Intellectual Property Claims Overview

Intellectual property claims are legal actions brought by one party against another when a party feels its intellectual property (IP) rights have been infringed upon. Because many companies consider their IP to be their most valuable asset, they can often move aggressively to protect it if they feel an infringement has occurred. Thus, if you find yourself defending against an IP claim, significant defense-related costs can be incurred and all with the prospect of a judgment, which may be even more costly. Therefore, it is important to be aware of what may constitute an infringement that could bring on an IP claim.

Common Intellectual Property Misconceptions

IP law can be a complex and confusing topic, and in the face of it, many prefer to assume that what “feels right” is, in fact, the law. This, of course, is not true, and making such an assumption could be costly. The following are just some of the common misconceptions people have when considering intellectual property:

  1. Large companies enforce their trademark just to bully smaller companies. Large companies enforce their trademark because it is their right to protect an IP that they own. Also, if they do not enforce their trademark, they risk losing it. Trademarks are designed to distinguish one service or product from another. If many different entities are using the same trademarked asset, then the purpose of the trademark is defeated, and it will be assumed that the trademark holder has no interest in continuing to hold it.
  2. If one is using IP without profiting from it, then there is fair use protection. This is not necessarily true. While acting without a profit motive may increase the likelihood of copyright.gov/fair-use/more-info.html" rel="nofollow" target="_blank">fair use protection under copyright law or decrease an IP owner’s desire to pursue legal action (though one should not count on it), it is certainly not legal to print copies of a copyrighted book and distribute them for free. It is also not legal to build replicas of patented IPs and give them away. Even if one has no financial gain in mind, they should ask for permission before acting.
  3. One cannot trademark what they did not invent. It is often assumed that IP protections only relate to what one created on their own, but this is not the case. Patent law protects personal inventions, and copyright law protects personal creations, but trademark law protects the ability of a business to avoid consumer confusion while building a brand. Thus colors, shapes, sounds, and even smells can be trademarked if it is demonstrated that they are closely enough linked to a brand’s success.

How to Avoid Intellectual Property Claims

Aside from not making assumptions about the law or about an IP holder’s willingness to sue, one can also take a systematic approach to IP claims in order to reduce the risk of legal exposure. Some useful steps to take to achieve this include:

  1. Realizing you have legal exposure. Don’t simply assume that IP claims are only made against others or that if you have only good intentions, you are in the clear. There is always the risk of an IP claim; all you can do is work to reduce it.
  2. Developing internal processes to minimize legal exposure. An IP compliance program should be developed and all employees should be trained in it. Such a program should evaluate a company’s current level of legal exposure and verify that any information used by the company is not copyrighted, or, if it is, that permission has been granted for its use. The financial, legal, and marketing departments should all be involved in this process.
  3. Obtaining insurance protection. There are a variety of different insurances that one can purchase to gain protection from IP-related suits. Some of these include standalone IP policies, patent defense policies, infringement abatement polices, and infringement cost reimbursements.
  4. Reducing social media exposure. Social media use by employees on company time or technology is a huge source of legal exposure, as you never know when or how an employee might infringe on another party’s IP rights through social media. The best way to avoid this possibility is by creating strong policies that discourage or limit the use of social media on company time or technologies.

If you need further help understanding intellectual property claims, you can post your legal need on UpCounsel’s marketplace. UpCounsel accepts only the top 5 percent of lawyers. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale and average 14 years of legal experience, including work with or on behalf of companies like Google, Stripe, and Twilio.