Intellectual property

Case BriefsHigh Courts

Kerala High Court: Shircy V, J. held that an author has the legal right to protect his intellectual property even after he has sold his authorship while also directing the trial court to take all endeavour to dispose of the case, within six months.

The appellant is a film director and a scriptwriter, who claims to have researched the history of a grand ancient festival ‘Mamankam’, and on this subject, he had written a script for a film. Subsequently, he met the first respondent and an agreement was made for making a film on it.

The counsel for the appellant contended that though the appellant was initially the director, he was replaced shortly after and the film was completed after changing and damaging the script. Hence, a suit was filed, with a petition for interim injunction to restrain the respondents from releasing or distributing the film, but it was denied by the District Court.

The counsel for the respondent Saiby Jose Kidangoor and V. Ramkumar Nambiar contended that the appellant had sold his authorship for a sale consideration of Rs 3 Lakh and so he is neither entitled to get the credit of the film regarding story or screen play nor entitled to stop the release of such a big-budget film.

In deciding the issues, the Court analysed the Copyright Act, 1957 and emphasized on Section 2(d) which gives the definition of word ‘author’, Section 18 which explains ‘assignment of copyright’ and Section 57(1) of the Act which prescribes that even after assignment of the copyright in a work, the author of a work will have special rights to claim the authorship of the work.

The Court further remarked that according to Section 57 of the Copyright Act, 1957, rights of the author is always protected as it places the author in an elevated position and copyright being a form of the intellectual property gives rights to the creators for their work. The Court further added that it is doubtless that the author of the work is the creator of literary art and it is his idea developed as a screenplay to make the movie. So here the appellant is the rightful owner of the script. However, the Court had to balance the appellant’s concern that the film is made by damaging his original script, with the respondents’ unease regarding the imminent release date of the film. 

The Court, taking a middle path observed that though the appellant is the actual owner of the script but the film is to be released in almost all cities in India as well in foreign countries and all arrangements for this have been made, and if the release is postponed for the reason of the name of the scriptwriter, the damages that would be caused to the respondent “will be huge and is beyond imagination”.

Considering all the facts and issues, the Court held that the film may be released without displaying anyone’s name as the scriptwriter thereof till the disposal of the suit while also directing the trial court to dispose of the case within six months. [Sajeev Pillai v. Venu Kunnapalli, 2019 SCC OnLine Ker 5338, decided on 11-12-2019]

Hot Off The PressNews

India has joined three WIPO treaties designed to ease the search for trademarks and industrial designs, helping brand owners and designers in their efforts to obtain protection for their own work.

 WIPO Director General Francis Gurry received on 7-06-2019, India’s instruments of accession to the Nice Agreement, Vienna Agreement and the Locarno Agreement from Ambassador Rajiv K. Chander, Permanent Representative of India to the United Nations and other International Organizations in Geneva. The treaties will enter into force for India on 7-09-2019.

  • Vienna Agreement Establishing an International Classification of the Figurative Elements of Marks [India becomes the 34th member of the Vienna Agreement]

  • Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks [India becomes the 88th member of the Nice Agreement]

  • Locarno Agreement Establishing an International Classification for Industrial Designs [India becomes the 57th member of the Locarno Agreement]

[News dt. 07-06-2019]

World Intellectual Property Organization

Experts CornerGUJCOST - GNLU

What do Google’s search algorithm, Coca-Cola and KFC’s original recipe, the selection criteria for the New York Times annual best seller list and the Big Mac special sauce recipe, share in common? These valuable recipes, methods and selection criteria are protected as trade secrets. Also called the “other intellectual property right (IPR)”, trade secrets does not dominate the popularity index with regard to the types of IP protection sought, corporations and individuals generally prefer other modes of IP protection. However, in the family of intellectual property rights, this right may be the oldest form because who does not have secrets. And what better measure to protect the secret than by keeping it undisclosed? Here a line of differentiation must be drawn between a personal and a professional secret as some professional secrets hold commercial value, like Coca-Cola’s recipe. What is the status of this form of IPR? A lack of consensus is found among nations and scholars alike regarding the recognition and treatment of trade secrets.

In this age of overcommunication, Coca-Cola’s recipe is one of the best kept secrets in the world. The company goes nostalgic in an account of its 125 years journey and presents proudly on its website some facts of its recipe.[1] The recipe was developed by John S. Pemberton, a pharmacist in 1886 and has been closely guarded, for more than a century.[2] Competitors have fiercely hunted for the recipe, yet apparently, this best kept secret has aided the Coca-Cola Company to become the successful, globally recognised brand it is today. Similarly, KFC has been a secret keeper for Colonel Harland Sanders’ recipe of 11 herbs and spices used by the fast food restaurant chain which has become its flagship product. The recipe is more than 70 years old and was apparently scribbled on the back of a door, which is being followed till date.[3] KFC has gone to a great length to protect this prized secret recipe, when it recently built a brand new, hi-tech home for the original handwritten recipe where the recipe is protected in a digital safe weighing more than 770 pounds encased in two feet of concrete with a 24-hour video and motion detection surveillance system.[4]

Where do these facts leave trade secrets with regard to the protection they provide and most importantly where does inclusion of trade secrets as a form of IP protection stand? Michael Risch opines trade secrets to be curious anomalies in intellectual property law and goes to argue that despite being the most important and litigated form of intellectual property, trade secrets are given derogatory treatment citing another work which terms this form “parasitic”.[5] On the contrary, trade secrets are justified by the economic benefits that flow from their existence, most notably incentives for businesses to spend less money protecting secret information or attempting to appropriate secret information.[6]

My Way or Yours? A Historical Perspective to Protection of Trade Secrets

The history of trade secret law is an interesting study in how certain intellectual property rights have developed. Whereas copyright, patent and trade mark law find legal justification through statutes, the trade secret concept and related reliefs grew out of the common law. Indeed, the very assumptions underlying patent and copyright laws—that government-granted rights can serve to incentivise the creation and sharing of new ideas and expression—are diametrically opposed to the notion of keeping information secret to gain a competitive advantage.[7]

The concept that so-called business or “trade secrets” were entitled to legal protection spread rapidly throughout the world. As early as the Renaissance, most European nation-States had laws that protected businesses (notably, the guild cartels) from those who used their secret processes and ideas without permission. During the Industrial Revolution, courts and legislatures translated these early laws into statutes that protected “industrial secrets”. Many of these statutes are still in force today, albeit in modified form. The modern trade secret regime traces most clearly and directly to the Industrial Revolution and is primarily an Anglo-American doctrine.

Currently, nations differ regarding their standpoint on treating trade secrets. Some have chosen to grant statutory relief to an act of trade secret violations while others treat the violations through popular principles of common law breach of confidence, etc. Looking at how nations seek to work together on various legal issues it is surprising how a unified treatment of trade secrets has not been possible. There is clearly no consensus on whether it be treated as a creature of contract law, tort, property or criminal law. With the continued confusion, none of these different justifications have proven entirely persuasive. Worse, they have contributed to inconsistent treatment of the basic elements of a trade secret cause of action, and uncertainty as to the relationship between trade secret laws and other causes of action.[8] Robert Bone has gone so far as to suggest that this theoretical incoherence suggests that there is no need for trade secret law as a separate doctrine at all.[9]

There is no State agency that “issues” (or even registers) trade secrets, thus categorising it separately from other forms of IP.[10] At the judicial level, courts will find misappropriation of trade secrets in two circumstances: (1) where the secrets were obtained by theft or other improper means, or where they were used; or (2) disclosed in violation of a confidential relationship agreement. However,  trade secret laws do not protect against independent discovery or invention. Nor do they prevent competitors from “reverse engineering” a legally (read fairly) obtained product to determine the secrets contained inside. Violations of trade secrets entitle the owner to damages and in some cases injunctions against the use or further disclosure.[11]

The International Framework of Trade Secrets

At the international level, the Trips agreement was the first international agreement to accord express protection to trade secrets. The agreement while defining trade secrets laid out its approach, based on the notion that in order to establish and maintain a fair and free market, protection against unfair competition should include protection for undisclosed information. While presenting this approach and defining the term, the Trips agreement referred to the prior existing protection as presented in the Paris Convention for the Protection of Industrial Property.

Trade secrets are dual in nature, they are confidential as well as commercial. To get the commercial benefit out of the secret, the owner must share it with a limited number of people or partners. Thus, laws expect and account for a certain amount of protected disclosure, within a constrained circle.[12] Nevertheless, even if trade secrets are not “secret” in the strictest sense of the term, they must, in fact, remain non-public and known only to a limited number of people.[13] The Trips definition of trade secrets reflects a broadly similar understanding of the term across nations and addresses its dual nature as confidential but commercial. Moreover, in order to place all nations on a similar footing, the Trips platform took into consideration then current practices in many countries while laying down a path for shaping subsequent laws.

      7. Protection of undisclosed information.[14]

Article 39

  1. In the course of ensuring effective protection against unfair competition as provided in Article 10bis of the Paris Convention (1967), members shall protect undisclosed information in accordance with Para 2 and data submitted to Governments or governmental agencies in accordance with Para 3.[15]
  2. Natural and legal persons shall have the possibility of preventing information lawfully within their control from being disclosed to, acquired by, or used by others without their consent in a manner contrary to honest commercial practices so long as such information[16]:

           (a) is secret in the sense that it is not, as a body or in the precise configuration and assembly of its components, generally known among or readily accessible to persons within the circles that normally deal with the kind of information in question;

                (b) has commercial value because it is secret; and

                (c) has been subject to reasonable steps under the circumstances, by the person lawfully in control of the information, to keep it secret.

  1. Members, when requiring, as a condition of approving the marketing of pharmaceutical or of agricultural chemical products which utilise new chemical entities, the submission of undisclosed test or other data, the origination of which involves a considerable effort, shall protect such data against unfair commercial use. In addition, members shall protect such data against disclosure, except where necessary to protect the public, or unless steps are taken to ensure that the data are protected against unfair commercial use.[17]

These three conditions define trade secrets in a manner covering a potentially very large scope of economic activity. The range of subject-matter covered by trade secrets may be open-ended, though often trade secrets fall into one of two broad categories: technical information (e.g. technical plans and formulae) and confidential business information (e.g. customer lists and marketing strategies).[18] However, an interesting point is that trade secrecy does not provide an exclusive right for a specific time-limit, which means its discovery by a second party through fair means or entry in the market, and they can run out in the regular course of the competition, unlike patented inventions or copyright protected content.

Conclusion

Trade secrets are a form of intellectual property, serving the same purpose as patent, trade mark and copyright laws i.e. promotion of innovation. While protection under trade secrets results in reduced investment in terms of money and time, on the contrary it does not provide an exclusivity over the secret, if a second party learns the information through fair means in the market. A proper understanding of trade secrets as an intellectual property right will let them be absorbed by society and encourage the formation of a law designed in order to promote innovation.

With varying patentability standards across nations, patent rights have become increasingly uncertain, especially when there is a movement in many countries to further raise the bar as far as the patentability criteria are concerned. To address this situation if the trade secret law is strengthened across the world, it will provide a viable option to inventors to keep their inventions secret. More importantly, stronger protection under trade secret law will ensure enhanced protection to tacit knowledge or know-how that may complement a patent, enabling the owner to protect his patented technology better in fact even beyond the patent period.

India does not have a dedicated law in place to protect trade secrets, however, there is a rich stock of jurisprudence that got introduced through cases, covering the definition and scope of trade secrets, protection remedies and so on. However, there is an increasing expectation that India introduces a statutory protection for trade secrets but time alone can tell whether it is to take place.

*Hetvi Trivedi is Research Associate, GNLU-GUJCOST Research Centre of Excellence in IP Laws, Policies & Practices.

[1]  Coca-Cola journey, available at <https://www.cocacolacompany.com/content/dam/journey/us/en/private/fileassets/pdf/2011/05/Coca-Cola_125_years_booklet.pdf>.

[2]  Ibid.

[3] What Made Us Great is Still What Makes Us Great, available at <https://www.kfc.com/about>

[4]  R. Mark Halligan and David A. Haas, The Secret of Trade Secret Success, available at  <https://www.forbes.com/2010/02/19/protecting-trade-secrets-leadership-managing-halligan-haas.html#77ea0d661372>.

[5]  Michael Risch, Why do we have Trade Secrets, p. 3 (2007).

[6]  Id., p. 5.

[7]   Id., p. 6.

[8]  Miles J. Feldman, Toward a Clearer Standard of Protectable Information: Trade Secrets and the Employment Relationship, 9 High Tech. LJ 151, 161-163 (1994).

[9] Robert G. Bone, A New Look at Trade Secret Law: Doctrine in Search of Justification, 86 California Law Review 241 (1998).

[10] Peter S. Menell, Mark A. Lemley and Robert P. Merges, Intellectual Property in the New Technological Age: 2017, Vol. I: Perspectives, Trade Secrets and Patents, p. 62 (2017).

[11]  Ibid.

[12]  OECD, Enquiries into Intellectual Property’s Economic Impact, p. 132 (2015).

[13]  Ibid.

[14]  Trips agreement, available at <https://www.wto.org/english/docs_e/legal_e/27-trips.pdf>.

[15]  Ibid.

[16]  Ibid.

[17]  Ibid.

[18] Id., at p. 62.

 

Conference/Seminars/LecturesLaw School News

Date : 15 February 2019

Time : 10:45 AM to 5:00 PM

The ILS IPR Cell is organizing One Day National Seminar on: “Unveiling Ventures of Intellectual Property Law”. This Seminar is being organized to introduce participants to the practical aspects of Intellectual Property Law. Intellectual Property Law (IP) refers to creations of the intellect for which a monopoly is assigned to designated owner by law. Intellectual property rights (IPRs) are the protections granted to the creators of IP. Intellectual Property law has evolved for centuries and by late 20th century, it became common place in majority of the world.

Topics to be covered:-

  • Non-Conventional IPRs in India
  • Changing Dimensions of Patent Regime in India”
  • IPR and Biodiversity in India
  • Interface of IPR and Competition Law

List of Speakers:-

  1. Dr.Feroz Ali Khader, MHRD IPR Chair, IIT Madras
  2. Ms. SunitaSridharan CEO, SKS Law Associates
  3. Dr. Arul George Scaria Faculty, NLU Delhi
  4. Rahul Ajatshatru Founder and Principal Attorney, AJATSHATRU Chambers

Who Can Participate?

  1. Law students from all courses.
  2. Academicians
  3. Jurists
  4. Legal practitioners
  5. Professionals from law firms
  6. IP Professionals
  7. Corporate counsels
  8. Medical professionals and practitioners
  9. Public health activists
  10. Authors
  11. Actors, dramatists and cultural performers
  12. Professional comedians
  13. Enthusiasts of the laws of Constitution, Taxation, IPR and Competition

Participation shall be in the form of attendance and interaction in sessions.

Registration Procedure and Fee Schedule :

Students (ILS) Rs. 400/- inclusive of GST
Students ( Non-ILS) Rs. 700/- inclusive of GST
Professionals Rs. 1000/- inclusive of GST

Fee is inclusive of the reading material, lunch and Certificate of participation (only for outside ILS) for the participants

All payments shall be made online through the link

Last Date of Registration: 10th February 2019.

 CONTACT DETAILS :

(1) FACULTY CONVENERS :   Dr. SUVARNA S NILAKH

(2) STUDENT CONVENERS

(a) CHAITANYA REDDY      +91-8143593098

(b) PRANITA SABOO            +91-9404509717

(c) SHREYA KUNWAR         +91- 8777295355

(d) SURABHI SMITA             +91- 7021409156

Call For PapersLaw School News

The Cell for Studies in Intellectual Property Rights (CSIPR), incorporated under the aegis of Prof. (Dr.) Ghayur Alam, Chair of IP Law at the National Law Institute University, Bhopal (NLIU), is now accepting submissions for Volume 8 of the NLIU Journal of Intellectual Property Law.

About the Journal

The NLIU Journal of Intellectual Property Law, published annually, is run by CSIPR at NLIU, guided by our illustrative faculty and is reviewed by a body of peers comprising our alumni. It aims to create meaningful debate and discourse to help build a fair and equitable regime of intellectual property law and to study the dynamic confluence of the academic and the transactional world presented by these laws.

The Journal has, in its past Volumes, published articles and papers by academicians, lawyers and law students from across the world and seeks to expand its reach through Volume 8. Submissions are invited for genuine, original and unpublished written works. We invite contributions from persons across the legal profession-research scholars, professionals, students and others for this issue.

Vision Statement

“To promote the culture of knowledge creation in India.”

Mission Statement

“To promote research and sharing of ideas in the field of Intellectual Property Law.”

Categories for Submission

Submissions can be made under the following categories:

Articles (3500-6000 words*): Article is expected to do a thorough and in-depth analysis of the problem(s) and idea(s). It must take the discussion to a logical and meaningful conclusion and must contribute to existing knowledge in the field of intellectual property law.

Notes (2000-3500 words*): Note must either initiate a new discussion or provide a summary of a recent development in the field of intellectual property law.

Case Comments (2000-5000 words*): Case Comment must be an analysis of a recent judgment pointing out its contribution to the development of intellectual property law. If the judgment selected has not decided the case of first impression, the Comment must provide a comparative analysis of all the judgments from the same jurisdiction on the same subject matter.

Book Review (1000-3000 words*): Book Review must identify and explain the strengths and weaknesses of a recently published book.

*The word limit is inclusive of footnotes. Kindly adhere strictly to the word limit prescribed.

Guidelines for Submission

All submissions must be accompanied by an abstract not exceeding 300 words. The topic must be of contemporary relevance. The abstract must expressly include the novelty and usefulness of the idea that the author wishes to put forth and must categorically mention the specific contribution of the article, beyond the existing available literature, and the practical utility of his/her recommendations.

The introduction must introduce the topic, explain in brief the researchability of the topic, and delineate the structure of the article. The author must also identify the works already existing on the topic, pointing out any gap in the existing literature and clearly formulate the research problem and the hypothesis. Overall, the submission must meet the requirements of novelty and usefulness.

Co-authorship is permissible up to a maximum of two authors. The body of the manuscript should be in Times New Roman, Font Size 12 and in 1.5-line spacing. The footnotes should be in Times New Roman, Font Size 10 and in single line spacing. The citations must conform to The Bluebook style of citation, 20th edition. (attached below)

Kindly send your manuscript in MS Word (.docx) format to nliu.journalofiplaw@gmail.com, latest by 20 December 2018, 11:59 PM.

The subject of the e-mail should be “Submission for Volume 8 – (Title of the manuscript)”.

The submission should be accompanied by a Covering Letter which must include the following details:

  • Name of Author(s)
  • Contact Details – Address and Mobile No.
  • Name and Address of Institution
  • Course currently being pursued/Academic Qualifications

Copyright: The submissions for the Journal must not have been previously published or submitted for publication elsewhere.  The contribution presented and accepted for publication and the copyright therein shall be the intellectual property of NLIU. 

Contact 

In case of any queries kindly drop an email at nliu.journalofiplaw@gmail.com or contact:

  • Udyan Arya Shrivastava, Convenor, CSIPR: +91 8982605691
  • Manasvi Tewari, Co-Convenor, CSIPR: +91 94071166411
Experts CornerGNLU - Microsoft

Blockchain — the technology infrastructure behind bitcoin and many other emerging platforms have been a hot topic recently, with multiple industries exploring their possibilities and new blockchain use cases emerging almost every day. Blockchain technology is poised to revolutionise almost everything from supply chains including illegal fishing and human rights abuses. It is flourishing in an open-source environment, which raises the question whether our current intellectual property (IP) laws are fit for the purpose to foster innovation.

 

 

 

 

 

What is blockchain

Blockchain is an open ledger of information that can be used to record and track transactions, and which is exchanged and verified on a peer-to-peer network. Blockchain and other distributed ledger technologies create a trustworthy and transparent record by allowing multiple parties to a transaction to verify what will be entered onto a ledger in advance without any single party having the ability to change any ledger entries later on. Each transaction or “block” is transmitted to all the participants in the network and must be verified by each participant “node” solving a complex mathematical puzzle. Once the block is verified, it is added to the ledger or chain.

From the perspective of information, the real innovation of distributed ledger technology is that it ensures the integrity of the ledger by crowdsourcing oversight and removes the need for a central authority. In other words, transactions are verified and validated by the multiple computers that host the blockchain. For this reason it is seen as “near unhackable”, because to change any of the information on it, a cyberattack would have to strike all copies of the ledger simultaneously. While the traditional concept of blockchain is an open and anonymous network, there are also “private” blockchains which prescreen as to who is allowed to administer the ledger.[1]

Attractive beyond the world of fintech

Since distributed ledger technology creates a secure, time-stamped and immutable chain of information, it is already finding applications in brand protection and enforcement, marketing and consumer engagement. More use cases seem to emerge on an almost daily basis. The technology has fast become attractive beyond the world of fintech. It is already being used to track the progress of goods in a supply chain, which is of interest to many IP-intensive sectors including the pharmaceutical, automotive, luxury and consumer goods industries, where the traceability of goods is important and counterfeit and grey goods are of concern.[2]

Blockchain is attractive to many different industries because of its potential uses. Different types of data can be added to a blockchain, from cryptocurrency, transaction and contractual information to data files, photos, videos and design documents. And the technology is continuing to develop with new types of distributed ledgers such as hashgraph software, which seeks to address issues of scalability.

Intellectual property laws incentive theory

Intellectual property laws, such as patents and copyright, are premised on the incentive theory. To incentivise people to create, they are given, in effect, a monopoly on their creations and, can go to court and stop others from free riding on their work.

The digital world has made the tension between innovators and free riders even more acute. In the pre-digital era, copying a book incurred considerable costs for the copier. Now, given that digital files can be copied indefinitely for near zero cost, one could argue that we need even stronger IP laws to prevent rampant and unfair copying.

But theory does not always match reality. History is littered with examples of patents harming rather than aiding innovation. James Watt’s steam engine was an advance over existing steam engines, yet the technology could not be built upon because of Watt’s patents. It was not until the patents expired — one of which had inexplicably been extended by Parliament — that steam power came into its own in driving the industrial revolution.

Blockchains and IP rights

Companies are investigating blockchain applications such as IP rights clearance and royalty payments, and some say the technology has great potential for managing digital rights such as copyright. They could also potentially be used to embed digital rights management into the digital signature structure, or to record the provenance of content and track its use.

The “great excitement in this industry is palpable”, and the issue of whether any blockchain technology should be patented, which had been put to one side until now, is growing in importance.

A search of the term “blockchain” showed that no developers have any issued patents containing that name, but the companies interested in using the technology have filed blockchain patent applications. Published applications containing the term “blockchain” have been filed by Texas Instruments, Panasonic, Marvell, LG, Intel, Apple, Qualcomm, IBM, Toshiba and Samsung, said Keller. Blockchains are expected to create new markets first in the financial services sector.

“Speed bumps”: Court decisions and open source

The main “speed bumps” in the IP landscape around blockchains are whether they are patentable, the intersection of IP and open source, and the question of trade secrets and open source.

The 2014 US Supreme Court decision in Alice Corpn. v. CLS Bank International[3] held that a claim cannot be drawn entirely to an abstract idea. The High Court established a two-set test for determining whether a computer-implemented invention is patent-eligible, with most of such inventions being denied patents.

Since Alice, however, two further decisions, DDR Holdings, LLC v. Hotels.com, LP[4] and Enfish, LLC v. Microsoft Corpn.[5], have raised hopes that software patents may be more easily obtained, but it is still a challenge.

Compatibility issues between the open source GNU General Public License v3.0 and Apache 2.0 create another problem. There are hundreds of different open source licences, but the six most common licences cover around 90 per cent of open-source projects. Around 55 per cent use a “copyleft” licence which offers people the right to freely distribute copies and modify the software as long as the same rights as in the original open-source licence are preserved in the derivative version. But GPL may not be compatible with a company’s licensing strategy, and GPL 3.0 also prohibits the use of trade secrets.[6]

These issues can be resolved. “But it is important that people understand the impact of their decision to use open source (e.g., what type of open-source licence to use) has on IP as well as the impact of their decision to, say, patent an invention used in a blockchain on what types of open-source licences would be acceptable.”[7]

Conclusion

It is a matter of finding the right balance to encourage and reward innovation with practical solutions that the marketplace accepts. Before you go to market, questions about whether to use trade secrets or copyright to protect blockchain technology show how early in its infancy the industry is. Patents will be the primary mechanism for protecting IP in blockchains, but the situation will become clearer as the sector develops.

Only 685 patents have been filed in the US. And, unlike, say, a pharmaceutical innovation which is of substantial benefit for a company to own and keep closed, there is little value in making blockchain platforms proprietary.

The platforms need to be open and free of IP entanglement so innovators can add value through applications or by providing better services than rivals. Higher up the systems, however, above the blockchain network, patents for proprietary technology could make sense.

 

Vaishali Singh is Research Associate, GNLU-Microsoft IPR Chair, Gujarat National Law University.

[1] Ament, D. Report and Recommendations of the Technical Upgrades Special Project Team, 2015. Available at <https://www.copyright.gov/technology-reports/reports/usco-technicalupgrades.pdf>.

[2] Boucher, P., Nascimento, S., and Kritikos, M. How blockchain technology could change our lives, 2017. Available at <https://pdfs.semanticscholar.o rg/0a09/9da451b5be9a5c7fa6cbd66afec33a240c91.pdf>.

[3] 189 L Ed 2d 296 : 134 S Ct 2347, 2354 : 573 US—(2014).

[4] 773 F 3d 1245 (Fed Cir 2014).

[5] 822 F 3d at 1339, 1327 (Fed Cir 2016).

[6] McMullen, G. Blockchain & Law in 2017, 2017. Available at <https: //medium.com/ipdb-blog/blockchain-and-law-in-2017-f 535cb0e06c4#.96qcsc1mu>.

[7] ibid.

Experts CornerGNLU - Microsoft

Intangible form of property

Intellectual property is an intangible form of property. It is a creation of human intellect which forms an integral part of our life. Starting from an alarm clock that annoys us in the morning to an interesting novel that makes us dream at night, we are surrounded by the fruits of human creativity and innovations. It serves to protect creative and inventive human expressions. Intellectual property rights, being imperative tools for the economic and industrial development of the nation, the laws protecting them have assumed great importance in the era of globalisation and privatisation.

IP: Source of value and wealth generation

The term “intellectual property” which was hardly known to the CEOs in early ‘90s has become one of the most significant parts of their business strategy.[1] Intellectual property has great significance for any large scale, medium scale or even a small startup as it has become an important source of revenue generation. In this age of knowledge and technology, generation of revenue is through creation of intellectual wealth. The intellectual wealth so generated requires strategic and structured approach towards identification, protection and exploitation for revenue generation. The source of value and wealth generation has moved from tangible to intangible assets. Intangible assets as recognised to be intellectual property are nothing less than potent weapons in the age of global competition. Intellectual property rights are not mere legal instruments but are tools of business. Thus, the area of management of intellectual property rights (IPRs) has great significance in the present world of explosive technological developments. With the rapid growth in diversified fields of technology, with the new scientific inventions and innovations, IPR protection and IPR exploitation is the key to commercialisation for any organisation. There is no doubt that the success in the smart phone industry is completely based on innovations. Some of the leading examples of success stories like software—Microsoft, hardware—Dell, and formulations—Coca-Cola are substantiating the fact that managing intangible asset can take any organisation on the path of success.

What is IP management

Management of IP includes the entire process of identifying, acquiring and protecting intellectual property of the organisation for the purpose of value and wealth generation.

Need for strategic management of IP

Strategic management of intellectual property for any organisation fosters creativity and innovation leading to generation of IP with potential for value extraction. It facilitates licensing and technology transfer of IP as well. It further leads to enhancing in-house competencies in understanding, identifying, generating, protecting, sharing and transferring IP. Strategic management of IP also helps prevent any unethical acts to avoid IP infringement at all levels and develop guidelines and facilitates IP sharing in joint development and collaborative projects with third parties. It helps the organisation maintain competitive edge.

Strategies to manage IP

Strategic management of intellectual property is needed at all stages starting from concept to commercialisation. Managing an IP portfolio is not merely acquiring a formal recognition of type of intellectual property right through a certificate of registration issued by the national IP office. IP management encompasses all IP rights including patents, designs, trade marks, copyrights, semiconductor integrated circuits layout designs, software programs, industrial designs, logos, confidential information, drawings, source codes, technical information, and any other knowledge/know-how created by the employees and affiliates of the organisation.[2] Strategic IP management impacts opportunity exploitation and the utilisation of existing resources. In order to support opportunity exploitation activities, IP management must ensure freedom to operate within a certain domain, for example a patent does not provide the patent-holder freedom to operate; exclusive rights related to necessary complementary resources can be held by other agents restricting and blocking the freedom to operate, possibly leading to hold-up problems and tragedies of the anticommons.[3] Further it can also be said that strategic IP management impacts opportunity exploration and dynamic capabilities. An example is the use of Frand requirements in some standards, meaning that participants must agree to licence out their essential patents to fair, reasonable, and non-discriminatory (Frand) licensing terms. A “tight” appropriability regime is then not necessarily most conducive for dynamic competitiveness, especially not if widening the scope from the firm perspective to the perspective of innovation networks and technological ecosystems. Strategic IP management can thus be used to proactively ensure accessibility to innovations, in order to promote cumulative innovation under certain conditions.[4]

Identifying IP.— Under the wide-ranging head of intellectual property rights, various forms of innovations are protected as patents, trade marks, copyrights, industrial designs, trade secrets and many more. The identification of IP is not a simple exercise. Hence, it is important for an organisation to carefully consider the importance of IP to its operations before embarking on what may be a fruitless and costly journey. Therefore following issues have to be addressed while identifying an IP that a company owns are as follows:

(i) Selecting a company name, domain name and trademark.

(ii) Identifying your products or services.

(iii) Determining which of your products and services can be protected as IP.

(iv) Distinguishing what type of IP protection applies to each of your products and services.[5]

Acquiring.— Considering the potential of value and wealth generation, IP assets should also be considered from a long-term point of view. Hence acquiring IP includes managing the chain of title to company-developed IP.

Monitoring.— It has to be done of the internal and external use of IP. All types of IP portfolio has to be systematically monitored. Once IP rights are acquired, one must take more steps to enforce those IP rights; if you do not, then there is no consequence to a potential infringer.

Commercialising.—When it comes to transfer technology from research organisations (ROs) to the business sector or to manage the intangible assets in small and medium-sized enterprises (SMEs), the intellectual property (IP) commercialisation practice is a key factor. Commercialisation is therefore the process of bringing the IP to the market in order for it to be exploited in return of business profits and growth. The financial success of any IP commercialisation will certainly depend on the choice of the most appropriate commercial tool.

IP commercialisation: The Unidyne case[6]

Unidyne Energy Environment Systems, a company engaged in manufacturing various insdustrial thermal energy systems. In 1999, Unidyne signed a memorandum of understanding (MoU) with Indian Inventor, Dr Milind Rane, who developed the design of matrix heat recovery unit (MHRU). This invention was used for recovering heat from hot gases and/or vapors from engines, boilers or furnaces. Unidyne saw value in the patent application, which was still not granted the status of a patent by the patents office. Dr Rane, through the MoU licensed his technology to Unidyne to manufacture and sell MHRUs. The patent was granted in 2004 and is now being used by more than 45 companies in India. For Unidyne, the agreement act as a tool to boost its product.

                                                                  Figure 1: Common forms of IP commercialisation[7]

Intellectual property is outcome of knowledge and creativity. It is foundation for evolution and progress in each and every sphere of human accomplishments. Moreover in the age of information technology, intellectual property rights and intangible assets are gaining significant importance. Businesses cannot ignore the developments in the intellectual property regime. Intellectual property rights and intangible assets represent a major portion of the assets of a business, thereby constituting a large share of its value. Managers must be equipped with the necessary understanding of the tools and techniques that help them to protect innovations of the business, the creative works surrounding these innovations, the look, feel and design of the products as well as brands which generate value to the business. The national IPR policy also emphasises the need for a strategic perspective in managing intellectual property and has put in place a lot of measures to facilitate the “mind to market” among the MSMEs and other industries. There is an evident urgency in implementing an effective IPR policy within organisations in order to achieve its overall strategic intent.

*Vaishali Singh is Research Associate, GNLU-Microsoft IPR Chair, Gujarat National Law University.

[1] Jain, Karuna, Intellectual Property Management System: An Organisational Perspective, Journal of Intellectual Property Rights (2006), pp. 330-333.

[2] See William W. Fisher III & Felix Oberholzer-Gee, Strategic Management of Intellectual Property: An Integrated Approach, California Management Review (2013) 55 CMR.BERKELEY.EDU, available at <http://www.hbs.edu/faculty/Publication%20Files/CMR5504_10_Fisher_III_7bbf941f-fe1b-4069-a609-9c6cd9a8783b.pdf> (last accessed on 21-11-2017).

[3] See Holgersson Marcus, Innovation and Intellectual Property: Strategic IP Management and Economics of Technology, available at: <http://ssrn.com/abstract=2563297> (last accessed on 1-12-2017).

[4] Ibid.

[5] See MaRS Entrepreneur Workbooks, Identifying your intellectual property, available at: <https://www.marsdd.com/wp-content/uploads/2010/12/Identifying-Your-Intellectual-Property-WorkbookGuide.pdf> (last accessed on 1-12-2017).

[6] Bandyopadhyay, T.K., “Introduction on Intellectual Property to Engineers and Technologists”, available at: <http://textofvideo.nptel.ac.in/109105112/lec40.pdf>. See also <http://www.unidyne-energy.com/> (last accessed on 23-11-2017).

[7] See <http://ship.mrc.ac.za/invention.htm>.