Anyone that owns a business today
should take a moment to check the
hidden assets of that business; namely, their intellectual property (IP). In
today’s economy, this property can often
be a company’s most valuable asset.
One way to keep track of your IP is to
have it audited every six months.
“If you have never audited your business’s IP, or more than six months has
passed since your last audit, then it is
imperative that you do so now,” says Frank
Herrera, Esq., chairman of the Intellectual
Property and Internet Law Group at Fort
Lauderdale-based law firm Rothstein
Rosenfeldt Adler. “Nearly all businesses
have IP, whether it is in the form of trademarks, copyrighted works, patents or even
Smart Business talked to Herrera about
the best way to protect IP assets.
What are some of the dangers of not protecting a business’s IP?
Surprisingly, many businesses consider
much of the competitive information they
maintain as a trade secret but fail to take
the appropriate measures to protect this
information from competitors, employees
or even ex-employees. Even more astounding is the fact that many businesses fail to
adequately protect and police their trademarks or copyrighted materials, letting
infringement run rampant. Some businesses fail to sufficiently exploit their patent
portfolio for potential licensing, which
could mean additional royalties added to
the bottom line.
Even seemingly successful businesses
simply do not systematically audit or otherwise maintain an inventory of their intellectual property. Rather, the concept of IP
usually comes to the forefront when the
business is most vulnerable — namely, at
the pre-litigation or litigation stage. Unlike
large businesses that continually monitor and exploit their IP portfolios, small businesses that don’t are missing out on leveraging their IP.
How and when should a business audit or
take inventory of its IP?
As a business owner, every six months,
with or without the help of an IP attorney,
- Check to see if your trademarks have
been registered with your state’s
Department of Corporations, the U.S.
Patent and Trademark Office or Foreign
Trademark Offices, if appropriate;
- If your company owns trademark registrations, double-check that the renewal
dates and other appropriate deadlines are
calendared to avoid abandonment or cancellation;
- Confirm that all essential trademarks
are the subject of a trademark watch service so that you will be immediately alerted
to unauthorized usage of a confusingly similar trademark;
- Make a list of information you consider to be ‘trade secrets,’ such as customer lists, product formulas and the like.
Evaluate whether your business treats
such information as a ‘trade secret’ and
make sure only key employees have access
to this information;
- Insist that key employees sign a
nondisclosure agreement to prevent them
from disseminating your trade secrets and
insist that they sign a noncompete agreement upon leaving. This prevents them
from working for a competitor for a reasonable amount of time, usually two years;
- Make sure all employees understand
that all content created for your business
— photos, brochures, software, etc. — are
works-made-for-hire under copyright laws
and the property of your business. If an
independent contractor creates works for
your business, insist on a signed agreement
that clearly sets forth that your business
owns all copyrights;
- When launching a new product or service use an attorney specializing in IP law;
- Review your patent portfolio, and
make sure all maintenance fee deadlines
are appropriately calendared, and decide
whether patents could be a source of
income by way of royalties;
- If you have any questions concerning
the status or health of your IP, make an
appointment to discuss them with an IP
While this checklist in not exhaustive it
should get you thinking about proper auditing and maintenance of your IP assets.
FRANK HERRERA, ESQ. is chairman of the Intellectual
Property and Internet Law Group at Fort Lauderdale-based law
firm Rothstein Rosenfeldt Adler, Attorneys at Law. Reach him at
(954) 315-7246 or [email protected].