Intellectual property is often the foundation of emerging enterprises, so owners and managers of many small and growing companies focus their energies and resources on its development and protection. In fact, the balance sheets of many emerging companies show that their intellectual property is their most valuable asset. If competitors were free to copy and use those ideas and inventions, innovators would, in effect, be sacrificing their stock-in-trade. It is, therefore, critically important for companies to take steps to protect customer lists, patents, trademarks, proprietary systems, methods, processes, products and operational techniques. As a first step, every innovator needs to understand the definition of the various legal components of intellectual property.

There are several classifications of intellectual property and correspondingly different legal protections. To determine which legal mechanisms should be protecting your company’s intellectual property, consider the following introductory descriptions and make sure to consult the appropriate experts.

Patents. A patent grants an inventor the right to exclude third parties from making, using or selling the subject matter of his or her invention throughout the United States for a defined period of time. Utility patents, which are the most common type of patents granted by the U.S. Patent and Trademark Office (USPTO), protect new, useful and non-obvious processes, machines, compositions of matter and articles of manufacture for a period of 17 years. Design patents, which stay in effect for 14 years, cover new, original, ornamental and non-obvious designs for articles of manufacture. And plant patents, which USPTO issues for certain new varieties of plants that have been asexually reproduced, are in effect for 17 years.

Trademarks, Servicemarks, and Tradenames. The Lanham Act of 1946 defines a trademark as any word, name, symbol, or device adopted and used by a manufacturer or merchant to identify and distinguish its goods from those manufactured or sold by others and to indicate the source of the goods. A servicemark serves similar purposes, but it protects the advertising and marketing of services rather than products. A tradename is the name a business or other organization selects to identify itself as a distinct entity. While it’s true that some companies do use their tradenames as trademarks or servicemarks, it’s important to treat the two varieties of intellectual property differently. A company cannot assume that its name has automatically acquired trademark or servicemark rights simply because it has been offering its goods or services under its particular company name. Tradename protection, which lasts 10 years, is granted by the USPTO.

Copyrights. Copyright protection is available to authors of original literary, dramatic, musical, artistic and certain other intellectual works that are fixed in any tangible medium of expression. In most cases, the owner of a copyright from the USPTO has the exclusive right to or authorize others to reproduce and/or prepare derivative works, distribute copies, perform or display the copyrighted work, during the author’s lifetime, plus 50 years. For more detailed information on this topic, read the article in this series entitled, “Copyright Law: A Strategic Primer.”

Trade Secrets. A company’s tradesecrets may comprise any information that it treats as confidential and proprietary and uses to give it an advantage over competitors. Rather than securing trade secret protection from a government agency, a company must define the scope of its trade secrets through its contractual and fiduciary relationships with its suppliers and customers.