PROTECT YOUR RIGHTS BY LEVERAGING YOUR MOST VALUABLE ASSETS
“Intellectual capital is the most important asset of many of the world’s companies; it is the foundation for the[ir] market dominance and continuing profitability. It is often the key objective in mergers and acquisitions. One of the key factors affecting a company’s success or failure is the degree to which it effectively exploits intellectual capital and values risk.”
-- World Intellectual Property Organization (ellipses omitted).
IP assets can support a company's growth and success in many different ways:
PROTECTION FROM COPYCATS: A valid and enforceable patent that is properly written can protect a company from its competitors and other established companies trying to rip off its technology for a generation (20 years from filing date).
INVESTMENT VEHICLE: Early investors not only view patents and other IP rights as key tools in establishing and maintaining brand distinctiveness, but also as fall-back assets "securitizing" the funds they have at risk, and as evidence that the company's technology is groundbreaking. Patents and other IP can therefore play a key role in helping small companies obtain funding by attracting and reassuring investors.
GENERATE NEW STREAMS OF REVENUES: Patented technology may be licensed to others, providing the patentee with royalty payments for sales of the patented product or process outside of the patentee’s geographical or product market. For example a patent owner may decide to pursue only one segment of the possible range of products that are covered by his or her patent and hedge the risk via licensing his technology. Additionally, patented technology may be licensed to others in a different technical field. A manufacturer may license a patent to a retailer while retaining patent rights for the manufacturing of the product.
R&D INSURANCE: Spending large amounts of money on a new technology can be risky if a technology is expensive to develop but easy to copy. Patents create a safe zone within which to make such investments. Trade Secrets and Copyrights can also help in crafting a comprehensive IP strategy.
FREEDOM TO OPERATE: If two competitors operate in the same space with similar products that are protected by patents, during a possible litigation, both parties may assert various claims against each other including patent infringement. In certain instances, the two patent owners may agree to cross license the respective patented technologies to each other instead of litigating. Without patents of its own, a company is vulnerable to patents that its competitors might use in an effort to bar it from competing.
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