No one knows this better than Joey Ruiter, principal at JRuiter Studio, a Grand Rapids-based industrial design studio.
“There’s just so much that we’ve got access to today,” Ruiter said. “It’s an open-source environment. I think there’s odd stuff going on with who owns what these days, because as soon as you put anything online people think they own it.”
Many companies, especially small businesses, are grappling with these issues as they try to develop their brick-and-mortar stores into online presences. Other small businesses starting out are dealing with trademark infringement issues and the challenges of maintaining intellectual property rights in an ever more connected world.
Tim Eagle, intellectual property lawyer at Varnum LLP, deals with these issues with clients on a regular basis, especially trademark issues.
“Certainly any small business that is interested in adopting a mark is faced with a choice: whether or not to do any due diligence in order to ensure there are no prior rights-holders,” Eagle said. “The questions are: Is there somebody out there with pre-existing rights to the trademark, or is there someone out there who has a well-established trademark that you would run the risk of diluting?”
Oftentimes, small businesses will not think about the potential issues that taking a trademark or name may have down the line.
To avoid those situations, Eagle recommends that small businesses take the time to do due diligence on their trademark and name before any issues can arise. This is especially important for companies that are just launching, he said.
“This can range from a simple computer search that companies can do themselves to hiring lawyers or a search firm,” Eagle said. “Certainly, if a company is launching, it makes sense to invest time and money into searching.”
For other intellectual property such as manufacturing processes, formulas and designs, Brian Cheslek, an intellectual property attorney at Price Heneveld LLP, suggests that companies start early and identify their intellectual property (IP).
“Any company will have IP, regardless of size,” Cheslek said. “The first thing businesses need to do is determine what the IP strategy will be.”
That’s when Cheslek says legal counsel should be contacted. Both Eagle and Cheslek said businesses should work with their lawyers to determine how they will protect their intellectual property, whether their IP strategy will be defensive, offensive or both, which is the option that Cheslek recommends.
“Owners should be cognizant of other companies and be aggressive,” said Cheslek. “In a way, it’s no different than real property. A farmer wants to keep people off their land. You want to keep people off your IP, per se.”
The challenge of maintaining control over intellectual property and trademarks is that intellectual property is a constantly moving target, the attorneys said. Companies continually develop new products and procedures, name new products and divisions and create new manufacturing processes. The question then becomes: How can companies keep up to date with all the intellectual property they’re generating? The answer, Cheslek says, requires a significant amount of planning.
Cheslek said businesses really have two options when dealing with their intellectual property: 1) They can create a plan for maintaining the IP as a trade secret, or 2) They can develop a procedure to register and protect the IP.
Coca Cola’s handling of its classic recipe is an example of good procedures to follow for maintaining a trade secret, Cheslek said. The number of people who know the entirety of the recipe is kept to an absolute minimum, meaning that the workers on the line only know their particular step in making the formula and not the whole recipe, he said.
The downside to having trade secrets is that businesses need to be able to maintain the secrecy against disgruntled former employees and industrial espionage, Cheslek said. The other option is to register and defend IP in court.
“Whatever IP you develop, you have to ‘harvest’ it,” Cheslek said. “There are resources online that are helpful for initial minesweeps, but they don’t replace a patent attorney.”
The most important piece that both Cheslek and Eagle said companies need to remember while dealing with IP is that the process of registering and protecting it is continuous.
“IP is constantly evolving as a consequence of inventors,” Cheslek said. “Your IP strategy is never really finished.”
That’s something that Ruiter, an industrial designer, knows all too well. In the existing open-source environment, keeping tabs on your IP or your design can be a never-ending process.
“I think things are culturally changing really quickly, and I don’t think designers have their eyes opened yet,” Ruiter said. “There’s just so much that we’ve got access to. You put something online and it goes viral immediately. Popularity is an issue right now. Design is playing a major role, and I think that’s cool, but I think it also creates a monster.”