THE LESSOR KNOWN IP COUSIN

In the field of intellectual property (“IP”) law there are some very well-known and popular legal tools – the usual suspects, if you like. These include patents and trademarks.

They are best known and most often presented to inventors and business owners as therights to own to protect inventions and businesses from copycats.

Unfortunately the process to acquire these rights is expensive and protracted. Many inventors and business owners abandon IP applications before grant. This is often because of the high cost involved in pursuing these to grant, exacerbated by the lack of income generated from an invention (it takes notoriously long to make money from inventions or new businesses, especially in countries foreign to an inventor or business owner).

At some point most inventors require external investment to drive a project to profitability. Such external investors – venture capitalists – typically drive hard bargains and wish to minimize their risk. They invest in products or projects, not in patents, trademarks or designs. But they want granted patents, trademarks or designs to protect their investments.

One aspect investors are very weary of is attaching value to pending (‘yet-to-be-granted’) IP rights. In most cases it is difficult to obtain an accurate and objective view on the likelihood of achieving grant of an IP application, especially patent applications that are subjected to proper examination such as in the USA, Europe, China, Eurasia, and Australia.

Investors therefore very often discount the value of pending IP rights heavily or even completely. It is only once IP rights are granted that investors value them higher or at all – for then they provide real and enforceable rights, and thus minimize the investor's risk.

But getting these IP rights granted may take too long or may prove financially ruinous to the inventor.

This leaves the inventor with a difficult choice – sacrifice a big chunk of the ownership and effective control in the project or miss out on the investment and potentially see his project end prematurely.

Either way the inventor is left frustrated and/or poorer for it.

ENTER THE REGISTERED DESIGN

Often it is the lesser known IP cousin – the registered design – that may save the day for the inventor.

A registered design provides narrower protection than a patent and it lasts as little as half the life of a patent. Since its protection is narrower than a patent it is easier for a clever copycat to bypass the invention.

It also goes by many names - registered design, industrial design, design patent, design, model, and many more.

No wonder it is lesser known.

But, there are some notable points in favor of the humble design registration.

It is much faster, typically months and not years, to obtain a granted registered design than to obtain a granted patent or a trademark. The cost of a granted registered design may be a fraction of the cost of a granted patent. As an example, the cost to obtain a granted European patent in all the available EU member states may exceed $100 000. To obtain a granted European design in all the available EU member states may cost as little as $2500.

Since design protection is generally defined in the form of drawings of an article embodying the design accompanied by a simple description of the features of the registered design, it is easier, faster and less costly to enforce (some would say there is far less for attorneys to go on about – a judge can compare the allegedly infringing article with the design drawing and determine infringement almost in a heartbeat).

This allows an inventor to obtain effective protection, faster and cheaper. If a registered design is applied for instead of a patent application, it leaves the inventor far less out of pocket – hopefully still able to push the project to profit without the need for external investment.

If he does still need external investment he will then have granted IP rights to minimize the investor’s risk, which may just provide the level of comfort for the investor to proceed with the funding.

If the invention that forms the subject of the project and the registered design is infringed, the inventor has an enforceable right that is cheaper and easier to enforce. This may lead to a quicker injunction or the possibility of a license income from the former infringer.

It is thus important to seriously consider the advantage that a registered design provides - it may just be the right tool for the job.