Intellectual property protection

Intellectual property protection
The first thing you should do if you think you have a good idea: check that it's actually a new one.
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I am the law

What has been will be again, what has been done will be done again; there is nothing new under the sun
–Ecclesiastes 1:9-14 NIV

It’s an odd quotation to open any chapter on business innovation. But one of the best approaches to intellectual property protection is to believe this statement with religious intensity. Because the best way to waste a lot of time and money on an idea is to believe you have something new when you don’t. And you probably don’t.

That’s the sort of wake-up and shape-up call you get from running your ideas past specialist intellectual property lawyers like Hudson Gavin Martin. It can save you wasting a ton of cash developing a bad idea or spending the worst years of your life fighting with someone else’s IP lawyers.

Here’s the first thing someone should do if they think they have a good idea, says HGM partner Wayne Hudson: “Check that it is really new. People are spending way too much money on the protection without spending on researching whether they actually have something to protect.”

Magazine Layout “People are spending way too much money on the protection without spending on researching whether they actually have something to protect”

Wayne Hudson

partner, Hudson Gavin Martin

What this comes down to most of the time is checking to see how old your ‘new’ idea is and if anybody else is really using it in any country you want to trade in.

Checking the coast is clear

If you are serious about being a business operating on the bleeding edge, you need a quality professional specialist in IP protection. They will set the attack dogs on your thinking, specifically by attempting to establish whether the ideas you come up with have already been commercially exploited.

You should not do this yourself beyond the very early stages. It is all too easy to overlook things and all too hard to overcome your vested interest in your own ideas in order to make a proper assessment of how innovative they may or may not be.

Your IP person will do a ‘landscape search’, covering any existing patents and trade marks, scour trade journals and scientific literature, root through Google and more. What they are looking for is prior art: any material in the public domain that shows someone else has published this idea, or anything like it, before.

Defining intellectual property
• Copyright, trademarks and patents—these are defined by law and your ability to enforce them

• Know-how—what you know that other people don’t

• Confidential information—how you make sure other people don’t take your know-how

• Good will—people who believe in you, who have resources that can help your business. Whatever you have in your product line that is unique. Early on in the creation of an idea, this may be all you have. Later, this is what you plug into the manufacturing and distribution system you create to get your idea into the market. And as Bill Gates pointed out, “Intellectual property has the shelf life of a banana,” so you had better move fast.

They will also think laterally. What if somebody used similar technology or thinking in a completely different industry, to solve a completely different problem? This process helps you establish whether you are trying to eat someone else’s lunch, and how much effort they will put into defending it. It can also be an invaluable way of discovering applications for your idea that you may not have thought of otherwise.

Forgive us our trespasses

Reinventing the wheel
It’s worth remembering that some ideas may already be out there, but only become commercially viable when the technology or economics are right. For example, back in 1985 Sir Clive Sinclair launched the Sinclair C5 electric tricycle to popular ridicule and commercial disaster. In 1992, he hit back with the folding electric Zike Bike, which sold even less than the C5, and is soon to launch the X-1. Now here in New Zealand we have the Yike Bike, a three-wheel electric folding tricycle and, well … we’ll have to wait and see.

In the meantime Honda, representing the big boys, has also just created its U3-X Personal Mobility Prototype that is essentially a moving electric barstool that you stow in your car door.

In a future where everyone in the industrialised world can’t afford petrol and is too obese or lazy to walk anywhere, things like this may sell like the hot cakes that helped incapacitate us in the first place. Or they might not. Magazine Layout

Let’s assume you find some evidence that, shock horror, somebody, somewhere, sometime, miraculously thought of something similar to ‘your’ idea. And, taking into account that patents are country-specific, you believe their patent may be active and valid in a country where you want to do business.

There is encouraging news from fellow HGM partner Jason Rudkin- Binks. “Just because something isn’t novel doesn’t mean you can’t make money out of it,” he says.

A popular next step among high rollers with plenty of lawyer-lolly knocking around is to use these same research techniques to challenge the blocking patent in the courts, essentially by trying to prove that somebody else got there before the patent holder.

HGM partner Simon Martin puts it this way: “The only way to protect intellectual property is to enforce your rights. The ability to do that comes down to how well you are funded.”

Rudkin-Binks agrees. “The real big movers have massive spend on IP protection. They will use a sledgehammer to crack a nut.”

Of course, if your entire proposition is based on a specific technical fix, then you need to protect this in order to sell it. This is why, for example, Apple has teams of lawyers ready to slap a perfectly crafted writ on anybody infringing its rights to the particular finger-scrolling system is has on its computers.

But if you don’t have something unique it can often be cheaper and easier to be businesslike, to put your pride back in its box where it belongs, and try to do a deal. If the other party isn’t actually trading with the idea this may be as simple as making them an offer—just like when someone owns but isn’t using a internet domain name you want.

Even if somebody is trading on an idea and making money, you could try to buy a licence from them for it. This may cover a particular process you want to use, or a particular market. If they agree it’s possible for everybody to win, you get to go to work and they get money for their idea without having to. This is the way a lot of very big companies do a lot of very big business.

Alternatively, if you think there is money to be made, you can ignore the opposition and hope you generate enough money and market presence to fight it out or do a better deal with them later. This is also a popular tactic employed by some big players, especially those who see no particular reason to play nice.

“There are lots of ways to protect IP,” says Jonathan Kirkpatrick, CEO of AUT’s Business Innovation Centre, “but sometimes you just don’t bother. You just go to market. One of the reasons we spend so much time on it is because investors want to see it.”

If someone is trading on an idea similar to yours and doesn’t appear to be making money from it, it may simply be a bad idea. It is also worth remembering that big companies can afford to spend millions on some pretty wacky concepts in order to develop new technologies and test potential new markets.

If you get past all these hurdles and still reckon its worth a trip to the patent office, timing your visit may be very important. Ironically, the public disclosure to secure a patent might be what gives the game away if you file it before you are ready to take advantage of your chosen market.

The life cycle of an idea
When not peddling IP advice, Wayne Hudson of IP law firm Hudson Gavin Martin is often pedalling his bicycle. So I am not surprised when he illustrates the IP -checking process with a couple of examples from the world of two wheels:

“I had an idea about putting an indicator light on my gloves for when I was cycling.”
It sounds great to me. It’s one of those ‘why hasn’t anybody thought of it before?’ ideas.
“I checked and found an existing patent for that from 2008.”
Oh. Somebody had thought of it before.
“Then another one going back to 1915.”
A long time before.
“With about 30 other similar patents between those dates.”
Game over, then?
“Because of all those expired patents, you can pretty much discount any patents granted in the past 20 years, because they should never have been granted in the first place.”
Ah ha! So you are on! Being an IP lawyer you can exploit this forgotten ground!
“But you have to ask yourself, why don’t we then see this idea all over our roads? Because it is not a very good idea. The lights from a car will obscure your light. What you need is a reflective strip, costing about $4, not a light system costing $24.”
Apart from the obvious one of not making any money, another definite sign of a bad idea is that nobody is trying to copy it.

“The important thing is the result, not the process that gets you there,” says Hudson. “So there is a risk that people will see your patent and use it to find a different way to get the same result. For example, I had a client that had created a unique product. The process by which it was made was not evident just by looking at the product itself, but in lodging a patent it had to be disclosed, so other businesses could take a look at the patent, see how it was done, and change it sufficiently and get round the patent.”

Kirkpatrick is a touch more scathing. “Some entrepreneurs don’t understand the nature of competition. Your competitor is the person who is chasing the same dollar. It is not about how similar your product is. A horse and a car are very different but if the customer is using them for the same thing, they are in competition. There’s no point saying, ‘But mine has four wheels and theirs has four legs.’ The customer doesn’t care.”

In the intellectual property battle of wits, you need to have your strategy ready, and the team to implement it, because you can bet the opposition will.