What IP means to you

How to manage your IP

As with trade in capital equipment and shares, IP must be effectively managed. With tangible property, effective management includes physical maintenance, security and record keeping. The same principles apply to managing intellectual property.

Identify and protect your IP

Specifically, IP management can be broken into:

• Evidence of ownership and rights of use;
• Security, protection and enforcement;
• Maintenance; and
• Placing IP appropriately in your corporate structure and creating the right links with other entities within your corporate structure.

Often businesses are not sure which, if any, element of IP - actual or potential (since some may require actual application) - they own. Undertaking an IP audit will help identify and protect your IP (See Conducting an IP audit).

Proof of ownership and rights of use

Evidence of an IP right arises from various sources -- IP legislation, outcomes of court cases relating to the particular branch of IP (such as patents or copyright) and agreements between the people involved in its creation and use.

Undertaking an IP Audit will also take you through the process of demonstrating proof of ownership for listed IP. This ownership can take a number of formats including timesheets for staff, letters of agreement transferring ownership to you or proof of acquisition in cases where the IP was purchased (See Conducting an IP audit).

Some IP requires you to formally apply for registration through the various bodies outlined in What IP means to you (depending on your particular type of IP).

Once you can prove you own the IP, you are in a highly privileged position where you can exploit the IP for your own commercial gain while being able to restrain others from exploiting it.

Owning IP is like owning physical property. Proof of ownership enables you to take legal action to deter would-be trespassers and obtain damages against those who have trespassed, just as the owners of physical property can do.

At any one time different IP rights may apply to a 'work' (as defined under the Copyright Act 1968), object, image or piece of information. Even though many people can own or buy copies of a book for example, only the author may have a right to receive royalties and only the publisher can licence the right to others to copy the book. For example, a publisher sells the right to reproduce a book extract for one particular magazine issue.

Checklist: proof of IP ownership and rights of use

To help prove your ownership of IP, keep a record of:

• What kind of right you have and in what form the right was created;
• What, if any, material from a third party was used in the creation process, and whether permission for such use was obtained;
• When it was created;
• Who created it;
• Evidence of ownership - such as an application for a trade mark, design or patent;
• Contracts with all parties involved in the creation of the IP which ideally clearly identifies who owns the IP;
• Log books showing how the creation process was undertaken (particularly important for IP created by employees);
• Files of early drafts and prototypes of the actual deliverables which embody intellectual property; and
• Copies of agreements with companies on whose behalf you are distributing goods or services. These should include agreements giving distributors the right to use trade marks and marketing material. This evidence should be stored in an IP Register with a backup copy in a separate location.

Managing your IP

Once ownership or a right of use in IP is proven, the next step is to develop a process for maintaining it. Without full compliance with legislative requirements, your IP rights may be inadvertently compromised, waived or allowed to lapse.

To effectively manage your IP you should:

• Establish a register listing all IP owned or used, the source of rights for use of that IP and evidence of ownership of rights of use;
• Make sure your IP is protected by registration where appropriate;
• Regularly audit the valuation and use of IP;
• Regularly review Australian and international IP registers (if relevant);
• Ensure you have confidentiality agreements in place with employees who develop, protect, commercialise or manage your IP;
• Ensure your company complies with the terms and conditions of licence agreements which grant your organisation the right to use IP belonging to others;
• Keep IP registrations current and ensure you have documents proving a chain of title ownership. This includes commission and employment agreements as well as agreements allowing others to use the product;
• Clearly identify whether a product is subject to IP protection. For example, on a web site, you should have clearly visible statements indicating ownership of the IP rights (such as copyright) and what use, if any, can be made of the material on that web site;
• Record and keep all evidence of any IP creation or transfers. This helps prove ownership;
• Record and keep all evidence of agreements allowing another person to use your IP. This proves the identity of the authorised user and scope of authorised use;
• Keep up-to-date with industry developments to make sure no one infringes your IP rights; and
• Act against all infringements of your IP rights.

The next step is to determine the value of your IP and what it contributes to your business (See Valuation of IP). Then develop a business plan that outlines the strategies you will use to benefit (See Business planning ).

Defending and enforcing your IP

There is a substantial overlap between maintaining your IP and the need to secure, enforce and protect it. Unfortunately, maintenance alone does not offer all the protection needed to maximise the use of IP. There may be times when you have to take proactive or reactive steps to defend your IP against another party who is, intentionally or inadvertently, using your IP (See  Infringement of IP rights).