A contractor's guide to intellectual property enforcement and avoiding infringement

By Sheana Wheeldon and Nigel King
Kensington Swan Lawyers

In our first two articles we briefly outlined the different types of intellectual property (e.g. trade marks, patents and copyright) and explained why intellectual property is relevant to the contracting industry. This final article deals with enforcing your intellectual property rights and avoiding infringement of other parties’ rights.

To maintain the strength and value of your intellectual property, and so your market position, it is important to take a proactive attitude. This includes monitoring the activities of your competitors.

1.  Know what your intellectual property is

Knowing what intellectual property you own or use might seem obvious, but this point is often overlooked until it is too late. Compiling and maintaining a list or portfolio of your intellectual property is a useful exercise.

2.  Publicise your ownership of intellectual property

An effective enforcement tool is the use of recognised intellectual property symbols. Publicising your intellectual property rights is a good deterrent to would be copy-cats. The important intellectual property signs are:

• Registered trademark – ® (for example, Kensington Swan®);
• Unregistered trademark – TM (for example, Kensington SwanTM);
• Copyright – © (for example, ‘© 2009 Kensington Swan. All Rights Reserved.’ The format is the year of creation and the name of the owner);
• Patents – (for example ‘NZ Patent 12345’ for a granted patent and ‘NZ Patent Pending 12345’ for a pending patent);
• New Zealand Registered Design – (for example, ‘NZ Design 123345’).

It is not compulsory to use these intellectual property symbols but it is an offence to claim something is the subject of a registered intellectual property right when that is not the case.

3.  Actively monitor your competitors’ activities

Actively keeping an eye on your competitors and the marketplace is essential in making sure your intellectual property rights are not being infringed. As you will no doubt be aware there are various ways to monitor your competitors’ activities, such as carrying out regular internet searching and talking with sales and marketing people who are actively involved in the marketplace. Sales people are often out and about talking to consumers, distributors and retailers and may have an idea what your competitors are doing.

Trademark register watching services are very useful in finding out whether your competitors are attempting to register any trademarks that are too similar to yours. The service involves a monthly search of the trademarks register for any new trademarks that are identical or similar to yours. It can also watch for any new trademarks filed by your competitors. A quick response to any potential problems revealed by a watching service can ‘nip in the bud’ a possible dispute at an early stage. Engaging a watching service will ensure you do not miss the three month period you have to oppose an accepted trademark application after publication.

4.  Keep your intellectual property strong

It is important to ensure that your intellectual property does not become vulnerable to attack. For example, a registered trademark that becomes generic can potentially be revoked – that is when it no longer indicates trade origin and instead becomes a common word. For example, people use the term ‘hoovering’ instead of ‘vacuuming’ puts the trademark Hoover (a famous brand of vacuum cleaner) at risk of becoming generic.

The correct use of trademarks and brands is essential. Many companies use a corporate branding guide which dictates how its trademarks are to be used. This ensures that there is a consistent image being conveyed to the marketplace. You will notice that many of the major brands advertising in this magazine will have a consistent image in the marketplace.

5.  Deal with infringements immediately

When you find out there has been a possible breach of your intellectual property rights, it is vital you seek legal advice and act quickly. Allowing infringing activities to continue will not only damage your position in the market, but will allow your infringing competitor to build up its own business and reputation at your expense.

Generally, the first step in dealing with infringement is for your lawyers to send a warning letter to the infringer informing it of your rights and demanding they cease their infringing activities.

Sometimes other parties are not even aware they are breaching your intellectual property rights. Even if there was a deliberate element, many businesses when faced with a strong threat of legal action will agree to stop their infringement to avoid a costly conflict.

Should matters escalate an interim injunction, or the threat of one, is often the most effective means of ‘shutting down’ infringing activities. If the court grants an interim injunction, the infringing party must stop its activities immediately pending a full trial. In practice, the result of an interim injunction application usually becomes the final outcome as parties tend to take a pragmatic approach and settle the matter rather than spend more resources on pursuing it.

Avoiding infringement

If you are launching a new product or brand in the marketplace, you should first make sure you are not infringing anyone else’s intellectual property rights. To avoid copyright infringement, make sure products, drawings, plans and the like are not copied from others. One way of protecting your position is to seek warranties from your contractors and/or suppliers.

Before launching a new name or brand, make sure appropriate clearance searches are made. If you intend to market a new product, a patent and/or design search may be advisable. Appropriate searches should reveal most potential infringement issues before a product is launched. This can save a lot of heartache and lost money down the line, as the threat of infringement proceedings could mean a total revamp of your product or brand, or ultimately result in it being discontinued.

Always seek legal advice if you are not sure of your position. 

A contractor's guide to protecting new ideas and inventions