Is It Always Right To Simply Protect Your Intellectual Property?

May 14, 2015

IP lawyers take it as read that if you can, then you will always register your intellectual property rights – be they patents, designs or trade marks. The logic goes like this…

Take something novel and stop everyone else from using it, apart from you, and make lots of money!

However, this type of absolute protectionism isn’t always a good business model. And here’s the commercial angle. In 1936 Kodak® started to produce 35mm film and having protected it, they started to make a considerable sum in selling chemicals to process and develop film. However, in 1975 Kodak’s® engineer Steve Sasson invented the digital camera. (Yes – 1975 the first digital camera!). “Yikes” went the management, “that’s a great idea but it will adversely affect our business. Let’s suppress it now”. They did however, patent the technology. In fact Kodak® went onto file around 1000 patents on digital imaging.

In suppressing the technology, Kodak® then started to watch their business unravel. You see as Zig Ziglar said, “people don’t buy drills they buy holes”. In suppressing the technology, they made a short term gain but a much longer term loss, and in 1999, after the first digital camera patents were expiring, their competitors leapt ahead of Kodak®, smashing Kodak’s® share price and forcing Kodak® to drastically cut jobs and costs just to survive. Customers buy photos, not chemicals and film. Had Kodak® licensed out their technology well before they did, they would have shared the technology, been market leaders and maintained their share price. You see digital images were what we now call disruptive technology. (See my blog on this topic.)

The problem is that some companies are TOO protective of their ideas. Many years ago Tetra Pak® made a similar mistake by forcing customers to buy both machines AND packaging directly from them rather than licensing the technology out. After a short space of time the European Court stopped this anti competitive practice which tied buying one product to another. Tetra Pak® then made up the difference in sales by licensing their technology out and building a World Wide network of licensees. Ironically this latter strategy gave them instant market presence in a number of places that they’d never done business in before.

A major issue is that companies get SO tied up in protecting what they make, that they forget about their customers and why their customers buy products. Whilst intellectual property exists to create a barrier to being copied, the most intelligent use of IP comes when it is licensed out and monetized to make an income stream. Syndicate and recycle are two useful mantras.

So the question to ask yourself is this. How can I use my IP to create an income stream and what do I need to do to get it out there and shared in an intelligent way? We’d be happy to help you make that judgement call!

A Big Well Done!

 

Congratulations to all our hard working colleagues at Virtuoso Legal. We’ve been short listed in the Lawyer Awards 2015 for “Boutique Law Firm.” The results will be revealed on 23 June. In the meantime, keep your fingers crossed for us!

 

Virtuoso Legal are specialist Intellectual Property Advisors.  Because our expertise and commercial acumen are second to none we are an Award-Winning Team.  Our reputation as one of the UK’s leading Intellectual Property Practices is built upon delivering the highest quality work for our clients.  If you need any help or advice on any Intellectual Property matters then give us a call on 0113 4032102 and we provide a free consultation.



Dr Nikola Tesla and the Death Ray Machine…

March 3, 2015

Tesla is widely credited with inventing AC or alternating current, and of course wiping the floor with Thomas Edison’s direct current or DC as a general power source.

In fact he didn’t invent AC – it had been around for a few years before Tesla got his hands on it. However, Tesla’s genius led to the creation of the induction motor and transformer which amplified the availability of power and voltage in particular. George Westinghouse licensed Tesla’s patents and the rest as they say is history. Westinghouse is still a World class utility provider.

Tesla was a prolific inventor. He is credited with over 112 patents, filed in 25 different countries. Some of his other inventions include the largest ever magnifying transmitter coil which produced lightening bolts over 100m long! Can you imagine that on Top Gear or in physics lessons?

He was also credited with producing Tesla turbines which used discs rather than blades to propel liquids, wireless lighting, extra terrestrial radio transmitters and an “ideal flying machine.” The ideal flying machine and the work on the death ray machine are still classified documents in the US. Some say the US Government didn’t really take any notice of Tesla until he attempted to publicise his work on these devices. Whatever the truth of the matter, we can’t read his work on these inventions.

He was also way ahead of his time in other ways. Especially with his Tesla Shield – an electromagnetic shell that repelled radio waves or electromagnetic forces and kept material within the shield totally protected. The Tesla Shields still have military and civilian applications. His talents didn’t stop there. He patented a solar powered “sun motor” and an amplifier of mechanical power, i.e. a mechanical rather than an electrical invention. He was surely one of the most awesome inventors ever.

Which makes me wonder if we do enough in the UK to really help our inventors?

In the IP World I’m a big supporter of tax breaks for technology companies. We invent things, and it is only right that we support companies who manufacture and do R&D here.

It is with some sadness then that I found out that applications to the Patent Box Scheme must end for new applications before the end of 2016. The scheme itself runs until 2021. There is some suggestion that a new scheme will be introduced for patents after 2016, but the odds are that it will be less generous than the existing scheme. So the message is simple; get your inventions in now, and apply for this tax relief in good time!

If we want the next Westinghouse or Tesla in the UK, we need to support them in whatever way we can!

If you would like any advice on inventions or tax relief, give one of our team a call for a no obligation chat on 0113 4032102 or email us!


Innocent Until Proven Guilty?…

February 26, 2015

One of the biggest problems we see as IP Specialists is disputes over ownership. These rarely go all the way to Court, but in the case of Innocent Drinks and the “dude” logo, the stakes were high and the matter did!

Intellectual property is often termed a monopoly right by lawyers. In practice this means winner takes all! You either own it and control it or you don’t. In between ownership and use, there is a raft of commercial possibilities – and elephant traps. One of which Innocent and their brand creators Deepend fell into.

Back in 1999, a design agency called Deepend created the well known “dude” logo for the then start up Innocent Drinks company – now known as Fresh Trading Limited.

Deepend and Innocent did a deal – without lawyers. They agreed in unsigned heads of terms that Deepend would create the branding and design for Innocent, and Innocent would allot them shares in the start up company. Deepend created the brilliant bottle logo design we’re all so familiar with…

Innocent never gave them shares. No contract was signed.

Let’s fast forward here 15 years, and Innocent drinks have of course become outstandingly successful – no doubt in part measure because of their branding. Deepend would have liked some kind of shares or payment but none has been forth-coming. And thanks to a recent High Court decision, Innocent now own the copyright to the logo, but Deepend haven’t and won’t be paid. (Subject to an appeal of course!).

A Lesson To Be Learnt?

The lesson is this – mere promises ARE NOT enforceable! Harsh but true. The directors or employees you are now in business with may not always see things as you do. People fall out and move on. If you are a supplier, make sure you will get paid by using a properly drafted contract. If you are a director or shareholder make sure the company has control over its intangible assets. There are few certainties in life but one that we see regularly is that if it is of value then people will fall out about it and getting clear contracts in place is often money invested against future disputes.

If you have any concerns about disputes over ownership, give one of our team a call for a no obligation chat on 0113 4032102 or email us!


‘e’ by gum I’m confused!… Brand owners beware!

February 26, 2015

Of all the phone calls we receive, the unhappy ones are usually from brand owners who’ve been copied…

Sometimes the offender is a “looky likey” product but often an entire brand name or logo has been copied, if not slavishly, then in a way that is very confusing for the consumer. So it was of interest this week when I read about Enterprise Holdings Inc slogging it out against Europcar Group UK Limited over the use of ‘e’ as part of their car hire brand, and the obvious confusion that followed.

I won’t go into the legal details of this case, suffice to observe that both sides appeared to run every allegation and defence with great vigour. It is worth mentioning that his Honour Justice Arnold noted that both parties treated the dispute “as if it were a state trial.”

The vehicle hire market in the UK is big. Indeed the UK is the second largest hire market after Germany. The market is dominated by Enterprise, Europcar, Avis, Hertz and Sixt. Most bookings are made in advance via websites and intermediaries. The rest are done on the spot or by telephone. A highly relevant factor in this case in relation to customer confusion, was the transnational character of customers. In simple terms, many customers spoke limited or no English. Bear with me on this point; it is important, especially at airport car hire desks!

Jack Taylor the founder of Enterprise in the USA started using an ‘e’ logo in 1967. This has since morphed into the stylised ‘e’ seen below.

5cf3795a-fd8a-4ef6-a153-f27a60e7a77f

From 2006, green was also used with black and white as part of their livery.
Enterprise started in the UK in 1994, and quickly spread through Europe. It now has extensive presence throughout and franchise arrangements in 14 EU states. The ‘e’ logo has been extensively used by them on signage and also on airport buses, car rear bumpers and the homepage of their website. Naturally the ‘e’ is a registered trade mark. As are a number of variations of it.

Europcar started in Paris in 1949 and used a simple ‘e’ type logo from 1965. It then moved to Europcar as a word mark and in 1988 developed a green and white colour scheme, which it now uses extensively. Europcar has extensive Worldwide coverage, but has little market share in the USA. The two now compete for #1 slot of market share. In 2012, after a consumer studies and a brand re-vamp, Europcar became:

9d99c2f6-9d4c-4f11-86eb-b9a2c4f89aa7

The digital age had arrived and was encapsulated by Europcar’s moving ‘e’ logo which was then used on the website, as signage on vehicles and as a phone application etc.

The problem that arose was that from its introduction in 2012, passengers queued in droves for the wrong car hire buses at airports! Europcar customers queued at the Enterprise car desks for car hire and vice versa. The nub of the problem here is that infact consumers have imperfect recollection of any trade mark!

In order for a brand to be truly distinctive, it needs to set one business apart from another. Imitating someone else’s mark, either knowingly or unknowingly does NOT make commercial sense for either party, and can lead to significant reputational damage. Whilst we understand that both companies had a history of using a prominent ‘e’ as part of their mark it doesn’t take a genius to work out that the public were likely to be confused by Europcar’s new identity, especially if they didn’t speak the local language.

This matter also illustrates the importance of getting specialist legal advice when re-branding and getting proper trade mark clearance searches done BEFORE launching a new brand.

Also beware of the digital space – this kind of short hand brand look needs careful thought!

We are totally baffled by Europcar’s stance on this.  Apart from any consideration of trade mark infringement, making a brand distinctive is of paramount importance.  This is often done with distinctive logos which then transcend language barriers.

Enterprise won the High Court battle – at great cost – but common sense should have prevailed well before then!

If this is something that concerns you, or you need any intellectual property legal assistance, give one of our team a call for a no obligation chat on 0113 4032102 or email us!


Kim Highley – TOP ETAIL TIPS to stay safe and shop happy online this Christmas

December 19, 2014

IMG_9831

How much of your shopping was done online this year?

Check out this latest newsletter by Kim Highley to make sure you know your rights and keep yourself safe online over the holiday period.

We suspect that like 50% of UK Citizens this year, you will have used the internet to buy more than half of your Christmas presents.  This figure is at an all-time high and whilst online shopping offers so many advantages, there are also risks in the form of e-crime and online fraud which we should all keep in mind.

So why has the online shopping revolution really picked up pace this year?  Many analysts in the Etail sector believe it is thanks to the development of easy to use apps for smartphones and tablet computers.  Add in to the equation enticing offers from major retailers, not just on Black Friday and Cyber Monday but all season.  For example, Amazon, Marks and Spencer, Currys and Asos have offered as much as 70% off some of their lines this month.  With such high demand and enticement it is hardly surprising that some websites have gone down with technical difficulties.

We set out below some crucial golden tips for your next digital purchases, whether these are for last minute presents or the January sale items.

Download it Here – Top Etail Tips to stay safe and shop happy online this christmas by Kim Highley


Even The Big Boys Get It Wrong In China…

December 10, 2014

made-in-china

Things regularly go wrong at trade shows. The usual phone call we get is either just before or just as the first day of the trade show opens and lo and behold some copy product is launched to an unsuspecting public!

If you are doing this then do be aware that in some European countries, the law will CLOSE YOU DOWN and ask the questions later…France springs to mind. Two directors I know of spent an uncomfortable 2 nights in a German prison at the start of one trade show. Even in the UK it isn’t unheard of for lawyers to serve Court Orders at trade shows, and then have goods seized or removed from sale. However, in the UK we normally reserve prison only in the case of contempt of Court if you don’t comply with a Court Order.

Chinese Car Manufacturer Copies Range Rover Evoque…

Pity poor old Land Rover this week in China at the Guangzhou Motor Show, when a local car manufacturer launched a £14,000 copy of their prestigious Range Rover Evoque. The Evoque is sold in China at around £40,000 and is made by a Chinese Joint Venture company comprised of Jaguar Land Rover and Chinese company Chery. What is sad about this situation is that such copying can actually destroy jobs in China and this behaviour makes even the big companies think twice about expensive JV’s with local companies and serious investment in an emerging economy.

Whilst no doubt Jaguar Land Rover’s IP experts are now crawling over the details of the design of the car and will undertake serious analysis of what is an identical component and what is simply over borrowed, this isn’t the first time the manufacturers LandWind have copied a European car. A few years ago LandWind launched a copy Vauxhall Frontera. This model was briefly sold in Europe until crash test failures forced its withdrawal from sale in European countries.

In order to succeed in China and through the local Courts, Land Rover will have to prove slavish copying of their design. This may deter them from taking action in China. Where there has been slavish copying the Chinese will close a factory down. However, I suspect LandWind have been too clever to get caught by that trap and have designed around any direct copy but have used the “look” of the Evoque to capture the bottom end of the car market in the Far East.

All of which goes to show that even the big names with all their resources can be copied in China. It’s a crying shame. It is far easier to copy than to innovate.

However, one thing the big companies will have in their favour is that they will have registered their brand as a trade mark. At the end of the day the LandWind car won’t ever have the Land Rover brand name on it, and its sales will be limited simply by virtue of the lack of brand awareness.

There’s a lesson here. If you want to export ALWAYS register your trade mark first!