Abstract

In today’s technological era protection of intellectual property has become the number one priority for businesses all over the world. The utilisation of intellectual property assets is a way for businesses to make profits. Any theft, leak or unlawful use of these assets can lead to unprecedented losses for any business. The most common way to protect intellectual property is to get it registered with the relevant government agency. However, this is not the only way. Intellectual property laws provide for other methods by which intellectual property assets can be protected. Copyright law states that there is no mandatory requirement for registration. Protection of original works will be granted from the very date of their inception or creation. Trademark law provides for the law of passing off. This helps in protecting trademarks which are not registered from being misappropriated by competitors in the market. Contract Law can also be utilised to protect intellectual property assets. Businesses can enter into non-disclosure agreements with parties they are doing business with. This will legally bind all parties to the contract to not disclose sensitive information about the concerned business. Apart from this businesses can also enter into non-compete agreements with their employees. This will ensure that the confidential information known to the employee about the business is not disclosed to its competitors when the employee leaves employment. The protection of intellectual property assets can also be insured by proper internal management. Businesses should ensure that they have a record of all the discoveries and creations made by them to record the date of creation of all works. Along with this businesses should be conscious of having a strict IT security infrastructure. Sensitive documents should not be able to be viewed by the entire workforce but only by the people concerned. Businesses should invest in Digital Rights Management software. This will help in controlling how their content and information are being used both by the public and by their internal management. An innovative way to protect intellectual property assets is to avoid joint ownership of these assets. This will lead to control over the intellectual property in one hand only which will be better than many hands having control over it. It will not only ensure more protection but also save the intellectual property asset from over-exploitation. To make profits and utilise the full potential of intellectual property assets businesses need to incorporate these various methods into their business model.

Introduction

We are surrounded by intellectual property assets. These assets are a big part of our lives, so much so that without them it will be difficult to imagine living. From Netflix shows to lifesaving drugs, from clothing brands to electronic appliances these creations are making our life better. Businesses invest huge amounts of money, time, and manpower in making and marketing these intellectual property assets. Thus, there is a lot of money at stake which makes protecting one’s intellectual property a top priority. However, to protect something it is important to understand the concept in its entirety. To protect IP assets, it is necessary to understand their meaning and their components. The World Intellectual Property Organisation (WIPO), the international body overlooking intellectual property rights and their development provide us with a small and apt definition of intellectual property. It states that intellectual property is something which is the ‘creation of mind’. The examples given to illustrate the point our ranging from literary works, artistic works, inventions, designs, symbols, images, and names used for commercial purposes.[i]

Types of Intellectual Property

There are various regimes under which different types of intellectual property is protected by law. The IP assets which involve creativity ranging from literary, musical, artistic, and dramatic works are protected by copyright. This means that original creations like music, books, movies, paintings, dance forms even computer programmes and databases are protected by copyright. Inventions which involve a unique process like a chemical formula for a drug or a unique product like a 3D printer are something which is granted protection under patents. Logos like the half-eaten apple of Apple.com or the LV mark of the fashion brand Louis Vuitton are protected as a trademark. Any mark or word that is distinctive in the sense that it is used to identify and distinguish a business from other businesses is protected as a trademark. Designs which are innovative, ornamental and have an aesthetic appeal can also be protected as intellectual property. Protection as the design is given to both two-dimensional and three-dimensional products. This protects the appearance of the product including its shape, pattern, and colour.[ii] Products are also protected through geographical indications. In this, a famous product which originated or is grown in a specific geographic area gets a GI tag which then signifies the quality and reputation of that product. A famous example in India is the saffron of Kashmir or the Sarees of Banaras. Apart from these even secrets and confidential information can be protected under intellectual property as trade secrets. Even though there is not a particular statute to protect trade secrets, they are protected by law under different legal regimes like the principles of equity and law against breach of confidence. The Information Technology Act 2000 protects confidential information stored in electronic records. [iii]

Registration of Intellectual Property

The simplest and most common way to protect the plethora of intellectual property assets we are surrounded by is through registration. This is the process under which the intellectual property is registered in the name of the owner with the government agency regulating the same. This provides proof of not only who is the owner of the intellectual property but also provides a surety as to the date of creation. This date of creation can be very important in cases of intellectual property disputes as whoever has created the intellectual property first will be given proprietorial control over it. In India, this duty is performed by the Office of the Controller General of Patents, Designs and Trademarks. However, registration is not the only way in which intellectual property owners can protect their assets. There are various other methods through which this can be achieved. Some of these are inherent characteristics of the various types of intellectual property and are protected by law as well.

Copyright Protection Does Not Require Registration

As noted, earlier copyright is a type of intellectual property which protect the works of the creative industries. The Copyright Act, of 1957 provides for the protection of original literary, dramatic, musical, and artistic works, cinematograph films and sound recordings.[iv] A unique thing about copyright is that it does not require prior registration. This principle is a part of the Berne Convention. Being a signatory to this convention India also upholds this principle in its statute. The provision dealing with entries in the register of copyright uses the word ‘may’ rather than ‘shall’ enunciating this principle.[v] All proprietorial rights in copyright subsist from the day of its creation. The only requirement is that it must subsist in a material form. Mere ideas are not given protection under copyright law. Every creation must be original and in material, form to be granted copyright protection. The registration requirement is only optional and not mandatory.[vi] In simpler words, it can be said that copyright protection is automatic.[vii]

Law of Passing Off

Another way in which the law protects intellectual property without the requirement of registration is through the law of passing off. Passing off is a common law tort. It is used to protect a person’s trademarks which are not registered from being misrepresented as someone else’s. It is applied in those cases where an unregistered trademark is wrongly used to confuse the minds of the consumers. This confusion can mislead the public to believe that the defendant’s and plaintiff’s trademarks are similar meaning it is the same business. This can lead further to the problem of the defendant freeloading on the goodwill of the plaintiff.[viii] In the landmark case of Reckitt & Colman Ltd vs Borden Inc[ix], the House of Lords gave three important elements to be applied in every passing-off case. These were called the ‘Classical Trinity’ and are of importance in passing off cases even today. These three elements are the plaintiff’s goodwill, misrepresentation being caused by the passing off action and the damage suffered by the plaintiff by the defendant’s action. In India, the Trademarks Act, of 1999 provides for remedy in cases of passing off. The right to initiate action in passing off cases is given under Section 27 of the Trademark Act, 1999.

Better Internal Management

Taking the legal route is not the only option for intellectual property owners to protect their intellectual property assets. They can also introduce certain practices in the internal working of their business which will help in protecting their intellectual property. One of the methods is to have an internal record of every discovery or creation the business has undertaken. This record will help in providing the date of creation of the intellectual property which will further help in proving ownership of the intellectual property assets of the individual or business in cases of disputes.[x] Apart from this method businesses must invest in having a robust IT security infrastructure. With the coming of the information technology era, there has been a spurt in reporting crimes like cyber theft. One of the famous cases involving the theft of intellectual property was reported last year by the European Medicines Agency. This case involved the leak of data related to the Covid-19 vaccine being developed by Pfizer/BioNTech.[xi] The lesson to be learnt from such incidents is that the internal records of the business must be kept safe at all costs. If steps towards this are not taken, then the intellectual property assets of the business are in danger of falling into the wrong hands and being misused. This can cause any business huge losses. Thus, to prevent such untoward losses investment in strong security IT features is a must for every business. As part of the security setup, businesses should also regulate who has access to internal documents. Sensitive documents should not be accessible to the entire workforce but only to the people concerned. This will help in preventing confidential information from being shared with competitors.

Non-Disclosure Agreements

Businesses can take recourse to contract law as well to protect their intellectual property assets. It is advised to enter into non-disclosure agreements which are legally binding contracts between parties to the contract which bars them from disclosing confidential information. These agreements can be entered not only between two businesses working together but also with new employees. Businesses should be mindful to have a robust and thorough non-disclosure agreement as it cannot be assumed that the parties understand the meaning of confidential information beforehand. A good non-disclosure agreement will always define what type of information it is covering. This is important because if not structured properly it will never be clear to the parties what they are bound to not disclose as part of the agreement. Since intellectual property like copyright, patents, and trade secrets give a competitive advantage to businesses these agreements are one of the best ways to protect these business assets. Since no law separately provides for the protection of trade secrets, non-disclosure agreements can be a good way to stop intellectual property assets from falling into the wrong hands.[xii]

Non-Compete Agreements

Another type of legally binding contract to protect intellectual property is a non-compete agreement. These are a type of agreement which are entered between an employer and an employee at the start of their employment. These agreements stipulate that an employee will not work with competition from their employers when they leave their jobs. This gives the employer control over the employee’s actions and use of the information they got to know during their employment period. These agreements are beneficial because they help businesses to protect their trade secrets from falling into the hands of their competitors. If not for the agreements employees are not any legal burden to not disclose sensitive information about their previous employees. This can lead to huge losses for a business as their employees can be poached by their competitors just to get their hands on their business assets including intellectual property. [xiii]

Digital Rights Management

As stated earlier we are living in the technological era. Businesses can use this technology to their advantage and protect their intellectual property assets. Digital Rights Management (DRM) is one such way where control can be exercised by owners to restrict the copying of their copyright material and proprietorial software. In this system, an algorithm gets created to control the use of intellectual property assets of a business or individual by the public. With DRM software in place, businesses can control the way users use their content. Today everyone has access to a smartphone and can edit and share without authorisation. This aspect of modern technology has impacted many industries most prominent being the music industry. So much so that it led to losses in the music industry all over the world in the early 2000s when the internet was introduced. To counter this problem DRM software came to the rescue of the music industry. Now all music publishers insist that music will only be shared on those platforms which have DRM software in place. A lesson can be learnt by businesses from the experiences of the music industry and protect themselves from unforeseen losses by unauthorised use of their copyright by investing in DRM software. DRM technology in addition to helping protect the use of content can also protect the use of confidential information. It has been used by many companies to restrict who has access to sensitive information and trade secrets of the company. In addition to ensuring that this information also gets shared safely with intended parties. Thus investing in DRM can be worth the money for all businesses as it provides a reliable and robust set-up to protect intellectual property assets.[xiv]

Avoid Joint Ownership

A legally innovative method to protect intellectual property assets without registering is to have full control over the intellectual property and avoid joint ownership. Under joint ownership, more than one entity gets control over the use of the intellectual property. In India, almost all statutes coming under the ambit of intellectual property laws provide for joint ownership of intellectual property. Under the Trademark Act, of 1999 it is provided under section 24 and characterised as jointly owned trademarks. Under this statute, jointly owned trademarks can only be registered in the name of the parties when they are held together. Meaning thereby such a trademark can only be used for those goods which are jointly being exploited by the parties. The Patents Act 1970 provides for the provision of joint ownership under section 50 as the rights of co-owners of patents. Joint owners can separately exploit their patents for profits but any action to assign the patent to third parties must be done with the consensus of all the owners of the patent. Under Copyright Act 1957 section 2(z) defines works of joint authorship. Authors who have created a work with the collaboration and the contribution of more than one author are works of joint authorship. Under Indian copyright law, there is no specific legal obligation to get into a contractual agreement to form joint authorship.[xv] In a landmark case, it was held that in copyright cases joint authorship will be determined by the contributions made by the authors. These contributions must be of ‘close and active intellectual collaboration about the final work’. [xvi] In cases of joint ownership not only do the profits get divided but any action related to the intellectual property asset like sale or assignment cannot happen without the assent of all owners. Moreover, the more owners more is the chance of the intellectual property asset being over-exploited. Thus, it is better to have a legal agreement with the parties involved in the creation of the intellectual property asset which avoids the situation of joint ownership giving sole ownership to one entity and one-time payment to other parties.[xvii]

Conclusion: To conclude it is pertinent to mention that protecting intellectual protect assets should always be the utmost property for every business. Even a minute of delay in this process can cost the business dearly and lead to unprecedented losses. Businesses and individuals should employ all methods from legal to internal management to protect their intellectual property. As it famously said prevention is better than cure, owners of intellectual property should strictly follow this adage. Being aware and conscious of protecting one’s intellectual property can save businesses from fighting long-drawn legal battles in court. Ultimately it will help in the thorough use of intellectual property assets and multiplying the profits for the business.

References:

[i] WORLD INTELLECTUAL PROPERTY ORGANISATION, https://www.wipo.int/about-ip/en/ (last visited on Nov. 17 2022).

[ii] GERMAN PATENT AND TRADEMARK OFFICE, https://www.dpma.de/english/designs/design_protection/index.html#:~:text=Parts%20of%20products%20can%20also,its%20shape%2C%20pattern%20and%20colours (last visited on Nov. 17 2022).

[iii] Hana Onderkova, A short introduction to trade secrets in India, European Commission IP Helpdesk, (Nov 17, 2022, 7:29 PM), https://intellectual-property-helpdesk.ec.europa.eu/news/short-introduction-trade-secrets-india-2021-11-05_en.

[iv] The Copyright Act, 1957, S 13, No. 14, Acts of Parliament, 1957 (India).

[v] Aparajita Nigam and Smrita Sinha, Copyright Registration not mandatory for enforcement of rights, India Business Law Journal, (Nov 18, 2022, 8:52 PM), https://law.asia/copyright-registration-mandatory-enforcement-rights/ .

[vi] Sanjay Soya Private Limited vs Narayani Trading Company, Bombay High Court, Interim Application (L) No. 5011 of 2020

[vii] Copyright Alliance, https://copyrightalliance.org/faqs/why-register-copyright/ (last visited on Nov. 18 2022).

[viii] Legal Services India.com, https://www.legalservicesindia.com/article/1254/Passing-off-under-trademark.html (last visited on Nov. 19 2022).

[ix] [1990] 1 All E.R. 873

[x] Legalzoom, https://www.legalzoom.com/article/how-to-protect-your-intellectual-proerty (last visited on Nov. 19 2022).

[xi] Computer Weekly.com, https://www.computerweekly.com/news/252510733/Top-10-cyber-crime-stories-of-2021 (last visited on Nov. 19 2022).

[xii] Investopedia, https://www.investopedia.com/terms/n/nda.asp (last visited on Nov 19 2022).

[xiii] Investopedia, https://www.investopedia.com/terms/noncompete-agreement.asp (last visited on Nov 19 2022).

[xiv] Digital Guardian, https://digitalguardian.com/blog/what-digital-rights-management (last visited on Nov 19 2022).

[xv] Ananya Singh, The rights of joint owners of intellectual property: an insight, Blog.IPleaders, (Nov. 19, 2022, 9:43 PM), https://blog.ipleaders.in/rights-joint-owners-intellectual-property-insight/?amp=1#:~:text=The%20jointly%20owned%20IPR%20may,extension%2C%20such%20disposal%20or%20exploitation.

[xvi] Najma Heptulla vs Orient Longman Ltd And Ors (AIR 1989 Delhi 63)

[xvii] Copyrighted.com, https://www.copyrighted.com/blog/protect-intellectual-property (last visited on Nov. 19 2022)