What It Takes

 

­Correcting IP title defects requires getting the proper ownership agreements signed between the company and the people who created the IP assets. Mind you, this is always legally more powerful before the assets are created (which is what the new processes and procedures are meant to enforce in the future), but an after-the-fact agreement still works. And make no mistake, you'll be going back to a former outside contractor on bended knee asking for a new agreement to be signed months or years after the work was originally done. This can be awkward at best and expensive at worst, as the contractor is always likely to detect the sweet smell of money in the air and attempt to part you from some of it in exchange for the signature you request.

Correcting completeness defects is simply a matter of filing for whatever patents, copyrights and trademarks are missing in the portfolio, and instituting internal disclosure and management procedures for identifying and assessing new innovations on a constant basis so that new IP doesn't slip through the corporate cracks in the future.

Finally, correcting strength and enforceability defects requires a measure of strategic attention to ensure that the company's innovations are being protected in the strongest possible ways in light of the competitive landscape in which they exist. For some innovations, a slew of patents will be the answer; other innovations will best be kept confidential in reliance on trade secret law; for yet others, a mix of patents and trade secrets, as well as copyrights and trademarks, will provide the most bang for your buck.

IP law is esoteric, arcane and often counterintuitive. Normal business assumptions do not always apply, and can prove to be quite risky. Aggressive, thoughtful, expert management of your IP portfolio is a sound, conservative business practice.

IP rights, especially patents, have lately become a thriving form of currency among a large and growing number of market participants. An entire subculture of IP "investment banks," speculators, traders, "trolls," auction houses and the like has arisen to make a market in IP.

Underlying the growth of this market is a shared understanding of the fundamental principle that IP generates licensing revenues when asserted against potential infringers-who often agree to pay royalties as a much cheaper and more predictable alternative than the exorbitant expense of IP litigation-and can ultimately result in large damage awards against competitors who refuse a license.

This, in turn, means that more applications to secure IP rights are being filed every year as more companies attempt to establish exclusionary beachheads in what they imagine to be the important technologies of the future. It also leads directly to more IP being asserted more aggressively than ever against potential infringers. It is not hyperbolic, then, to suggest that viable participation in modern commerce requires careful attention to one's IP.

The expense of an IP audit is always directly proportional to the number of documents requiring review. If the IP portfolio is large, so too will the legal bill be. Nonetheless, maintaining a strong IP portfolio is an essential strategy in today's knowledge economy. Thus, an IP audit is almost always worth the money, if only so you can sleep at night. 
 

Brent C.J. Britton is a lawyer in the Tampa office of Squire, Sanders & Dempsey LLP, a global law firm. A graduate of the MIT Media Lab, he practices intellectual property and corporate law.