Intellectual Property Rights

Intellectual Property Rights

INTRUDUCTION

Intellectual Property: knowledge, creative ideas, or expressions of human mind that have commercial value

and are protectable under copyright, patent, service-mark, trademark, or trade secret laws from imitation,

infringement, and dilution.

Secret information can be protected as an IP right when it has economic value, form of competitiveness for

the company (ex. formula used by KFC to fry the chicken and by Coca Cola to make the drink)

Intellectual Property Rights: These rights are exclusive rights (so, exclude third parties from producing,

selling, offering, exploiting at commercial level the subject matter covered by the IPR unless there is a

special agreement, no special permission for the owner, doesn’t give anything to the owner, it is a negative

right). ADVANTAGES DISADVANTAGES

Protection Wrong protection

Tool to acquire companies, competitors, territories, No support of legal action

markets

Financial Costs

Transfer / License Managing

Strategy Co-ownership

The goal is to have an IP system that supports a healthy, balanced and stimulant innovative system.

With IP rights we have several different rights giving a substantial monopoly to their owner which have

different economics consequences and are subject to different economics analysis.

Industrial Property: series of rights belonging to a company, that in order to be valid they must be

formalized.

Such rights are granted to:

• Inventions: new ideas that affect technical or technological feature, machines or methods

• Trademarks: distinctive signs that identify a Company, a service or a product

• Models and designs: forms and designs (2D or 3D)

• Know-how (secret information): technical, technological, commercial and managerial knowledge

Industrial PR: patents, trademarks, models and

designs, know how, software, domains

Intellectual PR: all previous ones plus copyrights

Rights are used to:

Þ defend one’s own know-how, ideas, images and products;

Þ limit aggressiveness of competitors by creating barriers;

Þ putting a company in an advantageous condition (as it can enjoy something which characterizes it)

Þ obtain an advantage in economic terms; 1

Þ prevent third parties from taking possession of same right;

Þ put the company in a prime position on the market;

Þ keep competitors away from the basic ideas that characterize the company

Þ demonstrates a company’s technical and/or technological know-how

It should be remembered that policies to protect one’s own inventions, models and/or designs and

trademarks are independent policies and normally autonomous from each other.

Right granted to industrial property must be associated with a company, a product or range of products, so

that costs that have to be sustained in order to formalize the right must be correlated to the economic

results which the right allows to obtain.

It may be not always logical or useful to keep valid all rights for the whole duration provided by the norms.

Company must always carry out periodical reviews, at least annually, in order to let go those rights which

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have already fulfilled their purpose

Ways industrial property rights are managed by companies:

• A central office is provided which receives internal requests and manages them.

•Each division or operating sector (marketing, commercial, technical) has its own office which manages

typical rights of that sector.

It must be remembered that a strong right, is often object of active aggression (its very existence is brought

into question) or passive aggression through the use of solutions conflicting with the right or equivalent to

it. It is always good not to give third parties any reference to the rights possessed except in general terms

(writing on the product and/or advertising material, etc.)

Pay always attention to the erroneous communication since it can cause sanctions:

→for a patent title: Still in application stage: “patent pending” or “pat. Pend.” ; if granted: “patented”

→for trademark (depending on the country): if still at application stage: “trade mark” or “TM”; if granted:

“ (R) ”

→for a model or design: “registered design” or “reg. Design”

Company should have a security regulation which formalizes the strategies that must be followed, in order

to protect the company know-how in various occasions. It is important to protect also small inventions

found in vital points of a machine, device, etc. from third parties.

Extensions should be made in a reasoned manner and on projections of 7-10 years.

PATENT OF INVENTION

A government authority or license conferring a right for a title for a set period, especially the sole right to

exclude third parties from making/using/selling an invention.

I. In Italy, and in most countries, a patent of invention lasts at most 20 years, provided that the relative

fees are paid annually to maintain the patent; when the application is filed, in Italy, no yearly fees

are paid. The first yearly fee due is the fifth.

II. The content of a patent application (richiesta ufficiale) remains secret for 18 months. In Italy, the

Proprietor (applicant) may request, when he files the application, that his application be made

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public, which happens after a minimum of 3 months from the filing date. The effects of a patent

application come into force on the date on which the content thereof is made accessible, or notified,

to third parties.

III. While the content of a patent application remains secret, it's not appropriate to communicate the

inventive idea to third parties, unless certain precautions are taken.

IV. The content of a patent application for an invention filed in Italy is protected provisionally in al-

most all the world for 12 months; after this, protection continues only in those countries where

the patent application has actually been filed and becomes exclusive only when the patent is-

granted.

V. The use of patent can be active (offensive way) or passive (defensive way); in both cases it can be

used strategically in the specific market and with the relative competitors. The strategic use of

patents increases the litigations and legal costs, which are much higher than the reduction of

costs in filings and prosecutions represented.

VI. In those countries where an examination of merit is required, they have to pay the filing and

maintenance fees, the expenses for the examination procedure and the expenses to overcome

any possible opposition to the final grant, which any third person can file.

VII. The inventive idea that characterizes an application for a patent of invention must not have

been made public, for example by selling the relative product or even only proposing it for sale (if

the inventive idea is easily deduced from the product), before the application has been filed.

The inventive idea can be the subject of trials and experiments, on condition that everything is

subject to confidentiality (riservatezza).

VIII. The inventive idea that characterizes an application for a patent of invention must not be a repro-

duction of something which is already present elsewhere, nor must be a banal re-elabortion of

what already exists.

IX. The name of the actual inventor must always be given, keeping in mind that according to certain

contracts with the employer, the inventor may have the right to a "fair compensation" over and

above his salary, or above the compensation agreed on for his work as designer or researcher.

X. When plans or prototypes are commissioned from third parties, it is necessary to define in the

contract, clearly and in advance, who the proprietor of any inventive idea will be, and how the

inventive contribution of a third party will be regulated economically.

XI. All search have a certain - not absolute - degree of certainty, a certain degree of cover and are

updated only to a certain point. The result is only certain when a prior art document is found

which is identical to the inventive idea to be verified (negative certainty). A prior search is in fact

a feasibility (fattibilità) study.

XII. It is possible to carry out continuous checks on specific subjects or on specific names, f.e. to moni-

tor competitors or a particular sector.

XIII. It is advisable to extend the content of an application for a patent of invention only to those coun-

tries where it is thought that there might be a real economic interest to do so, in the medium

term, or where there are potential competitors, and to avoid those countries where in any case it

is not economic to start a court case against third parties in infringement (violation).

XIV. There are two things to evaluate to decide whether to proceed with a patent application:

1. The expense for a patent (filing, extension, obtaining and maintenance) should not be

more than a percentage of the turnover which may be assumed to be obtained with the 3

product which contains the inventive idea of the patent. This percentage depends on the

gross profit that the product allows.

2. A patent binds a technology to its proprietor and therefore creates a barrier against third

parties wanting to enter the market. The decision as to whether to proceed with a patent

application mist therefore be a financial one (and also a strategic one, sometimes).

XV. An application for a patent of invention can be extended abroad in the following ways:

a. country by country → the national way;

b. the way of the European patent for member countries and, for non-members, the national

way;

c. the delaying PCT (Patent Cooperation Treaty) procedure for member countries and, for

non- member countries, the national way.

XVI. Before filing the content of an application for a patent of invention abroad, it is advisable to verify

if the inventive idea described therein has undergone (subito) any modifications or implementa-

tions, in order to adapt the patent application before it is extended.

XVII. At present, in Italy, an application for a patent of invention becomes a patent about 3 years af-

ter filing. Applications for a patent of invention in Italy are subjected to a search for prior art with

regard to merit that takes place between 9 and 10 months from filing and allows the inventive

content to be appreciated with a high level of certainty.

Prior Art: all information that has been made available to the public in any form before a given date

that might be relavant to a patent’s claims of originality

XVIII. Structure of a patent:

• Title: it can be searched in the database so it should be general, should not give explaina-

tion;

• Abstract: short summary of the invention – draft only for bibliographic purposes, general;

• Background of the invention: field and prior art – what is known in the state of the art

• Summary of the invention: explain what the invention is but not in technical terms

• Drawings and descriptions: how does the invention provide a solution to the technical

problem?

• Claims: what is the scope of the invention/the protection sought? - A patent can have

product claims, method claims, device claims and use claims. The main claim must con-

tain that part of the inventive idea which constitutes the invention; it must also contain

the product or the method. The description must explain the function it performs and

what contribution it makes to the inventive idea. (A third party is infringing the patent

right if the main claim is copied!). The content of a prior art document used to evaluate

the validity of a patent claim remains frozen at the date on which said prior document

became available to the public, when it is compared to the novelty. Content of an applica-

tion for a patent may be licensed to third parties.

XIX. The content of an application for a patent and of a patent is defined by the content of the claims

which are identified after the formula “characterized in that”. The content of a claim has to be in-

terpreted in the light of what the description and drawings identify to be the applicant’s inten-

tions. It is only what is contained in the claims, and particularly in the independent claims, that 4

can be used against third parties. Normally, a claim that does not contain the division “character-

ized in that”, or similar, can be said to be infringed when it has been integrally reproduced. In-

fringement occurs when the content of an independent claim is reproduced practically literally,

or when it is reproduced by equivalents.

XX. The main claim must contain the so-called “bottle neck”, that is to day, the part of the inventive

idea which constitutes the invention, and which the adverse party must necessarily adopt in order

to obtain the same advantages add benefits.

Þ The fewer things are included to define the “bottle neck”, the more difficult it will be to “get out of” the

patent, that is to say, to manage to get round (arrivare) the inventive idea patented.

Þ The more things are contained in the main claim (the so-called “shopping bag” main claim), the easier it

will be to have the patent granted, but it will also be easier for third parties to get round the patent.

The description of the content of a claim must explain what function it performs and what contri-

bution it makes to the inventive idea. When a dependent claim is used by a third party, but not

the independent claim which supports and justifies the dependent claim, then there is no in-

fringement.

XXI. The content of a prior art document used to evaluate the validity of a patent claim remains fro-

zen at the date on which said prior document became available to the public, when it is compared

for novelty; when it is compared with regard to inventive activity, it must be up-dated with the

normal knowledge and experience which have been acquired in the meantime up to the priority

date of the patent.

XXII. The content of an application for a patent may be assigned (licensed to third parties).

XXIII. Software can be protected by a patent of invention on condition that it is used for productive ac-

tivity and as such it is the functions performed that are protected, not because of how it is writ-

ten.

XXIV. With a patent it is possible to protect:

• the method;

• the machine or plant that embodies the method;

• the tools;

• the devices (dispositivi) or whatever else is essential and univocally dedicated to the

method;

• in certain case the use of the product obtained.

Machines/Plants embodying the method Product; the use of it

Method; Tools; Devices Process

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A method patent can protect the product obtained, the plant that uses said method, when it is made to

function with said method, the machines, the essential devices or the strategies essential to carry out the

method. A method patent follows the product obtained with it, so that products made using the method in

countries where the patented title is not present, in many situations cannot be sold in those countries

where the patent is present.

XXV. The following cannot be covered by a patent:

• Discoveries, scientific theories and mathematical methods; 5

• plans, principles and methods for intellectual activities, for play or for commercial activities;

• programs for processors;

• the presentation of information;

• surgical or therapeutic treatment on the human or animal body;

• diagnostic methods applied to man.

XXVI. The patent confers the following exclusive rights on the holder (proprietor):

• rd

if a product: the right to forbid to 3 parties (except with an agreement of patent holder) from

producing, using, trading in, selling or importing for such purposes the product in question into

those countries where the patent is in force.

• rd

if a method: the right to forbid 3 parties (except with an agreement of patent holder) from

applying the method, or using, trading in, selling or importing for such purposes the product which

is directly obtained by the method in question in those countries where the method is in force.

In case of a method patent, any product which is identical to the one produced by means of the patented

method is presumed to have been obtained, by means of the said patented method according to one of

the following cases:

• product obtained by method is new;

• if there is probability that the identical product was made by means of the patented method and if

the holder of said patent is not able to determine the method actually followed.

XXVII. The rights conferred by a patent are territorially defined and consists to the exclusive right to work

the invention and earn profit therefrom in the Italian territory.

Ex: If a product is given right of invention in Italy, the right is extended to the sale of the product

to which the invention refers, but expires once the product is put on sale by the proprietor of the

patent or with his consent, inside a member State of the European Union or the European

Economic Area. If the original product is put on sale outside the European Economic Area and

then is imported into it, the owner of the right can oppose this because, the right has not expired

inside the European Economic Area.

If a product is manufactured in a country where the patent does not exist, and then the product is

introduced in a country where a method patent does exist, said product can be used in said

country only by the owner or his successor in title of the method patent.

2.2 DEFINITION

An invention is when an original solution is found to a technical problem, in practice an invention is an

intuitive combination which until then had been lacking of pre-existing concepts, ideas or features.

The concept of industrial invention is founded in the solution of a technical problem which has yet not been

solved; the solution must be able to have concrete applications in the industrial field (such as bring progress

with respect to existing techniques and knowledge and to express creative activity on the part of the

inventor), it must not be a simple association or application of already known ideas in similar fields to solve

the issue.

I give you the monopoly of this invention and once public you teach people how it works, tool to fight

competitors.

The patent system provides a right that is valid