No doubt you have heard: US sales of Microsoft Word are banned as of October. Yes, the Word which millions use every day has been ruled to infringe a patent assigned to Infrastructures for Information Inc. of Toronto. This is the dark side of IP. Most businesses think of IP from the light side: protecting their inventions, innovations, creations and "aha moments" from the onslaught of competition. But the dark side is the reality that their work might infringe someone else's work. The dark side is real. It's important to you. You can be shut down and your profits shorn. Don't rely on being able to invalidate a competitor's patent, distinguish your trademark or argue fair use. Don't gamble on trade secrets; trade secrets will be revealed to competitors at trial. Don't profit on purloined trade secrets. Don't rely on not getting caught: your competitors and potential competitors are also watching and the penalty is high. It's worth the few dollars on the front end to make sure that you have the IP worth selling--or going IPO. If it means licenses and royalties, then that is the reality you must face,
Business people often scoff at lawyers that "you have to take risks in business." True, but the risks should be valid risks: venturing the new product, entering the new market, changing up the marketing and ad campaign, leveraging up for growth tomorrow. Unacceptable risks should be those which introduce fines and penalties, complex litigation and jail time. Many businesses rarely think of the dark side, the flip side of their IP: On whom might you be infringing with what consequences? The reality is that if you do infringe, it will be expensive, time consuming and ruinous to your model. They can shut you down and take your profits. Don't consider this an acceptable business risk. Get the evaluations you need.
I know you don't like thinking about IP rights: they're complicated, uncertain and seem to cost you coming and going, for filing and defense. You tend to protect and defend what you can and leave the rest to fate, calling it risk. Don't. You have talked to the lawyers and have got a lesson in costs. A patent can cost $50,000 and up and may yet not issue or may may be invalidated, and the invention may yet infringe. After all the development costs for your goods and services, patents, and trademarks and copyrights are expensive to defend. Many businesses tread skeptically. Many choose to protect their inventions as trade secrets and close their eyes to much of the real world fate of their IP.
In the case of Word, the District Court has ordered Microsoft to pay over $240 M in damages, plus costs and interest. Significantly, the problem is a relatively old patent, filed in 1994. which is infringed by an important but isolated functionality of Word. The cost is negligible to Microsoft and the Court has described a workaround, but think of how an equivalent result could affect you. Think about how quickly you can be shut down and your profits stripped should your product be ruled to infringe, even a seemingly old, obscure patent. Unless you examine your work honestly according to the reality of IP law, you too run the risk of high damages and costs and being shut down. You need to pay those few thousand dollars at the front end before you go out on a limb and have experts examine the real world for patents, trademarks and copyrights which your products and creations might infringe.
Microsoft's news this week should not just have you rethinking the schedule of that 4th Quarter upgrade to Word 2007 but rethinking your IP strategy.
© Copyright 2009. Sigrid Caroline Schroder. All Rights Reserved.
For More Information:
Microsoft ruling technology discussed in Information Week.
British reaction to the situation in The Guardian.
The 5787449 Patent : "A system and method for the separate manipulation of the architecture and content of a document, particularly for data representation and transformations. "
The U.S. District Court Permanent Injunction via DocStoc.com and the Final Judgment via Spoofee.com.
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