IP protection best practice

Protection of IP assets builds value for sellers. Before going to market, astute sellers build the quality and level of legal protection of IP assets to at least a minimum or base level of best practice. Ideally this work should be done at least 6 to 12 months before a sale. Best practice includes use of up-to-date IP registrations and documentation. This affects copyright, trade marks, trade secrets, industrial design and patent assets.

Lower levels of protection may lead the buyer and its advisers to discount the price sought by the seller. The effective solution for a seller involves preparation of an intellectual capital register, business documentation and IP registration or codification.

Post-contract stage - services for avoiding issues

At the post-contract stage, IP is at the root of six common reasons for business failures. These can also affect franchises. Once the deal is done and the transaction finalized, buyers should be cautious of these six pitfalls.

1. Failure to address all IP issues properly or fully in the completed contract – issues keep arising after completion of the contract.
2. Failure to formally issue written assignment notices – for example the assignment of a business sale agreement, an option, a guarantee for a debt, a trade mark or patent.
3. Failure to prepare updated and comprehensive IP and domain name registers, leading to missed deadlines, lost registrations and certificates and wrong addresses on official registers.
4. Failure to act on gaps in IP protection such as those evident from a pre or post purchase partial or full IP audit.
5. Failure to appoint appropriate IP specialists to deal with IP issues such as improving the template license or terms of trade.
6. A general failure to employ best practices for IP protection, record keeping and general management after the purchase.

Failure 6 is often an outcome of a lack of alignment and integration between the businesses management, commercial, technological and legal processes and systems. This takes us full circle back to the need for pre-contract communication between different disciplines.

http://www.wipo.int/wipo_magazine/en/2008/04/article_0008.html