UK: All Businesses have Intellectual Property: Part 1

Last Updated: 16 September 2004
Article by Emma Lambert

An all too common statement made by businesses is that they ‘do not possess any intellectual property’. However, even the smallest of businesses usually owns at least four of the six key intellectual property rights (‘IPRs’), namely copyright, trade marks, domain names and know-how – failure to identify your IPRs means you may be over-looking valuable company assets.

In a three part series, Emma Lambert looks at the six IPRs: copyright; designs; trade marks; domain names; patents; and know-how. She will help you to identify which rights your business owns and suggests steps you can take to protect them – many of which are free and easy to implement.

In this first article, Emma considers copyright and designs.

Copyright

  • What is Copyright?

Copyright automatically exists for any material form that is original. This includes paintings, music, books, websites, business plans, marketing materials, business cards, client lists, page formats, databases, etc... It is highly likely that your business owns copyright in at least some of these forms.

  • Who owns Copyright?

Anyone who creates an original work will own the copyright in it with two exceptions:

Usually, if an employee creates a piece of work that contains copyright within the realms of their job description the employer will own the copyright. However, recent case law indicates that the courts are taking the circumstances of the creation of the copyright into consideration before deciding who owns it. If you are unsure who owns the copyright or in fact the IPRs generally in your business, check your employee contracts and job descriptions to ensure this is clearly set out. If you would like further clarification seek the advice of an IP specialist.

If you commission a third party to create a piece of work for you, you will not necessarily own the copyright in it – even if you pay the third party for that work. You are, however, likely to obtain a licence to use the work. If there is an intention that the work will be used AND exploited, then either a suitable licence or an assignment will be necessary and this should be clearly agreed between the creator and the commissioner. This is particularly pertinent for design-led material such as brochures and websites.

  • Who owns the Copyright in websites?

The rule for commissioned works also applies to your website. If you use a web designer to create a website, you do not necessarily own copyright in it – you may only have a licence to use them. (Remember: frequently there is more than one form of copyright in a website – software, graphics, text and audio content which were not necessarily created by the same person). Therefore, if in the future you want to change the website using the services of another designer, you would need the permission of the original designer to do that without infringing their IPRs.

It is advisable always to have a written agreement with your web designer that includes an "assignment clause" which transfers the content rights to you. In addition, it should include a perpetual licence to use the underlying software package and should allow you to sub-licence so amendments can be made. If you do not want to enter into a complex formal agreement, at the very least ask your IP specialist to draft an assignment and/or a licence as required.

  • How do you protect Copyright?

Copyright can be protected very easily. It does not need to be registered1 – simply mark your copyright material with a ©, the year the work was created and the name of the author/current copyright owner. For instance, the copyright notice on this article will read © Pictons Solicitors LLP 2004. I, as the author, am employed by Pictons Solicitors LLP and am writing this article as part of my job, so the copyright vests in Pictons and the copyright notice references Pictons Solicitors LLP not Emma Lambert.

It is also advisable to keep accurate records of all drafts of your work, date each draft and mark it with your name. If you are ever required to pursue infringers of your copyright, then you need to be able to prove that their work was copied or duplicated from yours – as well as proving that it is similar or identical.

Designs

  • What are designs?

Designs fall into two categories – registered and unregistered.

Registered Designs

A registered design is a monopoly right protecting a new design that has individual character (i.e. is not reminiscent of other designs). The design can be the shape of a product or a design as applied to a product – such as a pattern on a set of crockery. A design which is dictated by the function of the product or another product to which it is to be connected cannot be registered.

The monopoly right prevents third parties from using the design without the permission of the design owner. This applies even if the infringement is accidental – i.e. there has been no deliberate copying. This works on the basis that the proprietor’s interest is registered and so third parties are on ‘notice’ that the design is owned by someone else.

Unregistered Designs/Design Right

To gain protection an unregistered design cannot be common place and only applies to the shape of a product. Design right does not apply to surface decoration as is the case with registered designs. Again, designs dictated by their function do not have protection.

The rights of the unregistered design owner are limited – it is not a monopoly right but a right which prevents the design from being copied. In essence design right is protected in the same way as copyright.

  • Who owns a design?

The creator of a registered or unregistered design is treated as the first owner of the design. However, if the design was created within terms of employment the first owner will be the employer and if the design was commissioned the commissioner will be the first owner. Please note that this is opposite to the situation when a copyright work is commissioned. If you are not clear about who owns the rights when you have commissioned works, always seek advice from your IP specialist.

  • How do you protect designs?

You can register your designs inexpensively in the UK and in the EU. Once registered, the drawings or ‘representations’ of your design will be published and the public can access them. It is fairly easy to search for UK design registrations on the Patent Office website at www.patent.gov.uk.

In addition to registration, you can provide notice to the world of your ownership of a registered design by marking it as such. However, if your design is not registered it is a criminal offence to so claim.

Unregistered design right cannot be protected abroad, so if you intend to market your designs abroad it is strongly advisable to register them first. If you fail to register you may be able to rely on international copyright laws but it is best to register if you can. If you do not intend to register your designs use the same recordal system as for copyright – keep accurate, dated drawings of your designs and details of when the design was first marketed. In some countries it is paramount that designs are registered prior to them being marketed in order to protect them. Before entering a new product on to the market check whether you have adequate protection in that jurisdiction.

Whether you have registered or unregistered designs, it is wise to keep an eye on the market, your competitors and the trade press for new developments. If you are aware that your design has been copied then you should act immediately to obtain an injunction to stop sales, advertising and production of the copies. Delaying your response can make it much harder to prevent further infringement either by the current offending design or others – which can result in lengthy and expensive legal battles.

If you have a design you think is new, or sufficiently different to what is already on the market, instruct your IP specialist to carry out a design ‘clearance search’. A ‘clearance search’ will help you to avoid unnecessary infringement claims. Remember that owners of design rights may not be aware of your presence for sometime after you have registered a design or started marketing an unregistered design – during which you may have invested substantial time, effort and money into marketing, advertising, production, packaging, suppliers, etc… which could be wasted if you are infringing someone else’s rights.

©Pictons 2004. First published in Pictons’ "In the Know" email newsletter.

Pictons Solicitors LLP is regulated by the Law Society. The information in this article is correct at the time of publication in May 2004. Every care is taken in the preparation of this Article. However, no responsibility can be accepted to any person who acts on the basis of information contained in it. You are recommended to obtain specific

1. Copyright registration is required in a very small number of countries. If countries outside the UK are of particular interest, check the position relating to copyright before marketing or selling the copyright work there.

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This article is part of a series: Click All Businesses have Intellectual Property: Part 2 for the next article.
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