The cornerstone importance of Intellectual Property Rights

In an ever-evolving, tech-driven, digitalized world, Intellectual Property Rights (IPR) are more important than ever.

Businesses are used to having to innovate to uphold competitive advantage, but to fully reap the fruits of innovation, the vast majority would benefit greatly from adopting a more pro-active approach to IPR.

At our recent breakfast seminar together with CMS Kluge and Håmsø, partners Thomas Rieber-Mohn and Krister Mangersnes shared valuable insights on how to navigate the sometimes-intricate legal waters surrounding IPR and innovation.

Today, an IPR strategy should be regarded self-evident as integral part of any general business strategy. Among the insights shared at the seminar were these:

1. On IPR and why these rights are so important

Intellectual Property Rights (IPR) cover a range of legal protections for different types of innovation. Through the grant exclusive rights, IPR create for the rights holder a temporary monopoly, supported by the law, ensuring businesses an opportunity to really capitalize on their innovation.

The term of exclusivity varies between different types of IPR – for patents, the exclusive right to utilize the protected invention endures for 20 years. IPR create revenues by awarding the owner higher degree of control over the pricing of products and services, and by allowing businesses to collect income from, e.g., the licensing of rights. IPR are very often also key assets in transactions.

Main types of IPR are patents, copyrights, trademarks, and designs. Patents cover inventions, defined as a practical solution to a technical problem – technical innovations. Copyright protects artistic and literary works, including, e.g., software (which is seen as a literary work).

Trademarks protect signs used to distinguish the goods and services originating from one supplier from those originating from others – tools used for branding purposes. Whereas design rights protect the visual appearance of products or a part thereof. Different types of IPR can overlap in one and the same product.

Apart from copyright, IPR require active steps to be established. In Norway, the Norwegian Industrial Property Office (Patenstyret) decides in first instance on applications for patents, trademark- and design rights. The application procedure, especially for patents, normally requires both technical and legal assessments to be made.

2. The basics of IPR strategy

Businesses need to adopt a strategic approach to IPR and are encouraged to think strategically about IPR from a business perspective, both in the board room and at executive levels.

This involves all aspects, from securing the establishment of IPR, handling IPR in company agreements, having internal routines for, inter alia, securing secrecy and IPR awareness among employees and securing the transfer of ownership to IPR from employees to the company, surveilling the market for “copycats”, pursuing infringements and maintaining good order over company IPR in case of, e.g., a future transaction, etc.

However, a good IPR-strategy should also reflect that structural control over innovation also can emerge from other sources than the law.

For instance, in some cases, upholding a technological advantage by being a “first mover” can be better strategic choice than using time and resources on securing legal positions through IPR. This often boils down to a cost/benefit analysis, the performance of which could benefit vastly from the guidance of a skilled and experienced advisor.

3. Handling IPR in contracts and transactions

In most agreements, IPR play a potentially crucial role.

Whether it's employment contracts, confidentiality agreements, consortium agreements or license agreements, etc., having clear and consciously moulded IPR clauses is paramount.

Such clauses help secure and distribute ownership according to intentions, grant tailored usage rights, prevent unwanted exploitation, and secure optimized revenue streams from IPR for the business.

Also in transactions, IPR normally play a key role. For instance, a secure, trustworthy and lasting access to key technology is essential to both investors and buyers. For sellers, the IPR “standing” of the business can greatly influence obtainable prices, and in some cases, IPR red-fags may overturn the whole transaction. For these purposes, businesses should continuously secure good order in all its IPR-related matters.

4. New holistic approach to IPR

Traditionally, the professional IPR-services have been split between patent agencies assisting in the establishing of IPR (such as the filing of a patent applications), and corporate lawyers handling the “legal work” once IPR protection has been established (such as the drafting and negotiation of contracts or assisting in court disputes).

By joint effort over time, CMS Kluge and Håmsø have developed a new, holistic approach to IPR services where, e.g. considerations as to how the patent will stand up in a future court dispute are taken into account up front, when the patent claims of the patent application are written. And, vice versa, the technical insights of the patent engineer are actively woven into litigation strategy when a court dispute emerges.

To mention some examples. This holistic strategy fosters both better quality patents (and other IPR), and greatly improves IPR-services throughout the lifespan of the rights.

One-stop-shop in Kluge

CMS Kluge and Håmsø offer a "one-stop shop" for all IPR-related needs on the ground in Bergen.

This includes both application-related assistance (patents, trademarks, and designs), as well as advise on IPR strategy, assistance in drafting and negotiating IPR agreements and in managing IPR transactions and -disputes.

For more information on how CMS Kluge and Håmsø can assist with your business’ IPR needs, please contact partner

Thomas Rieber-Mohn at thomas.rieber-mohn@cms-kluge.com or partner Krister Mangersnes at krister.mangersnes@patent.no.