How to Navigate Intellectual Property Laws and Protect Your Ideas

Entrepreneurship and the onset of new businesses are playing a critical role in rebuilding the Detroit economy. As the city emerges from bankruptcy and embarks on its future, dozens of new entrepreneurs, investors and business leaders have seized the opportunity to contribute to the growth of a resilient community and thriving business scene.

Yet many entrepreneurs are worried – with good reason – about having their business idea stolen or poached by competitors. Legal safeguards exist to protect intellectual property, yet the differences and advantages between these options can be murky. Often the most challenging part is to determine which route is the best for a particular business idea.

With decades of experience both defending and examining intellectual property laws in the courts, I have compiled key information and critical insights for entrepreneurs looking to protect their work.

Your idea is great, but is it intellectual property?
If you are an entrepreneur with a great idea, the first question to answer is whether your idea is unique or exclusive enough to merit legal protection. If your small business makes paper clips, even the most breathtaking and brilliant of paper clips will probably not qualify for legal protection.

Many ideas that do not qualify as intellectual property are still crucial to your business. Employee manuals and policies, along with non-disclosure and non-compete clauses are very common and sound methods to manage your company’s sensitive information.

Business leaders should be careful when they delve into the realm of ideas and inventions, and be prepared to make quick and informed decisions about how to move forward. If your idea springs from something distinctly new, it is imperative to seek professional help immediately.

Trade secrets, patents and copyrights – what’s the difference?
Trade secrets:
Trade secrets provide perhaps the broadest protection, and offer protection to nearly any type of information. A trade secret can be any valuable, confidential or commercial information used by a company and not generally known to the public, such as an invented formula, process, design or a wide variety of information. The purpose is to give the trade secret holder a competitive edge or economic benefit. In essence, a trade secret is just that – a secret.

Once something is designated a trade secret, the holder is legally able to protect it, file lawsuits and prevent employees from disclosing it. Trade secrets have a long reach, requiring courts to carefully sift through a variety of criteria to make the trade secret designation. Courts consider everything from the effort and money spent developing the idea to the effort made to keep it secret, to the ease or difficulty that the idea can be duplicated.

A classic example is one of the most valuable trade secrets in the world: the formula for Coca Cola. The soda’s unique taste is created by a special combination of ingredients, which have remained under lock and key for more than a century.

Patents: Like trade secrets, secrecy is key to the initial stages of acquiring a patent, which can protect nearly anything including a utility, or a plant. The difference is that after the patent has been attained, the mechanics behind the idea or product must be revealed so that the public may learn from it.

So what does the inventor get from sharing their idea? The patent grants the holder an exclusive and protected monopoly on that invention for a period of time, often around twenty years. Applying for a patent does not necessarily mean that you will receive one. I could attempt to patent a stapler or a mousetrap, but the United States Patent & Trademark Office is unlikely to award a patent unless there is something significantly new. Patents encourage creativity and form a fundamental cornerstone of the American economy.

Copyrights: Copyrights deal with the artistic expression of ideas and protect original works of published or unpublished authorship, which includes literary, dramatic, musical and artistic works. This extends beyond novels and songs into the realm of computer software and even architecture. However, a copyright does not protect facts, ideas, systems or methods of operation, although it may protect the way these things are expressed.

If William Shakespeare were alive today, he would likely copyright “Romeo and Juliet.” However after a certain period of time, usually several decades after the author’s death, the work enters into the public domain. As such, there is no copyright on “Romeo and Juliet,” so it can be freely shared.

A copyright attaches to your work once it is created, so you only need to register it if you want the copyright on public record, to have a certificate of registration, or to establish a lawsuit for copyright infringement and certain attendant damages.

Battling in the courts
Even with legal protection, competitors and industrial leaders may still go to great lengths to capture a marketable idea for their own use. Trade secrets, patents, and copyrights are heavily litigated in courts in the U.S. and around the world.

The specifics behind these protections vary by jurisdiction and nation. It is imperative that entrepreneurs understand their rights and legal options to protect intellectual property and preserve their work from infringement or theft. Hiring a firm that specializes in litigation can be an extremely wise investment for companies looking to go to the mat to defend their intellectual property.

Creativity and innovation are the lifeblood of American business. By developing new or unique processes, ideas or inventions, businesses are able to differentiate and distinguish themselves in the marketplace. A company’s brand and reputation are crucial to their success, and are tied to the quality and value of their intellectual property. As such, I cannot imagine anything more important to the inventor, artist, or entrepreneur than the ability to legally protect their work.