What's New in IP and Brand Management
July 2007 Issue A
Greetings!
Hope you find the information within this newsletter informative. For any further information regarding any of the topics covered please contact us.
Sincerely,
Avaneesh Marwaha
In THIS ISSUE:
The Value of Intellectual Property
Costs of Intellectual Property Litigation
Brand Importance
The Value of Intellectual Property
The most important asset to a company is often the one that is of least importance. Developing a strong and diverse portfolio of intellectual property is important in maintaining a strong market value. Intangible assests such as patents, trademarks, copyrights and trade secrets account for more than half of the value of a company that has spent the time and the money in developing and marketing.
In a recent study conducted by PricewaterhouseCoopers, researchers found that "despite an overwhelming view of the importance of IP, over two–thirds of executives believe their IP management is too often treated as a legal issue". Although IP does originate in the legal field when companies seek protection of their valued assets, often times this is where companies stop and refrain from exploiting the possibilities.
So what can companies and executives do to maximize their IP assets after seeking the initial legal protection:
- Create a closer link between their IP and their marketing strategy.
- Spend the dollars on branding their IP to the company and its good or service.
- Use their IP in a consistent manner and under the guidance of both marketing and legal.
- Seek opportunities to exploit their IP through licensing agreements.
- Protect their IP from potential infringers.
- Treat the IP as an actual asset and part of their portfolio – time and money should be spent continuing to develop and stregthen the portfolio.
- Make sure to keep up with the market place and adapt the IP to fit within the new arena.
Many companies understand the value of obtaining a patent, trademark or copyright by very few understand the value of exploiting their IP through structured branding and licensing efforts.
To get more information on obtaining IP protection or exploiting IP contact Marwaha Law Office, LLC.
Costs of Intellectual Property Litigation
If you add up all the various property crimes in the country, everything from theft to fraud, to burglary, bank robbing, all of it costs the country nearly $16 billion a year. However, if you add up the costs for all of the intellectual property crimes it runs in the hundreds of billions a years.
Why the big difference? Because "[i]ntellectual property theft is seen as a low–risk, high–reward crime in America..."as Tom Donohue, President and CEO of the U.S. Chamber of Commerce ("COC"), recently stated.
This disparity between property crimes and intellectual property crimes is due to the current remedies available through law enforcement and the courts. Recently the COC and the Coalition Against Counterfeiting and Piracy ("CACP") announcend an agenda to convince Congress and the White House to change the enforcement of U.S. intellectual property rights laws.
The agenda outlines six goals:
- 1. increasing government resources;
- 2. strengthen enforcement at borders;
- 3. tougher penalties;
- 4. improving federal govt. coordination;
- 5. reforming civil and judicial process; and
- 6. educating consumers.
Even if a company follows the requirements necassary for achieving IP protection, they may not be able to recover their losses. Why? Because according the American Intellectual Property Law Association, the average litigation cost through appeal of a patent case is about $2,000,000, a trademark case is about $700,000, a copyright case is about $440,000 and a trade secret case is about $1,000,000. These costs often limit and restrict the amount of time, money and other resources a company can devote to litigation.
What does this mean for the corporate world? It means that even if you follow the appropriate procedure for achieving IP protection your company may not have the recourse or remedy available to recover any losses. The problem will continue to increase because there is an increase of patent (8.3% in 2006) and trademark (31% in 2006) applications filed with United States Patent and Trademark Office. This increase will directly result in an increase of IP theft and litigation.
It is important that companies, especially small businesses that rely on their IP as the majority of their assets, have strong non-disclosure agreements, licensing agreements and business stream agreements to protect their IP rights.
To find out more on IP protection, non-disclosure agreements and licensing please contact Marwaha Law Office, LLC.
Brand Importance
A successful brand is one that increases the perceived value of the product in the eye of the consumer. The brand provides a consistent value and association to the good or service. For example the brands Sony, Toshiba and Nike give an image in the consumers mind and the consumer expects a level of quality solely associated with that brand name. Now, right or wrong, a different preception is had with the following brands Aldi, Advent and Converse. Although these are successful brands consumers expect a different level of quality from these products.
It is important to understand that a well-leveraged and developed brand will result in a higher return than one that is narrow. Meaning the stronger the brand the greater returns for the shareholders.
So what goes into a brand?
- a protectable name (a trademark);
- a name that is rememberable;
- association between the name and the good or service; and
- a name that distinguishes itself from the competition.
After creating a brand what makes it successful? Strong marketing and association between the name, the product and the expectations of the product. Companies must understand that the way they and their representatives use their brand names and trademarks is important to the overall value of the company and therefore must protect this asset.
The brands value is determined by the overall profit the company realizes directly from the brand. The more resources and planning put into the brand the great the profits and overall value of the brand. Therefore as the value increases so does the potential of profits from exploiting the brand, i.e. higher licensing fees that a company can charge distributors and representatives to use their brand.
Therefore brand developement and management should be on the top priority of businesses, especially small businesses looking to make money by licensing their brands to larger business.
To find out more about brand development and management contact Marwaha Law Office, LLC.
No Legal Advice or Attorney-Client Relationship: These materials have been prepared by Marwaha Law Office, LLC for informational purposes and are not legal advice. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. You should not act upon this information without seeking advice from a lawyer licensed in your own state or country. Do not send us confidential information until you speak with one of our attorneys and receive our authorization to send that information to us.
Copyright 2007 Marwaha Law Office LLC.
