The term intellectual property was virtually unknown until the 1990s. Patents, copyrights and trademarks, as well as know-how and trade secrets, are often referred to collectively as intellectual property. The value of intellectual property lies in its ability to exclude competitors from utilizing intellectual property.
Corporations and individuals, the owners of IP, can have widely varying views of intellectual property. Some unrealistically believe that having a patent will guarantee success in the marketplace. They spend thousands of dollars to get the exclusive rights to exploit a technology or invention which no one values or can afford to buy. Others conclude that obtaining intellectual property protection is not worth the expense or effort involved.
Virtually all businesses have some intellectual property. In many cases businesses are unable to specifically identify their IP assets. They are also unaware of the need to take measures to protect and maintain this asset. It is ironic that they often go to elaborate security measures in order to safeguard tangible assets such as building, machinery, office furniture, computers, vehicles and cash, while ignoring the protection of their intangible intellectual property assets, which in some instances are more valuable than the tangible assets.
Patent, copyright and trademark legislation establish the process for businesses and individuals to obtain protection. The scope of this protection can vary widely from country to country. In addition, these laws are constantly changing. On the other hand, know-how and trade secrets are primarily protectable through a confidentiality duty or an agreement between and employer and employee.
It is clear that for corporations such as MicrosoftTM, intellectual property is the cornerstone on which the business is built. At the other end of the scale, a not so obvious example of intellectual property exists in a small lawn care business. Perhaps such a business has independently developed an effective annual lawn maintenance program to serve its customers. Say that program includes a process for controlling weeds and cultivating lawn growth. This business has in fact developed its own trade secrets which provide an advantage over other competitive businesses in this field. These trade secrets, combined with the knowledge of such aspects as marketing and billing, comprise the intellectual property of the lawn care business.
Through a patent, the government provides an inventor with the right to exclude others from making, using or selling your invention. In return for these exclusive rights, the inventor must provide a full description of the invention. This disclosure will be published 18 months after the application is filled so that the public can benefit from this advance in technology and knowledge. In the United States and Canada patent rights apply from the day that the patent is granted to a maximum of 20 years after the date on which the patent application was filed. Patents are granted for new, first in the world technologies which are functional and operative, and which demonstrate inventive ingenuity not obvious to someone trained in the field. Only an inventor, or the inventors assignee, may apply for a patent.
A trademark is a word, symbol, design or combination of these used to distinguish the wares or services of one person or organization from those of others in the marketplace. Trademarks come to represent not only the actual wares and services, but the reputation of the producer as well. They can help to capture the goodwill of a business and the brand loyalty of products and services. Trademarks are considered an element of intellectual property which can be protected through legal proceedings from misuse and imitation.
An industrial design is the shape, pattern or ornamentation which is applied to a mass-produced useful article. The design must have features intended for visual appeal, such as the shape of a chair or the ornamentation on the handle of a spoon. It may be produced by hand tool or machine. In Canada, protection lasts for 5 years, and is renewable for 5 years after that. In the United States 14 years of protection can be obtained.
Copyright means the right to copy. It applies to all original literary, dramatic, musical and artistic works. Only the owner of the copyright, (usually the creator of the piece), is allowed to produce or reproduce the work in question, or to permit anyone else to do so.
A trade secret may consist of any formula, process, device, pattern, or compilation of information, which is used in ones business, and which provides a business the opportunity to obtain an advantage over competitors who do not know and who dont have access to using the information. A trade secret cannot be patented, as patent means that disclosure is required. Trade secrets are known by a limited number of individuals on a need to know basis. Care must be taken by the holders of a trade secret to safeguard its existence and ownership. Unlike patents which expire, there is no limit to the life span of a trade secret. The most famous example of a trade secret is the formulation of Coca-ColaTM.
Know-how is the term with applies to a the ability to execute specific tasks or to produce specific products and services. Unlike trade secrets, know-how exists in the public domain and applies to transferable skills and knowledge which can legally move from one business to another when individuals move from one job to another. An example of know-how would be the ability of a company to produce a common product through effectively utilizing sophisticated yet readily available machinery.
Licensing is a discipline that involves the sale and delivery or transfer of technology from its owner, (the licensor), to a purchaser, the (licensee), in an agreed upon fashion, with agreed upon rights, for an agreed upon consideration. The technology may be in many different forms including: patents, products, machines, processes, registered or unregistered designs, know-how, business models, or trademarks and copyrights. Licensing is not restricted to "high technology" as know-how or business models can be licensed without an accompanying high technology component.
Technology transfer is process of the transmission of intellectual property rights, from the licensor to the licensee, either with or without the concurrent transfer of goods and services.