Protecting Your Business: Understanding the Economic Impact of Intellectual Property Theft
As an intellectual property (IP) lawyer with a national practice, I am acutely aware of the economic consequences that arise from IP theft just based on the number of inquiries from IP owners. In today’s rapidly evolving information economy, safeguarding your innovations and creative works has become more critical than ever before particularly for service-based businesses that rely on brand identity and product-based businesses that rely on innovation. In this blog post, I aim to shed light on the gravity of IP theft and its ramifications on local, regional, and national businesses. By recognizing the value of IP and the economic impact of its theft, you can easily cost justify taking proactive steps to safeguard your innovations and protect your company’s future.
What is Intellectual Property Theft?
IP theft not only refers to the unauthorized use, replication, or distribution of another party’s creations, innovations, or proprietary information but also the appropriation of another’s brand identity. This includes copyright violations, counterfeiting goods, patent infringement, trade secret misappropriation, and unlicensed trademark use. When IP is stolen, the rightful owners are denied the ability to profit from their creations, and/or the offending party unfairly profits from the owner’s efforts and expense, frequently leading to significant economic losses and potential long-term damage to the owners’ brand reputation and goodwill.
How is Intellectual Property Considered an Economic Resource?
According to Ocean Tomo’s annual “Intangible Asset Market Value Study,” greater than 90% of the total assets of US businesses listed on the S&P 500 are intangible assets including IP. Thus, IP likely represents a substantial percentage of your business’ assets. Patents not only protect inventions, encouraging innovation by granting inventors exclusive rights for a limited time but they can be significant assets that significantly boost your company’s valuation and creditworthiness. Copyrights safeguard creative expressions, such as literature, music, and software, promoting artistic endeavors and allowing artists and creators to earn a living from their works. Trademarks distinguish brands, enabling businesses to build a reputation and earn consumer trust, thereby driving sales, fostering growth, and developing goodwill. Trade secrets give companies a competitive edge by safeguarding confidential information that provides a unique advantage in the marketplace.
By protecting IP, the IP remains available for businesses to leverage these assets to gain a competitive advantage, attract investors, and generate revenue. Thus, not only is IP a significant amount of your business’ assets, but the ability to monetize IP contributes significantly to your company’s overall economic health and growth prospects.
What Happens to Jobs When IP Rights are Ignored and Intellectual Property is Stolen?
It is generally accepted by historians that one of the major contributors to American technological dominance and the rapid rise of the United States as an economic superpower over the last 200 years has been the Constitutional policy influence of rewarding inventors and artists for their IP contributions to society. Thus, it should be no surprise that theft of IP has far-reaching consequences and a significant impact on national economics including job opportunities. When businesses lose revenue due to IP theft, they may be forced to cut costs to stay afloat. This could lead to downsizing, layoffs, or reduced hiring, affecting employees and their livelihoods. Potentially more egregious, however, businesses may become reluctant to invest in research and development if their innovations are not adequately protected to ensure a return on their investment. Clearly, this reluctance can hinder technological advancements, stifle economic growth, and diminish opportunities for skilled workers.
The Rise of Intellectual Property Theft in the Nation
The digital age has facilitated the rapid spread of IP theft, with online platforms making it easier for infringers to access and distribute creative works without authorization, particularly unprotected works and works missing an attribution or ownership indication. Piracy, counterfeiting, and unauthorized use of patentable technology have become rampant, affecting businesses across all industries.
In response to this escalating issue, businesses must be proactive in safeguarding their IP. Patenting inventions and registering trademarks and copyrights provides legal protection and serves as a deterrent to potential infringers. Additionally, implementing robust security measures and confidentiality protocols for trade secrets can minimize the risk of misappropriation and provide options if theft does occur.
IP theft poses significant economic risks to businesses throughout the world. Protecting your innovations and creative works not only preserves your company’s reputation and market position but also ensures the stability of job opportunities for your employees. By recognizing the value of IP and the potential consequences of its theft, business owners can take proactive steps to secure their assets and foster a thriving and innovative economic environment. Seeking guidance from an experienced IP lawyer can provide valuable insights as to what best to protect in this ever-evolving landscape, enabling your business to flourish and succeed in the face of such challenges.
About Holley Driggs
Holley Driggs, Ltd. is proud to be a Nevada-based law firm focused on making positive contributions to its local and regional communities through the dedicated leadership of its team of more than thirty experienced attorneys. With offices in Las Vegas and Reno, the general practice law firm represents national and international clients on a wide spectrum of business and corporate practice areas including commercial litigation, real estate, natural resources, eminent domain, employment law, bankruptcy, construction, gaming, and technology and intellectual property. The Firm’s shareholders also have broad experience in administrative law, estate planning, probate, and tax law. For more information, please visit www.nevadafirm.com or call (702) 791-0308 for the southern Nevada location or (775) 851-8700 for the northern Nevada location. To learn more about Holley Driggs, Ltd. and its practice areas, visit www.nevadafirm.com.