of i.e., literature and databases, assessing factors such as the likelihood of confusion.

PILLAR 4 - SURVEILLANCE AND ENFORCEMENT

Knowing what your competition is up to is always a good idea – but when it comes to the protection and maintenance of your IP, it can be the difference between success and failure.

Most trademark offices do not assess whether submitted applications come too close to existing rights, and will not alert you, if someone else is attempting to register a mark that is identical to yours. The value of your trademark portfolio will therefore be directly dependent on your surveillance and enforcement efforts.

Surveillance and enforcement is not only important to trademarks but may be essential in connection with a host of different IP rights – from copyright or design to patents or domain names - and depend on whether you are dealing with goods or services.

It is beyond the scope of this short guide to set out all the ways in which you may surveil or enforce the different kinds of IP owned by your company, but generally it is recommended, that you:

  • Ask your IP professional to watch your registered trademarks or monitor online infringements
  • React as soon as you become aware of counterfeit products, trademark violations and other forms of violations.

PILLAR 5 - MONETIZATION // COMMERCIALIZATION

Having a good idea is key, but it is not enough to succeed. You must also know how to exploit it in a smart, profitable and sustainable way.

There are many different types of business models you may choose between when commercializing on your IP, including:

  • JOINT VENTURE
  • LICENSING
  • FRANCHISING

Confidentiality / Non-disclosure

Before entering into a partnership, you should always remember to clearly define and agree with your partner(s) on how to handle any potential (future) IP that may be created in the course of the cooperation (e.g., by dividing IP ownership and/or establishing licence agreements.)

As a general rule, you can either decide:

  • That the IP rights brought into a partnership will remain in the hands of its original owner, or
  • to transfer ownership over said rights to an entity created solely for the purpose of the collaboration.

When reaching out to potential business partners or investors, it is highly advised that you enter into a non- disclosure agreement (NDA) to avoid any future problems or misunderstandings once the honeymoon-phase of the collaboration is over.

An NDA should – as a minimum – include

  • Clear identification of the parties
  • Definition of what is confidential
  • The receiving party’s permitted uses
  • Limit on the counterpart’s possibilities of disclosure
  • Duration of the agreement