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Protecting your idea

The dog ate my intellectual property protection. If you find yourself snapping a self-portrait while holding up some sketchy diagrams and today’s paper or posting notes to yourself by registered mail in an effort to prove that your original inspirational ideas are indeed yours, you need help.

The dog ate my intellectual property protection. If you find yourself snapping a self-portrait while holding up some sketchy diagrams and today’s paper or posting notes to yourself by registered mail in an effort to prove that your original inspirational ideas are indeed yours, you need help.

Intellectual property protection is not about keeping your ‘secret formula’ under wraps. If you’re worried about telling people anything about your idea in case they steal it, you don’t have enough of an idea. Simon Martin, partner at specialist intellectual property and technology lawyers Hudson Gavin Martin, makes his living from protecting IP—and strikes a realistic note. “An idea in itself can’t be protected. If it’s successful, it will be copied.”

Your intellectual property might be a product or a process. It might just end up being the brand name written on your widget. So when it comes to intellectual property, the truth is most people do need help. Not just to protect what you have, but to identify what you have in the first place.

Martin’s business partner Wayne Hudson says: “The basic principles of intellectual property protection are only the tip of the iceberg. Many people try to undertake all of the early groundwork themselves, but often they are simply too closely involved to see things objectively. It isn’t unknown for businesses to take something innovative and complete the whole commercialisation process only to discover—most often too late—that they don’t own what they have produced, or even know what opportunities they have missed out on. For example, people often focus on one industry. They don’t realise their application can be better used in others.”

You are your paperwork

To a large extent, reviewing and protecting intellectual property is a necessary extension of the innovation process. The clarity you gain at this point on what you really own, what it can be used for and what can be protected, impacts directly on your ability to commercialise it.

HGM associate Jason Rudkin- Binks explains: “If somebody wants to invest in you, it’s just a shake of the hand if you don’t have the paperwork. In this sense, the commercialisation documents define your intellectual property. By analogy, you wouldn’t expect to sell your house without the purchaser seeing detailed plans showing the size, boundaries and, for instance, rights of way, over that land. Why should intellectual property be any different?”

Like all the people you are looking to get advice and services from along the road to commercial success, your IP lawyer should be part of your racing team. They work on deal after deal, so as well as locking down the legal nuts and bolts they get a sense of what the market is doing, what is normal (and what isn’t!) and what rights each party can reasonably expect to buy and sell.

An idea in itself can’t be protected. If it’s successful, it will be copied

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—Simon Martin

They are not an emergency ambulance service or a pit crew you pull into when you are losing control of the thing, racing along on your own. They should be right there in the car with you, calling out pace notes. Their ability to do this sets them apart from the guy who did your last house purchase. Intellectual property is an area renowned for complexity, especially when multiple jurisdictions are involved.

HGM has a few horror stories to underline the value of its kind of specialist help and why it’s wrong to treat intellectual property like any other asset that can be bought and sold. For instance, licences and assignments are fundamentally different tools and while in practice they can be very similar, you wouldn’t want to get it wrong. A real-life example of such confusion has been known to occur in terms of software; this is something you would normally licence (i.e. lend), but when assigned (i.e. given away) it changes the deal entirely. The scope of agreements are also crucial: would you want to be the entrepreneur who sold the rights to commercialise in Australia and then watched in shock as the purchaser started exporting to Europe and the US? It turned out he had in error sold the rights in those key markets as well.

If you are going to need other partners, this is where things can get complex. For example, if you have come up with an invention in conjunction with someone else, you will jointly own it. If you then set up a company to commercialise the invention, you need to be clear as to whether you will both transfer the IP in the invention into the company or jointly license that IP to the company.

Overlooked details that seem small now will grow with your business and become big problems later.

Innovation as a contact sport

It’s all about preventing future problems, so you can get on with running your shiny new business. There is no law that says you have to get a lawyer involved, but if it becomes a huge success then don’t be surprised if things get complicated and you find yourself searching your filing cabinet for ownership documents.

If there is a disagreement, how far the fight goes depends largely on how much the idea is now worth—or how much money the rival parties are prepared to invest in heavy legal weaponry. But even if there’s millions swilling around, one party usually ends up paying the other to go away, and the lords and ladies in the wigs don’t get a look in.

It isn’t unknown for businesses to take something innovative only to discover— most often too late—they don’t own what they have produced, or even know what opportunities they missed out on

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—Wayne Hudson

Here’s a scenario: you have an idea, you pay a lawyer to work out what your IP is, you make a decision to proceed and then you find someone else has a patent. That’s not surprising—there aren’t many new ideas under the sun. What have you achieved? Hudson says: “Freedom to Operate searches nearly always come up with problems.”

There’s a balance to be struck here; you can’t be scared off just because someone is sitting on a similar patent, particularly if they are not doing with it what you want to do with it. But you want to know, so you can work out whether you can afford to ignore them for while or even explore opportunities to work together. The reverse is also possible.

You might know others are trampling all over your IP, but you make a judgement call that it’s more effective to focus on becoming the ‘best in breed’, and surfing the wave you have just created. This can be especially effective if your innovation is opening up a new sector—you may need others to market other similar or connected products in order to raise enough noise to get things rolling.

You can also decide to leave some geographical areas to the sharks, if you want to focus elsewhere. Cut a deal with a distributor for Asia, but firewall Europe and the US for yourself. And once you find yourself surrounded by other people’s clones of your idea, it’s surely time to come up with the next brainwave.

Early-stage IP protection to-do list

From Hudson Gavin Martin

  1. Novelty search.
    Too many inventors think they have conjured something out of nothing, only to spend thousands of dollars finding out that they are not quite the magician they first thought.
  2. Patent search.
    Conduct a Freedom to Operate search. Ideally, get a decent patent attorney to look for patents that have been registered worldwide. There are a number of freely available online tools, including Google Patents, Free Patents Online and Espace. But if you DIY it, remember to keep looking hard for what you don’t want to find: someone else with a similar idea.
  3. Prior art search.
    A lot of inventions have no patent—but they can still invalidate your patent. And many inventors are happy to share their inventions with the rest of the world on websites like YouTube, so you need to use all the search tools you can and keep turning over the rocks.
  4. Public domain.
    If a similar invention is already in the public domain (nobody else has asserted any intellectual property rights) or has been tried before and failed, ask yourself whether you really want to chow down on somebody’s leftovers. Can you make a new meal?
  5. Strengths, Weaknesses, Opportunities and Threats.
    It’s a cliché, but do your SWOT analysis properly anyway.
  6. Identify potential partners.
    Finding something similar does not necessarily mean game over. Could you join their game if you bring your own ball? Consider licensing or joint ventures.
  7. Collaborate.
    Too many inventors keep their inventions to themselves. If the number of GPS solution providers in New Zealand is an indication (there are reportedly more than 30), too many of us are scrabbling for the same dollars.