Entrepreneurs are innovators, disrupting the status quo with products and services that transform everything from mundane tasks to entire industries. In many cases, these ideas have the potential to generate tremendous wealth and success—if you’ve taken the time to cover your back, that is. To really reap the fruits of your entrepreneurial labour, you need to protect your rights and make sure nobody else can profit off your hard work. As such, it’s crucial for all entrepreneurs to learn the ins and outs of intellectual property. Can you tell the difference between a patent and a trademark? Do you know how long until your copyright expires? If not, keep on reading and learn how to make sure your innovations stay safe in your possession.
Intellectual Property Overview
According to the World Intellectual Property Organization (WIPO), intellectual property “refers to creations of the mind, such as inventions; literary and artistic works; designs; and symbols, names and images used in commerce.” In essence, intellectual property entails the legal and moral rights an individual or group has over an invention. If you’re the rights holder for all of the creations that fall beneath the banner of your startup, nobody can profit from these works besides you, unless you give them permission.
Of course, it is important to note that the creator of a work is not always the rights holder. Though the creator holds the rights to a work in many instances, this might not always be the case. For example, in the case of work created through an individual’s work with a company, the rights may reside with the employer. Additionally, it’s necessary to recognize that several types of intellectual property protection exist, each with different terms and applications. Learning about these different ways of protecting intellectual property will help you select the methods that are right for your startup.
Types of Intellectual Property Protection
This post will cover the four major types of intellectual property protection as they operate within Canada: patents, copyright, trademarks and trade secrets.
Patents refer to the laws that protect inventions. To acquire a patent, you must publicly disclose the details of an invention in exchange for exclusive rights for a period of 20 years. During this time, other parties cannot make, use or sell the patented invention without permission from the patent holder. Violation of a party’s patent rights can result in litigation.
In order to obtain a patent for your startup, you need to file for one with the Canadian Intellectual Property Office (CIPO), which will require you to pay a processing fee. According to the Canadian Patent Act, you can patent “any new and useful art, process, machine, manufacture or composition of matter or any new and useful improvement in any art, process, machine, manufacture or composition of matter.” Specifically, to patent an invention, you need to demonstrate that it possesses novelty (ie. it must not already be disclosed elsewhere), utility (ie. it must be able to accomplish what you wish it to) and non-obviousness (ie. it must not be obvious to somewhere with minimal relevant skill or knowledge). In Canada, there is a one-year grace period to file a patent application after a creation has been publicly announced through methods such as a conference or a paper—so it’s important not to drag your heels about applying for a patent if you want to secure your rights over your invention.
Copyright is a type of intellectual property protection that governs works such as literary pieces, films, photographs, computer software and websites—something fixed in a tangible form. Unlike patents, copyright entails no application process. Rather, copyright is instilled automatically upon the creation of a work and generally lasts the lifespan of the author plus an additional 50 years. In Canada, copyrighted works require no registration; however, in order to ensure other countries respect your copyright, it is recommended that you include with your product your name, the year of first publication and either the word “copyright” or the © symbol. However, it’s important to note that some things can’t be copyrighted, including ideas, brand names and slogans. To protect these creations, you need to apply for other forms of intellectual property protection, such as patents or trademarks.
If you want your startup to earn money off a copyright, you can do so through licensing. By licensing a copyrighted property to someone else, you permit them reproduce a work for a fee paid to you. For example, when you install software onto your computer, you don’t actually own that software; rather, you have simply been given permission to install and use a copy.
Trademarks exist to protect names, logos, slogans, product lines or domain names—essentially, anything that involves branding a company’s products or services. Common law trademarks are obtained immediately when a startup uses a distinctive form of branding, such as a unique company name. There is no registration process involved. Alternatively, statutory trademarks can be registered by filing for one from the government, and, as with patents, there is a fee involved. Registering a statutory trademark affords you greater protection, particularly should you need to defend your trademark in a federal court.
Given the fee associated with statutory trademarks, startups should be strategic in selecting which items to register. Generally, if the startup plans to use a particular slogan or logo for an extended period of time (ie. longer than a year), it would be worthwhile to obtain a statutory trademark. On the other hand, for slogans only used during a brief period or minor product lines with an indefinite future, the trademark application process would likely not be worthwhile.
Trade secrets comprise an additional form of intellectual property protection. When startups wish to conceal the details of their products from the public, they can do so by having employees sign an agreement to ensure coveted information remains private. For example, startups might use a confidentiality agreement to ensure certain information will be held in confidence. Alternatively, they could use an invention non-disclosure agreement, which function similar to confidentiality agreements but apply specifically to unpatented inventions. Finally, startups might have employees sign a restrictive convenant, which prevent departing employees from using their knowledge of a company’s trade secrets to compete with them.
For more information about intellectual property, be sure to check out the Canadian Intellectual Property Office, these great UBC resources and this article from MaRS DD. If you wish to learn more about intellectual property in American contexts, check out the United States Patent and Trademark Office and this video series from the University of Michigan College of Engineering. For more information on UBC’s commitment to helping local and area entrepreneurs, check out what our partners are doing at Entrepreneurship@UBC.