You know where your money and investments are and whether they are protected and paying dividends, but can you say the same about your intellectual property? An IP audit can help you identify your IP, manage it and use it to protect your business or create a revenue stream.
In an IP audit your intellectual assets are reviewed to determine what they are, and whether they are protectable by patents, trademark or service mark registrations, copyright registrations and/or as trade secrets. If these assets are protectable, an IP audit can help determine whether they are properly protected through one or more of the available vehicles, taking into consideration your business model or plan and overall business strategy. Often, an asset can be protected through more than one vehicle, for example through design patent and trademark registration, to optimize protection.
An IP audit can encompass any one or all types of IP and can include the IP itself as well the processes and procedures you have in place to identify and protect your IP. We have found that some clients have detailed processes and procedures while other clients have much less rigorous systems in place. There is no one system that is right or wrong. Rather, the most important consideration is that the system is commensurate with the importance of IP to your business.
One of the benefits of an IP audit is that it may help you identify IP, and more specifically patents and trademarks/service marks, that are no longer central to your business model. In certain instances, these assets can be monetized by sale or licensing.
An IP audit can also help you understand the scope of licenses that you may have in place. Since licenses often have terms that extend over a period of years, clients often don’t know what licenses they have in place and the rights and obligations that they have under these licenses. As such, a periodic review of licenses, both in and out (that is as licensor and licensee), and a listing or spreadsheet with certain basic items of information, are helpful to manage a license portfolio.
Another area that is often overlooked is agreements with third parties with whom you may work in creating your products, providing your services and running your business, including outside programmers used to create any custom software used to run the businesses. These agreements, like licenses, should be centrally maintained and periodically reviewed and updated to keep up with the state of the business and to ensure that the business owns sufficient rights.
You might wonder where to start. Put together a listing of, and gather copies of, all of your hard IP assets, such as patents, trademark and service mark registrations, copyright registration, licenses and other agreements. With those in hand, think about your most important product lines and services and prioritize. With the help of a professional familiar with the intricacies of IP, such as your IP attorney, an audit can be carried out with a focus on the important aspects of your business.
An audit does not have to cover everything at once, but should focus on your core business. Narrowing the scope of the audit, if it makes sense, can make an otherwise overwhelming task more straightforward and manageable.