Protecting your social enterprise’s intellectual property
Intellectual Property’ is ‘the application of the mind to develop something new or original’
‘property’- just like other property, it can be owned, sold and transferred, leased or given away.
Types of intellectual property include:
patents (for new or improved products and services)
trade marks (for logos and brands)
registered designs (for the shape or appearance of a product)
plant breeder’s rights (for new plant varieties)
copyright (including software, databases, and other copyright works)
circuit layout design rights
Confidential Information – trade secrets, know how (including client lists, specifications, strategic and marketing plans).
What is Copyright?
Copyright is free and applies automatically when the work is created.
There is no registration system for copyright in Australia.
Copyright does not protect ideas, information, styles or techniques, names, titles or slogans.
There is no general exemptions from copyright law for not for profit organisations
Copyright – what does it protect?
Literary works – eg. reports, journal articles, books
Artistic, dramatic and musical works
Cinematograph films – eg visual images and scripts (separately) in a film, video or DVD
Broadcasts – eg TV and radio broadcasters
Published editions – publishers
Copyright – who owns it?
Employees, created in course of employment: Owner – employer
Freelance photographers, engravers and people doing portraits: Owner – the freelance creator
Commissioned work – person who commissioned work, has right to use for purpose commissioned but not ownership unless alter by agreement
Films: Owner – Producer or person who paid for it to be made
Recordings: Owner – person who paid for it to be made
Some cases – performers recorded on sound recordings own a share
Works created for State, Territory or Federal Government: Owner – relevant State, Territory or Federal Government material created, or first published by it or under its direction or control
HOWEVER, any rules can be altered by agreement.
Copyright and Moral Rights
Individual creators have moral rights, whether or not they own copyright.
These are the rights to:
Be attributed as the creator of the work
Take action if their work is falsely attributed as being someone else’s work
Take action if the work is distorted or treated in a way that is prejudicial to their honour or reputation
What are a non for profit organisations ‘trade secrets’? Not generally known and developed through expenditure of time, effort. Trade secrets give a competitive advantage. Adequate steps are taken to maintain secrecy.
How to find them.
Talk to the right people. This would include: marketing people, service providers, research and development, computer programmers/managers, operational managers/supervisors
Ask the right questions. What would you not want your competitors to know? and why?
Then examine whether the necessary elements of trade secrets are present.
Where did the information come from?
Is it known by others?
Has any source code been disclosed outside the NFP?
Is any new product information, specifications sent out to service providers/clients/customers?
Is there an employee who could hurt the NFP by leaving to go to a competitor or set up on their own? How could he/she hurt the NFP?
Where to look
Bargaining tool – can be licensed or sold for financial gain – further NFPs objectives
Enables NFP to compete on the basis of the reputation associated with a product
Gives right to determine who can use the IP and how it can be used
Increases options if cannot afford to commercialise IP or position in market
IP can be used many times without being diminished – eg different licences based on geographical regions
IP laws reduce products and/or services being replicated and passed off
Opens new opportunities
Open opportunities for strategic partnerships
Improves operational, financial performance
Improves risk management
Top ten tips on protecting IP
Tip # 1 – Educate
Educate yourself and team on the basics of trademarks, copyrights, patent and trade secrets
Tip # 2 – Conduct an IP Audit
Defined: A systematic review of the IP assets owned, used or acquired by the NFP.
Purpose: uncover under-utilised IP assets, identify any threats to the NFP, enables Board/ management to devise informed strategies that will maintain and improve the NFP’s position
1. Identify readily identifiable IP – internal assets
Registered trademarks, copyrights, designs or patents owned by the NFP
Licenses in (eg. domain names), licenses out, include cross-licenses
In-house work manuals, publications, training, databases, recipes/ formulations
Trade secrets, know-how or confidential information
2. Identify external IP assets
NFP Brands, product brands,
goodwill, client loyalty
product certification, regulatory approvals
distribution contracts and networks, client lists
marketing and advertising programs
3. Assess what the NFPs legal rights are in relation to each item of IP identified Ascertain:
Whether the NFP owns the IP – see Questionnaire
If the NFP does not own it, whether the NFP has adequate rights over it
whether there are any restrictions affecting the NFPs ability to freely use the IP, such as joint ownership
- Developed it in the course of the NFPs activities, by the NFPs’ employees and contractors?
- Developed by an associated NFP legal entity?
- Developed by another person or organisation and
- sold or transferred to the NFP
- sold or transferred to an associated NFP legal entity
- licensed to the NFP
- licensed to an associated NFP legal entity?
- It is something that was learnt from publicly available resources?
- It is something that was developed jointly with another person or organisation?
4. Understand what value/ advantage these rights give you
A good question to ask is how much will it cost to replace the item if it were lost, what is the expect income?
Tip # 3 Develop an IP Strategy
Consider ways you can use the IP system in your strategy
Integrate IP into your strategic plan/ business plan
Search databases and internet to ensure ideas are new and to avoid infringing others
Weigh the risks of registered vs unregistered rights
Tip #4 – Register your IP
Tip # 5 Ensure the NFP owns or has right to use
Employees – contracts
Ensure scope of employment clearly defined
Ensure obligations of confidentiality clearly articulated – sign non-disclosure
efined ‘intellectual property’ and ‘confidential information’
Similar to employee, but also:
Rights must be transferred to NFP
Must be in writing signed by Contractor (creator)
[NAME OF CONTRACTOR] hereby assigns and agrees to assign to [NAME OF YOUR NFP] all right, title and interest in and to the [NAME OF THE WORK] and all intellectual property rights therein.
A non-disclosure agreement does not transfer IP
For contracts to develop computer software – ensure source code assigned
Ownership by a 3rd party
Ensure the NFP has the right to use the IP for its purpose
3rd part grants the NFP a licence to use the IP for [insert purpose]
Licence for NFP only, if need for other parties then need a ‘sub-licence’
If restrictions on use – must comply and must ensure sub-licensees comply
If head agreement, must not breach
Tip # 6 – use confidentiality/ non-disclosure agreements
Examine existing confidentiality/non-disclosure agreements
Be sure that appropriate confidentiality agreements are in place with third parties to protect trade secret information that must be released outside the NFP
Tip # 7 – Document licences and approvals to third parties
Have a documented system for granting licences and approvals to third parties and personnel responsible for implementing the system.
This allows the not for profit organisation to prove that an infringer did not have permission or consent to use IP.
Tip #8 – Protect your IP Internally
Implement a document management system
Educate employees about the risks and ramifications associated with unauthorised removal of IP
Implement sufficient IT security policies – use of storage devices, such as thumb drives and external hard drives
Implement an email monitoring system
Implementing appropriate internet security measures – eg webmail such as hotmail
Adopt a process of review when employees at or above a certain level
Tip # 9 Protect your IP online
As the stakeholder reach expands the NFP IP become more valuable – it then can be infringed by users anywhere in the world
Protect by taking measures to discourage misuse
Include section on website that specifically states terms and conditions for use of the NFPs material
Acknowledge IP the NFP uses by does not own
Use tools such as ‘watermark’ an image, identify copyright owners, its country of original and permitted uses
Use disclaimers as commencement of each section, or link to disclaimers
Tip # 10 Develop an infringement strategy
It involves a strategic assessment of your IP rights and setting parameters for beginning (and ending) infringement action.
Seek advise of your lawyer
Develop an infringement strategy that suits your NFPs needs and resources. Such a strategy should include:
Identification and awareness – identify, educate, record details
Proactive measures – eg software access codes or passwords
Detection methods – eg periodic review
Budgets for infringement action