I recently spoke with an in-house IP lawyer at a high-tech hardware client that does business all over the world, mostly in emerging market countries with weak intellectual property rights and protections, including China. When it comes to protecting their IP, this company employs what he calls a “Swiss Army Knife approach,” meaning they do “everything and anything” they can do. Specifically:
- Don’t do business with bad people or bad companies, who are far more likely to try to steal your IP. Research those with whom you may do business. See Foreign Company Due Diligence. He noted that the “less impressive the legal system, the more impressive must be your due diligence.” 100%.
- Register “anything and everything” that makes sense to register and do so in every country in which it makes sense to do so.
- Do not reveal to anyone what does not need to be revealed. This includes to employees. And get confidentiality and trade secret and non-disclosure agreements in place protecting what is revealed. As they say in the government to wave off pesky questions, “that’s need to know.”
- Constantly update the technology so that when someone does copy it, they are copying an older version. Educate your customers on how to distinguish between the older and newer versions and why they should prefer the newer better versions over the older versions. To this I would add educating your consumer on why it makes sense to avoid counterfeits in the first place, and make it easy for consumers to determine if a product is genuine or not (without, of course, revealing sensitive design information that would make counterfeiters work easier).
- Act aggressively at the first sign of an IP or trade secret violation. He said he “could not even count the number of times his company had nipped a problem in the bud by having acted quickly.” See Cease and Desist Letters to Stop International Counterfeiting.
- Guanxi. His word, not mine. He said that in addition to all of the above, one of the most important things is having good relationships with your employees and your customers and the governments in the countries in which you operate because having this create “karma” (again, his word, not mine) that helps to protect you.
I like it, not least because it so closely matches my own Five Tips for Protecting Your IP from China.
What do you think?