Intellectual Property

By Chris Russel

Customer and community benefit are the drivers for innovation and change.  But reward - commercial advantage - is the basis upon which business sustains and resources its innovation efforts.  Business vitality is assured by the introduction of innovations and their further development.

Business advantage depends on:

• the element of surprise,
• uniqueness of the innovation,
• the degree of development before the innovation goes public - time,
• being first and doing it better.

For these same reasons new ideas appeal to our competitors and others.  If they get early warning, advantage is lost.  If they are quick or if the idea becomes widely known, then the chances of legally protecting it or gaining advantage from it are significantly reduced or gone.  The lesson is to establish protocols at the start of a good idea to keep the idea well shared but secure; to protect design as early as practicable, and to establish clear understandings and agreements regarding sharing and disclosure at every step and particularly with external contacts. Included in this background info is basic information on the following:

• Intellectual property in Australia.
• Protection of intellectual property.
• Protection of intellectual property in the electronics industry.

Intellectual Property in Australia
Do not give away your most valuable asset.  Businesses built on innovation and design need to protect their intellectual property rights.  If you do not have the necessary strategies in place to protect your intellectual property, early disclosure of your creative ideas, inventions and designs can put your business at risk.  Intellectual property represents the property of your mind or intellect. In business terms, this means your proprietary knowledge.  If you fail to develop appropriate strategies before you make this knowledge public, you could lose your legal right to patent your ownership of an innovative product.  

• Patents are for inventions, i.e., for a new or improved product or process.
• Trade marks are for words, symbols, pictures, sounds, smells or a combination of these and they distinguish the goods and services of one trader from those of another.
• Designs are for the shape or appearance of manufactured goods.
• Plant breeder's rights are for new plant varieties.
• Circuit layout rights are for three-dimensional configuration of electronic circuits in integrated circuit products or layout designs.
• Trade secrets include know-how and other confidential information.
• Copyrights are for original material in literary, artistic, dramatic or musical works, films broadcasts, multimedia and computer programs.

In Australia, patents, trade marks, designs and copyright have been Commonwealth functions since Federation. Some intellectual property rights are automatic and some are only granted after application and successful examination. IP Australia [http://www.ipaustralia.gov.au/ ] administers patents, trade marks and design rights with an examination and registration process.  Attorney-General's Department administers the legislation for automatic rights to copyright and circuit layout rights. Plant Breeder's Rights Australia, Department of Primary Industries and Energy administers the plant breeder's rights which also has a registration and examination process. Other legislation affecting intellectual property includes trade practices. You can take legal action under common law for infringement of trade secrets, passing off trade marks and confidentiality agreements.

Patents are granted for inventions and give the owner the exclusive right to exploit the invention and to authorise others to exploit the invention. A patent lasts for up to twenty years.

Trade marks distinguish the goods or services of one trader from those of other traders. A trade mark can be a valuable marketing tool for businesses as it can symbolise a certain image, quality and reputation for its owner. Registration of a trade mark gives the owner the exclusive right to use the trade mark on the goods or services for which it is registered and may be renewed indefinitely.

Designs refer to the features of shape, configuration, pattern or ornamentation which can be judged by the eye in finished articles. A new or original design may be registered for up to sixteen years. Registration gives the owner the exclusive rights to make, use and sell articles incorporating the registered design.

IP Australia incorporates the Patent, Trade Mark and Designs Offices which administer the Patents Act 1990, the Trade Marks Act 1995, the Designs Act 1906 and associated regulations as well as the Olympic Insignia Protection Act 1987 and the Scout Association Act 1924.

Selected decisions of the Commissioner of Patents or the Registrars of Trade Marks and Designs are published by Butterworths in their Intellectual Property Reports (IPR) and by CCH in Australian Intellectual Property Cases (AIPC). Selected patent and design decisions are also available on the AUSTLII Law Site. IP Australia can supply copies of most written decisions. IP Australia also publishes a quarterly CD-ROM with full text patent and design decisions from 1983 and an index to decision published in the Official Journal from 1904.

Adapted from material found at http://www.ipaustralia.gov.au/intell/ipsintro.htm.

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Intellectual property in general
According to Sixbey and Costellia (1996) [http://www.sixbey.com/ ],  the protection of intellectual property begins with the following steps:  

• Keep written records for each project.  Written records for each development project undertaken are invaluable in the event a controversy arises regarding inventorship or ownership of intellectual property. Complete records showing that a company independently developed material in controversy will often conclusively terminate any claim of alleged prior inventorship or misappropriation.

• Designate someone to record project developments.  Because most engineers and inventors hate to take time away from engineering and invention development projects to keep records, some person in a company should be given the designated task of ensuring that the developments made during each project are recorded. A notebook should be kept which includes a written record of the daily activities of each person contributing to research, development, and testing of a product or method involved in the project. It is critical to show that a continuing development effort occurred during the term of the project.

• Return unsolicited idea submissions.  A company should beware of the unsolicited submission of ideas by persons outside the company. Unsolicited submissions should be returned and not considered until the submitting party signs an agreement relinquishing all rights other than patent rights in the submitted material.

• Limit access to research and development facilities.  All areas of a facility where research and development is taking place should be "off limits" to persons who are not employees. Persons not employed by a company who are permitted into these areas should sign an agreement to maintain in confidence anything which they learn, and a log should be kept showing the name, address and business affiliation of each such person, the date of entry, the time of entry and the time of departure.

• Require employment contracts.  All personnel hired to engage in research and development should be required to sign an employment contract which defines their responsibilities relative to intellectual property developed during their term of employment, including the responsibility to assign all rights to their employer in consideration for their employment.

• Screen potential employees carefully, especially those previously employed by a competitor.  When hiring people for research and development work who were previously employed in a similar capacity by a competitor, it is important to investigate the terms of any employment agreement which they had with the competitor and then care should be taken to assign them tasks which do not involve use of confidential information developed while they were with the competitor. Failure to carefully screen potential employees known to have worked for a competitor can expose the company to litigation for misappropriation of the competitor's proprietary information.

• Inform management and legal counsellors of project developments.  To provide adequate protection for company intellectual property, and to minimise the likelihood of intellectual property litigation by competitors, it is important "for the right hand to know what the left hand is doing". Someone who can understand the engineering developments and research under way in the engineering section of the company should be given the task of constantly monitoring development progress and providing information to management personnel and to the company intellectual property counsel.

• Determine which features should be patented.  Prior to the announcement of a new product, management and engineering personnel, sales personnel and legal counsel should determine what features of the product should be protected. A schedule can be formulated for completing applications for patent protection to ensure that premature disclosures of the product, which will destroy foreign patent rights, do not occur.

Conclusion: Valuable intellectual property rights may be lost by actions carelessly, but innocently, taken by the engineering and marketing personnel of a company.  Consequently, internal standardised policies which are adopted and followed can prevent a disastrous loss.

Adapted from material found at : www.sixbey.com/claart.htm.
Protecting Intellectual Property by Daniel W. Sixbey and Jeffrey L. Costellia (1996).  CLA Advantage, March.

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Intellectual property in the electronics industry
According to Kate Wilson, a partner at James & Wells Patent Attorneys in New Zealand [http://www.jaws.co.nz/ ], protecting the intellectual property in a new electronics design can be a nightmare - both for the designer and for the Patent Attorney. There are a number of unique factors in the electronics industry which at first glance make the developers highly doubtful that any valid patent protection can be gained for the new design. Some of these factors are listed below:  

• Problems are solved in one field by incorporating circuitry already known and used in another field.
• Technology in the electronic industry advances so rapidly that any patent could be valueless in a short period of time.
• Hardware is rapidly being replaced by software which is perceived as unpatentable.
• New control applications do not involve the use of new componentry or design, but just new instruction.

Asking the right questions can determine the validity of the above factors:  

•  In using known circuitry from another field for a new situation, did you have to adapt that circuitry to work within that new situation? Typically the new situation requires that you adapt known circuitry to that application. For example, the new situation may have additional filtering requirements, more adverse environmental conditions, a requirement to be more user friendly and so forth. The circuitry itself may not be adapted but a specialised interface may be required to incorporate the existing circuitry into the new situation. These adaptations or the interface may well be patentable features. Further, if these adaptations are necessary for the product to perform well, then a patent for the adaptations may be valuable.

• Have you had any difficulties in arriving at your final design? Electronic engineers can be self effacing and quite often put down their design efforts. However, patentable features can be determined by examining the difficulties overcome during the design process. How these difficulties are overcome is generally the patentable feature.

• Is there an overall concept independent of the actual technology implementing the concept? Patents are for novel concepts and in general are not restricted to just one particular form in which that concept is implemented. For example, your new design may incorporate a thyristor as a switch. In years to come the thyristor may be phased out in favour of other switching devices. Thus, the original technology may be obsolete. However, the patent would have been written up to protect the concept with any switching device. Thus, the patent may still be valuable despite the change in technology.

• Although your new invention uses mainly software instead of hardware, is there still a novel concept associated with that software? Software is patentable in New Zealand (and in some other countries) if there is a novel concept associated with that software. Patent law is moving to the view that it is immaterial whether the concept is implemented by hardware or software - merely that the concept is novel.

• Does your new process have a commercial advantage over previous processes? New processes are patentable, even if they involve existing hardware and produce a known product. If you have a new process which you believe will provide a commercial advantage, we will need to look at what steps in that process give that advantage. If we can define in writing these new steps or a new combination of old steps, then this is patentable subject matter.

Conclusion:  If you have designed something which could be commercially valuable, then you owe it to yourself to determine if you can protect this valuable property. See your Patent Attorney who should give general advice on protectability free of charge. From assessing the answers to the foregoing questions (and others!) you should be able to work out whether your innovation is something which can be patented. If not patentable, then you should look at other types of protection.

Adapted from material found at http://www.avnet.com.au/Edge/edgq2961.htm

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