Protecting intellectual property in the digital age – legal strategies for technology companies

Intellectual Property Rights (IPRs) are encompassing, particularly in the technology sector. There are several types of IPRs such as patents, copyrights, trademarks, trade secrets, and industrial designs. The World Intellectual Property Organisation (WIPO) identified IPRs in form of software and hardware technological innovations, software codes, computer programs, music, video, designs, symbols, phrases, logos, names, images, source codes of software programs, algorithms and formulas used in the technology industry by companies for commercial activities. Intellectual Property (IP) is generally governed by laws that aim to foster an environment where innovation can flourish.

In this digital age, computers accomplish many tasks and make enormous amounts of information available. Technology companies are, therefore, playing a very crucial role across various sectors of the global economy. New business models have also emerged and are still emerging in the digital era. Terminologies like Artificial Intelligence (AI), Automation, Big Data, InsureTech, the Internet of Things (IoT), and the Cloud are essential when discussing digital innovations. All these are related to inventive and creative processes of Intellectual Property Law (IPL).

This article explores the concept of the protection of (IPRs) of technology companies in the digital age and makes recommendations for better legal strategies to protect these IPRs.

Protection of IP rights in the digital age
The digital age has brought about new challenges in the protection of IPRs. The ease of copying and sharing information over the internet has made it easier for infringers to exploit IP assets without the owner’s consent. Therefore, technology companies must adopt effective legal strategies to safeguard their IP rights in the digital age. The unauthorized use and exploitation of digital assets have led to significant financial losses and reputational damage for technology companies. Therefore, protecting IP rights has become a top priority for businesses looking to maintain their competitive edge and protect their brand.

Evidently, many reasons exist for the protection and safeguarding of intellectual property rights, and the most fundamental is to encourage innovation, research, and development by providing legal protection for new and innovative technologies. IPRs in the tech industry also help companies to protect their research and development investments, encourage investment in new technologies, and enable companies to gain a competitive advantage by providing exclusive rights to the use and commercialization of their inventions.

The United States took steps to protect IPRs by implementing two World Intellectual Property Organization (WIPO) treaties: World Intellectual Property Organization (WIPO) Copyright Treaty (WCT) and the WIPO Performances and Phonograms Treaty (WPPT). Additionally, the US passed the Digital Millennium Copyright Act (DMCA) in 1998 to prevent unauthorized access and exploitation of copyrighted material on the internet. This law also prohibits the development and distribution of technology, devices, or services that can circumvent access controls. The Digital Millennium Copyright Act implements the two WIPO treaties and under the Act, it is illegal to circumvent access controls, regardless of whether actual copyright infringement occurs.

 if you share your work online, users might try to copy your creation. However, unauthorized use or duplication of your online IP is significantly more challenging, if not impossible, with Digital Rights Management systems.

In the article “Digitalisation and Intellectual Property in the time of COVID -19”, (2020) Reuters predicts that digitally enabled platforms will account for 70% of new value produced over the next decade. The importance of this is that businesses operating in the digital environment must recognize the value of their IP assets and put in place effective measures to protect them, especially legal measures.

Recommended legal strategies
To achieve the objectives of IPR protection, tech companies must be able to legally protect their intellectual property. First and foremost, obtaining the fundamental IPRs for their eligible works through a variety of rights (such as copyright, trademark, patents, trade secret and industrial designs) in their State jurisdictions is essential to safeguarding and protecting their creations.

Secondly, technology law has made it simple for companies to protect their rights using legal software. An example is CAD Data Protection Based on Blockchain (CADChain) which employs Blockchain technology to significantly permit collaboration, secure sharing, and asset tracking, while technically guarding confidential information like designs and CAD (Computer-Aided Design) data against unauthorized access and offering legal protection.

Thirdly, making use of Digital Rights Management (DRM) systems is another pragmatic strategy. According to Conor Roach (2023), if you share your work online and make it available to users, some of those users might try to copy your creation. What a user can do with your protected work is restricted by DRM, a form of encryption. To Edward Haman, unauthorized use or duplication of your online IP is significantly more challenging, if not impossible, with DRM (2023).

Fourthly, the establishment of more secure login details is crucial. If a trade secret is not adequately protected, law enforcement officials and the courts won’t be convinced that it is important enough to keep private. If the material is sensitive or eligible for IP protection, access must be limited by using strong credentials. This can be done by dividing up teams to prevent sharing of data, teaching staff about the finest security practices for your business and changing passwords frequently. A secure location guarded by an identity and access control system should be used to store all manuscripts, creations, and ideas. Since the majority of breaches result from compromised credentials, it is imperative to keep IP on a system that uses adaptive authentication with risk analysis, or at the very least, two-factor authentication.

Furthermore, it is imperative to select enforceable confidential agreements. There are other titles for confidentiality agreements, such as Non-Disclosure Agreement (NDA), Confidential disclosure agreement (CDA), Proprietary Information Agreement (PIA), and Secrecy Agreement (SA). An NDA forbids any involved party from disclosing any information covered by its provisions. An NDA is a binding document that guarantees confidentiality between the owner of protected information and the party receiving it. Engaging the services of a lawyer to draft an NDA will help you strengthen your protections against IPR breaches like trade secret theft, which happens when an employee gives away confidential IP information to outsiders.

Lastly, it is important to create well-constructed agreements that explicitly transfer ownership of IPRs over works created by an employee and an independent contractor to the company in the contract of service and contract for service respectively. Works created in the course of employment generally belong to the author by operation of IP laws (Principle of First Ownership). The principle also operates in the case of commissioned works i.e. works created by remote workers, freelancers, and independent contractors. Many software developers work on a freelance basis, and it is common for them, being the authors, to retain the IPRs on source codes or software developed by them. Tech companies, therefore, need to ensure that agreements are clearly defined to transfer exclusive ownership of IPRs over works created in fulfilment of the engagement to the company. Ideally, such agreements will expressly state that some clearly specified IPRs are “hereby transferred” and “hereby accepted” by the company.

Conclusion
Summarily, protecting IP in the digital age is important for tech companies to maintain their competitive edge and remain relevant in their respective industries. Legal strategies, such as patents, trademarks, designs, copyrights, and trade secrets, can effectively safeguard digital assets and mitigate risks associated with IP infringement. However, tech companies must also stay vigilant and proactive in protecting their IP by regularly monitoring for potential infringement and taking swift legal action when necessary.

Also, technology companies should consider partnering with legal professionals with experience in IP protection to develop a comprehensive strategy for safeguarding their digital assets. Companies should also prioritize educating their employees on the importance of IP protection and develop policies and procedures for handling IP-related matters. By prioritizing IP protection, tech companies can ensure the longevity and success of their innovative ideas, technologies, and creations in the ever-evolving digital landscape.

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Christian Aniukwu is a Partner at Stren & Blan Partners and heads the Firm’s Intellectual Property (IP) Prosecutions and Commercial Services Practice Groups. Kayode Akindele is an Associate in the Corporate and Commercial Dispute Resolution Unit of the Firm, while Stanley Umezuruike is an Associate in the Dispute Resolution Department of the firm, with a speciality in Intellectual property, Entertainment and Technology law-related matters.

Stren & Blan Partners is a full-service commercial Law Firm that provides legal services to diverse local and international Clientele. The Business Counsel is a weekly column by Stren & Blan Partners dedicated to providing thought leadership insight on business and legal matters.

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