Intellectual Property for Social Sector Organizations:
Q&A with Legal Expert Margaret S. Millikin

Virtually everyone in the world today uses intellectual property (IP) or objects that embody it. IP defines a group of intangible assets that cannot be perceived with the senses yet which comprise real value for the organizations that own or use them. This is so even for social sector organizations (SSOs) that intend through their efforts to effect change for the better in their respective spheres of influence.

The following answers to frequently asked questions about IP may help your SSO better understand how to use IP rights to achieve its organizational goals.

1.  What is IP?

Intellectual property is a type of property right that grants the owner certain privileges defined by the laws creating the IP in question. IP rights work similarly to tangible property rights, with the primary difference being that the IP itself cannot be perceived with the physical senses, although it can be perceived in physical objects that embody it. In short, IP is an asset that holds value and that can be leveraged in the same way that your physical assets can be leveraged.

2.  How does IP benefit an SSO?

All organizations exist for the reasons set out in their organizational charters. Whether your raison d'être includes profit or nonprofit motivations, IP is a tool that can be used to achieve your goals. The best IP tool or portfolio of tools for the job will depend upon your SSO's specific objectives.

3.  Are IP rights relevant to nonprofit organizations?

Yes. Virtually all organizations own or use IP, including nonprofit organizations. IP laws encourage innovators of all types to share their creativity and, in return, award certain rights which can be leveraged strategically. Many nonprofits use their IP to spread their message, reach a broader audience, build their reputations, and increase their spheres of influence to do good in the world. IP assets, at a minimum, are tools used to achieve goals, even those goals not grounded in the profit motive.

4.  My SSO champions the rights of indigenous peoples. Are IP rights relevant to our groups?

Yes. The cultural property rights of indigenous peoples sometimes enjoy the protection of special laws that shield them from exploitation by others. Conventional IP rights may also serve the purposes of indigenous peoples in protecting their heritage. Consider leveraging both specialized laws and generic IP when protecting the traditions and cultural heritage of the world's indigenous populations.

5.  What are the types of IP?

The basic forms of IP typically include patents, trade secrets, copyrights, trademarks, utility models, industrial designs, proprietary know-how, and geographic designations. Click on each of these terms for a better understanding of the rights inherent in these forms of IP.

An overview of state and federal intellectual property laws is also available at LawForChange Legal Resources: Intellectual Property.

6.  What is a patent?

A patent is a governmental grant that defines the boundaries of an invention and gives the owner the right to exclude others from practicing the invention, usually for a term of 20 years. Patents protect the substance of an idea in the useful or technical arts, such as articles of manufacture, compositions, processes and, in some countries, business methods.

A patent is effective only within the territory of the country granting the patent, although there are some intricacies to patent enforcement that can give extra-territorial effect to patents. Nevertheless, you must seek a patent from the issuing agency of each country where you wish to obtain patent protection for your invention. International treaties simplify the process of seeking multiple patents outside your home jurisdiction.

After the government grants a patent, the owner must pay issuance fees and periodic maintenance fees or annuities to maintain the life of the patent over the full legal term.

7.  Does my patent give me the right to practice my invention?

No. A patent gives the owner the right to exclude others from practicing the invention. It is very important to understand this distinction. It is advisable to obtain a legal opinion that the practice of your new invention does not infringe a pre-existing patent, even when you have or seek patent protection for your invention.

8.  What is a trade secret?

Like a patent, a trade secret protects the substance of an idea, even an idea that is not necessarily patentable. A trade secret is information that is kept confidential, while being exploited, and it gives one an advantage over competitors. While a trade secret theoretically is unlimited in duration, and some trade secrets have existed for hundreds of years, the trade secret is lost when another independently arrives at the protected information.

It is important to weigh the numerous advantages and disadvantages when deciding to protect new ideas via patent or trade secret. Each country creates its own laws protecting trade secrets, and these laws vary in strength between jurisdictions. Legal counsel can help you consider the potency behind the trade secret laws of the regions where your SSO operates.

9.  What is a trademark?

A trademark is a symbol that identifies your products and services and distinguishes them from the products and services of others. Words, pictures, sounds, abbreviations and colors are examples of symbols that function as trademarks. The public will associate certain qualities with your SSO's trademark and, in this sense, your trademark can be likened to the reputation of your business. Therefore, you should protect your SSO's trademark, just as you protect your reputation. This motto is as equally true for nonprofit SSOs as it is for profit-based concerns.

Keep in mind that there are various types of marks, such as certification marks which certify quality, safety, or geographical origin, for example. Your SSO may have particular goals which are best served by a particular type of mark, and your IP counsel can help with these distinctions.

10.  Can I choose anything as my trademark?

Generally speaking, the more distinctive the mark, the stronger it is. Descriptive marks, while easily conveying the attributes of the products or services with which they are used, are weaker marks. So be creative! It is also wise to obtain a clearance opinion that a mark is available before adopting it for use in a particular country or region.

11.  How does registration of a trademark benefit my SSO?

Some countries require that a trademark be registered before the mark is accorded legal protection. Other countries grant what are called common law rights. In virtually every country, however, registration of a trademark grants special legal protections and privileges, including the exclusive right to use the mark in association with the registered goods and services. Registration also gives the owner leverage in the event that another entity uses a similar trademark in a manner that deceives or confuses others.

Your SSO should adopt standards of use for its trademarks and monitor use of the trademarks. Failure to enforce compliance with usage standards can result in loss of the mark. For example, words such as yo-yo, aspirin, and elevator used to be trademarks but through improper usage, these marks have lost their trademark status. Take control of your marks and use them properly to maximize their value and your ability to achieve SSO objectives.

12.  What is a copyright?

A copyright protects original works of authorship fixed in a tangible form. Phrased another way, a copyright protects the expression of an idea but not necessarily the idea itself. This expression can take the form of books, paintings, movies, choreography, magazines, statues, and many other forms. A copyright grants exclusive rights to reproduce the work, prepare derivative works, distribute copies of the work, perform the work publicly, and display the work.

13.  Do I have to register the copyright in my SSO's works?

No. The copyright is created when the work is fixed in a tangible form. However, in many countries, the work must be registered before you may sue to enforce your SSO's copyrights. Registration also offers additional legal rights and privileges, such as recovery of attorneys' fees and statutory damages in infringement actions.

Many organizations have prolific authors of protectable works. In some cases, it is neither logical nor feasible to register all of these works. Your SSO's charter and goals will help define the need for copyright registration and target the identity and number of works which will be amplified by registration.

14.  Must my SSO register our copyrights in every country of the world?

Generally, no. Through the Berne Convention, treaty member states automatically honor the copyrights of citizens residing in other member states, to the same extent that such states recognize the copyrights of their own citizens. Member states must adopt a minimum level of copyright protection prior to becoming party to the Berne Convention. Because of this, citizens of one member state need not formally register their copyrights in other Convention states in order to procure copyrights in their original works of authorship. Such rights arise automatically.

It is important to distinguish between creation and enforcement of your copyrights. Even though the Berne Convention requires member states to enact laws recognizing copyrights automatically without formal registration, member states may require formal registration as a precondition to enforcement of the copyrights against a third party. Therefore, enforcement of your copyright may necessitate a formal registration process, either in the member state and/or in the country in which you wish to enforce. In the event of a suspected infringement of your SSO's copyrights, an attorney can advise you on the steps required to properly enforce your rights.

While about 85 percent of the countries of the world are parties to the Berne Convention, keep in mind that some countries have not signed this treaty. One resource for checking Berne Convention membership can be found on the WIPO web site at:

http://www.wipo.int/treaties/en/documents/pdf/berne.pdf

If the country of interest to you is not party to the Berne Convention, you should check membership in the Universal Copyright Convention, which also offers multilateral copyright protection but requires different standards of protection more palatable to certain countries.

Although countries with no treaty membership are few, your SSO may need to register its copyrights separately in those few non-treaty countries of interest. Fortunately, copyright registration is relatively inexpensive and copyright offices around the world provide excellent guidance on the registration process.

Links to these treaties and other copyright resources may be found in the Additional Resources section.

15.  What are utility models?

Utility models, sometimes called "petty patents," protect inventions but tend to be of shorter duration than regular patents and typically pose fewer hurdles for issuance. The requirements of inventive step for utility models are less stringent, and the range of subject matter eligible for protection via utility model may be narrower in some jurisdictions. As with patents, utility models are granted by the country where the invention is to be protected. At this time, approximately 60 countries offer utility model protection. A list of these countries is available on the World Intellectual Property Organization (WIPO) web site.

16.  What are industrial designs?

Industrial designs, sometimes called design patents, protect the unique and ornamental features of a useful article. In contrast to copyrights, which safeguard original works of authorship fixed in tangible media, industrial designs protect the new, original aesthetic features of useful articles producible through industry, such as chairs or flower pots. Designs that are the result of the function of an article are not protectable. Although industrial designs tend to carry the same enforcement protections as regular patents, they often are of shorter duration and do not require the payment of maintenance fees to extend the life of the design over the full legal term.

17.  What are geographic indications?

Geographical indications (GIs) name the geographical origin of a product and, in so doing, specify qualities, reputation or characteristics distinctive of regional origin. Examples of famous GIs include Scotch whiskey, Idaho potatoes and Champagne. GIs are well established in some countries, while they are a newer concept in others. In any case, several international treaties now govern the protection of GIs.

18.  What is proprietary know-how?

This category of intangible assets is very large and encompasses information that your SSO owns or controls and that is not in the public domain. Proprietary know-how cuts across a broad spectrum of organizational functions including human resources, finance, sales, customer service, technology, and marketing. It also includes items that some people may not think of as being protectable, such as spreadsheets, reports, studies, test data, business development strategies, marketing plans, non-commercial software, and customer lists, to name only a few. Leading organizations manage this amorphous bundle of knowledge as an asset class and realize value from it.

19.  Should my SSO implement internal IP management policies?

Yes. There are a number of actions SSOs can take to internally manage their IP. Consider having employees execute assignment agreements addressing IP and keeping confidentiality obligations to the SSO. Place IP policies in employee manuals and post them on your SSO's intranet. These polices should outline the SSO's procedures for ownership of IP created by employees in the course of their employment and set out guidelines for use. They also should explain how the SSO creates and manages its IP and what employees should do if they suspect or learn that an offensive or defensive infringement claim has arisen. IP polices may cover many topics not discussed here and can have legal consequences, so consult with experienced IP counsel when drafting them.

20.  How do I think strategically about IP rights to achieve my SSO's goals?

Young ventures are uniquely positioned to benefit from intellectual asset management strategies as they build IP portfolios and tailor them to achieve organizational aims. Fledgling groups can be mindful of the organizational goals while on the "ground floor," which makes it easy to incorporate IP management into the consciousness of the SSO as it grows.

Begin to think strategically about IP by viewing this asset class as more than legal rights. Manage your SSO's IP as business assets that have financial and/or societal value. Some establishments even see their IP as more than an asset class and integrate responsibility for IP creation, management and exploitation throughout the fabric and culture of the organization. There are a number of books and periodicals that coach entrepreneurs in intellectual asset management skills.

21.  My SSO has been around a while. What should we do to better manage the IP we have collected?

You can approach this in many ways. Often, the first step is to marshal all intellectual assets used or planned for use in your organization to carry out operations and determine where they originate. An IP audit is particularly useful for providing a comprehensive review of the organization's overall IP structure and for identifying the areas from which IP is likely to originate.

Next, create a cross-functional management team comprised of individuals with at least business, technical, tax, marketing, and IP legal expertise to gain maximum value for the IP spend. The team makes decisions about the portfolio and creates policies that protect the assets.

Finally, leverage these assets. Implement studies of competitors' portfolios to determine trends and white spaces. Maintain an active licensing program. Monitor the use of your IP and prosecute infringers. Competitive intelligence programs, watch services, and enforcement programs provide good tools to achieve these ends.