Think HBR

Using intellectual property rights to protect your business

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Brooke Murphy
Butlers Business and Law
‘Intellectual property’ refers to anything which is a creation of the mind. This definition includes things such as inventions, names, designs, symbols, images and literary works. Recent cases such as the Ozemite and Ugg disputes highlight how failures to properly protect intellectual property can cause lengthy legal battles and diminish the competitive advantage of a business.
For many businesses, intellectual property rights protect assets which are crucial to their brand. It is important to choose the types of rights which will provide the best protection of the intellectual property that is used in your business:
• Copyright is an automatic right which exists in creative works, and will protect the way that an idea is represented.
This is particularly relevant to businesses which use creative media, such as photographs or videos. Last year, the Federal Circuit Court ordered a travel agent to pay $24,000 in damages for using a Hawaiian photographer’s image without their permission.
• Trademarks give you an exclusive right to use your brand name or logo in respect of the goods and services you sell.
All trademarks must be registered with IP Australia. Trademarks must distinguish your product rather than just describe it. For example the word ‘apple’ could not be registered in relation to fruit, but it was able to be registered for computer products.
• Patents give an inventor the exclusive right to commercially exploit a novel invention for a limited period of time.
Patents are often granted for inventions in innovative industries, such as technology and pharmaceuticals.
However, other types of inventions can also be protected by patents, such as Mark Murray’s ‘Hamdog’ – a unique hamburger/hot dog combination.
• Designs are the physical forms or physical features of manufactured products. To be registered with IP Australia, a design must be both ‘new’ and ‘distinctive.’ Design is important in a wide range of products, such as computer accessories, cars, and spare parts.
Along with these rights, contracts can also be used to protect intellectual property. If you haven’t yet proceeded with intellectual property protection, you should use nondisclosure agreements to ensure protection in the interim. If an independent contractor creates intellectual property for your business, they may own the rights to the material they create unless it is otherwise specified in the service contract. In these circumstances, you must ensure relevant clauses are in the service contract assign ownership in intellectual property to your business. You must also be mindful of how contracts address intellectual property rights when you are purchasing a business. Intellectual property of the business must be assigned to the purchaser through the relevant agreements.
If you are unsure of whether your intellectual property is sufficiently protected, you should conduct an intellectual property audit. This involves a review of your intellectual property, related agreements, policies and procedures, and competitor’s intellectual property. This can be a beneficial process for both start-ups and established businesses.
For further information contact Butlers Business and Law on (02) 4929 7002, email or visit
Brooke Murphy Brooke Murphy

Brooke Murphy is a solicitor at Butlers Business Lawyers. She works with a variety of individuals, professionals and small to medium businesses with a range of commercial transactions including sales of business, leasing, and shareholders agreements. Brooke is passionate about obtaining the best possible results for clients, and understands the importance of practical, straight forward advice.