New post regarding IP law and practice by Christopher Heer & Annette Latoszewska, based on IP law in Ontario, Canada and general IP and business principles.
With businesses competing on a global scale, the value of intellectual property, now more than ever, cannot be overstated. Intellectual property rights can help businesses thrive in global markets by securing their strategic investments in innovation and marketing, and enabling them to develop, protect, and capitalize on an international reputation. For these reasons, protecting intellectual property from infringement should be a top priority for any business.
Patents
With consumers today having access to a massive global marketplace, competition for sales in virtually all markets is at an unprecedented level. U.S. businesses, for example, are no longer competing exclusively among themselves but are forced to lure consumers away from competitors halfway around the world. What’s worse, these competitors often have the capacity to manufacture, distribute and sell substantially the same products at a much lower cost. Innovation, therefore, is critical, to success in this global marketplace.
Intellectual property rights, namely, patents, permit businesses to confidently invest in innovation with the goal of bringing to market a new product not offered by their competitors. A patent grants its owner time-limited, monopoly rights over a new, inventive, and useful invention so that, once it hits the market, competitors cannot immediately copy and sell it, thereby diverting from the patent owner’s sales.
It is important to note that intellectual property rights are territorial in scope, meaning that a company seeking protection of an invention in a number of countries in which it does business must apply for a patent in each of those countries. The Patent Cooperation Treaty, however, supports a multi-national commercialization approach by extending patent filing deadlines through the submission of a single patent application. Further, although a Canadian patent will only protect the invention in Canada, that protection does prohibit the importation of infringing products. Therefore, for example, while a company in Singapore may not be liable for making the patented invention in Singapore (subject to it being patented in that country), an importer will be liable to the Canadian patent owner if it then imports that invention for sale in Canada.
Trademarks
With so many competitors, a distinctive, protected brand is more important than ever – this is where trademarks come in. With a registered and distinctive trademark displayed prominently on its products, a business can build a valuable reputation for the sale of quality goods that will not only keep the same customers coming back, but likely attract new customers which have become aware of that reputation. In other words, a strong, legally protectable trademark is a key ingredient to building and maintaining brand loyalty.
A significant reputation in the market, however, can be a double-edged sword. Competitors may consider appropriating your brand and exploiting your success by marking their own look-a-like products to attract additional sales. A registered trademark, however, can help prevent against unauthorized use of your branding. Registering your trademark ensures that your business is able to make profitable investments into building its reputation on a global scale, without fear of competitors piggybacking on the reputation you’ve built. A registered trademark gives the owner the exclusive right to the use of the trademark throughout a given jurisdiction in respect of the goods or services with which it is associated at the time of registration. For example, Coca-Cola Ltd., by virtue of its Canadian trademark registration, is the owner of the exclusive right to use COCA-COLA® in association with a wide variety of goods and services in Canada, including, most notably, carbonated soft drinks.
Copyright
Another way in which intellectual property is relevant to competition in global markets is through marketing. Although trademarks may have a more obvious role, a company’s marketing efforts may also be protectable under the branch of intellectual property laws referred to as copyright.
Copyright protects original, creative works – think posters, video advertisements, even website design. The owner of copyright in a work has the exclusive right to produce, reproduce, perform or publish that work. What this may mean for a business is that its super successful marketing campaign, which has doubled monthly sales, cannot be knocked off by a competitor, such as by reproducing a video demonstration of the benefits of a cast iron pan, produced by your business, to boost its own sales.
One unique feature of copyright is that it provides automatic protection. An original creative work is protected by copyright from the time it is authored and put in a fixed form. Although registration is possible, and has several benefits, it is not required for a work to be protected. Further, the Berne Convention has the effect of guaranteeing a minimum level of copyright protection for a work created in any one of 179 member countries. Although this guarantee of multinational protection is valuable, it is important to keep in mind that the precise nature and term of copyright protection in these countries, beyond the minimum level required by the convention, varies, and there are still many reasons to consider formal registration of copyright.
Conclusion
In summary, intellectual property rights can ensure that the everyday investments made by a business to render it competitive in a market do not go to waste. By proactively protecting their inventions, brands, and promotional materials, businesses can set themselves up to independently reap the rewards of their investments.
Christopher Heer and Annette Latoszewska
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