UK: Mind Your Assets

Last Updated: 27 July 2009
Article by Robert Sales

Unique Concept Required

To achieve business growth there is a requirement for a viable business concept, and often for a differentiation over competitors. The business concept may be in the form of a unique idea, product or service. To maintain strong business growth may require a stream of new or improved business concepts.


Formulating new or improved business concepts can be very costly in terms of time and financial resources. This can significantly affect the existing performance of a business.

Protect your Hardwork

Having finally arrived at a new or improved business concept, no business wants that concept to be adopted by competitors who haven't incurred the hard work, expense, time and perhaps even heartache in conceiving and bringing the concept to fruition. Accordingly, it makes business sense to include as part of the process of evolving new business concepts, the consideration of what protection may be available for the concept, and any action required to obtain this protection.

Intellectual Property – What is it?

The generic term for protection which covers business ideas and concepts is intellectual property, which includes patents, designs, copyright, trade marks, brands, and domain names. Intellectual property as the name suggests, encompasses all items which have no tangible form. Such property may be in the form of ideas, concepts, reputation or goodwill.

A complex range of protection is available for intellectual property protection in the U.K. and elsewhere. The rules for protection vary from country to country, but a number of principles are widely applicable.

What protection is available free?

Some intellectual protection arises automatically, whilst other types require applications to be made to the relevant authorities. For automatic protection it is often necessary to keep original documents and also good records, so that the existence of these rights can be proved at a later date if required.

For rights obtained by registration, it is often necessary for applications to be filed before a particular event takes place, such as the first public disclosure anywhere of an idea. If appropriate applications are not filed on time, then protection may be lost for ever. In such a scenario your new business concept will have been given to your competitor without them having had to involve themselves in the hard work and heartache in devising the concept in the first instance.

Case studies – what to do and what not to do

Some examples can show how business concepts could be lost freely to competitors or could be retained to provide exclusivity and a unique selling point for a business, as well as perhaps the opportunity for additional revenue.

Example 1 – How to fork out

A company Good Fork Limited based in the South West are involved in the garden tool market. They have devised a revolutionary new fork with a simple mechanical device which aids withdrawal of the fork from the ground. Whilst designing the fork they devised a new process for moulding a semi molten polymer.

Patent Protection Sought

The correct approach was to file for patent protection for the fork configuration and also the polymer moulding technique. Patent protection was obtained for the fork and this was used to help maintain a monopoly position across Europe, and helped to enable a reasonable price to be negotiated with the "DIY Sheds". There is a potential that manufacture of the fork will be licensed to a U.S. company, to supply the North American market.

Extra Revenue

The polymer moulding process was outside Good Fork's normal field of activity. Accordingly, Good Fork contacted a large plastics company who have taken the moulding process on and developed this further. A revenue stream is now being received as a result of licensing others to use this moulding technique.

How to blow it

An alternative approach taken by their bluff M.D. was to proceed on the basis that "patents are not worth the paper they are printed on", and just get the product on the market as quickly as possible. Unfortunately, Good Fork could not get their product into the DIY Sheds, as they were undercut by their competitors Lean Forks Limited who are having the product made in China at a significantly lower price. As to an extra revenue stream from plastic moulding, that's not been remotely considered.

Example 2 – A grand design?

JD designs in the East Midlands have produced a new range of designer chairs, with a very novel shape. An eye catching pattern is screen printed onto the backs of the chair. The pattern was made by a very talented but somewhat temperamental freelance local artist. In the words of their Director Jason Dee "these designs are so original they must deserve protection by copyright", so the new chair designs were rushed to market and launched in a blaze of publicity.

Competing Designs

Shortly after launch a quite similar range of chairs was introduced by their Welsh rivals Evans Designs. Legal proceedings were launched against Evans Designs, but it appears JD Designs have quite a difficult case to win as they need to prove that Evans copied their designs. Whilst the respective designs are quite similar, it is unclear if copying actually took place, and it will certainly be difficult to prove that copying actually took place.

The designer jumps ship

To make matters worse, the original artist has been poached by Evans Designs, and now works for them. There was no written agreement between JD Designs and the artist, and it does not appear clear, in law, who actually owns the rights to the distinctive patterns.

Seek early advice

If advice had been sought in the first instance, much greater protection could have been provided by filing registered design applications, directed respectively to the shape of the chairs and also the patterns applied to them. Also, the contractual position with the artist could have been set out and confirmed in writing, before launch of the chairs.

Example 3 – A tale from the web

Textcon are a small London software house who have produced a new computer program usable by web page designers to speed up access to various parts of a website. When the program was produced it was realised that the program provides a significant step forward.

You can't patent computer programs?

The owner of Textcon had read that "you can't patent computer programs" so he took no steps to protect the clever concept behind the program. The program was named Webupspeed.

Commercial Success

The program proved very successful and a number of closely similar programs were launched by a wide range of companies, including a number of companies much larger than Textcon. The name Webupspeed proved popular and was used by most of these companies for their similar products, and this name came to describe this type of product irrespective of its origin. Textcon had therefore provided a significant advance in web page software but had perhaps not received appropriate financial reward for this.

Perhaps you can patent computer programs

If Textcon have sought expert advice prior to launching their program, it may well have been possible to seek patent protection on the basis that their program provides a "technical effect". They could also have sought to protect what was initially their trade mark webupspeed. They could then have controlled how this trade mark was used and by whom. With proper protection in place, Textcon could have realised significant amounts by obtaining a greater share of the market, and/or through licensing their product, and also licensing or perhaps franchising the product's name.

To round up

In summary, your intellectual property can protect the unique feature of your company, its services or products. Without adequate protection, the market place can soon become a level playing field, where those who do not innovate can compete equally with those who may have invested significantly in innovation.

Mind your assets

Intellectual property protection is complex, and is a rapidly changing field. Reliance should not therefore be placed on what was appropriate previously or what may have been overheard or read. Rather, it is suggested that an attempt is made to identify particular areas where protection may be of relevance, and then to seek specific advice from qualified experts in the field of intellectual property.

Beware of other's assets!

One other point to bear in mind is that competitors will have intellectual property rights, and action could be brought against you if these rights are infringed. Again, for an assessment of risk in this regard, professional advice should be sought. However, if you are copying a third party's design, product or style, it should come as no surprise you may well be infringing the intellectual property rights of that third party.


The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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