A difficult economic climate has both positive and negative effects on the intellectual property (IP) industry.
Budgets for research and development are slashed; investment in commercialising innovation is hard to find; and there is a reduced consumer demand for the latest technology. Simultaneously, in the creative industries, the advertising budgets that drive trade mark and branding work are always the first to be cut, while the same consumers who spend less on gadgets are also spending less on films, music and books.
Intellectual property assets, however, retain their value. Insolvent businesses may have IP assets, which can be (and more than ever are) realised by liquidators.. At the same time corporations seek to create complex group structures with cross licensing arrangements to shelter key intellectual assets safe from day to day trading risks – either of their own or their collaborators.
This last area of work presents significant risks for lawyers practising IP as these license arrangements may well come to be tested in court against a future liquidator or administrator. A recent decision in the case of Oxonica v Neuftec shows the danger of poor drafting where the Judge Peter Prescott stated that:
"The more I read the document, the more I think: 'A little learning is a dangerous thing'…. The draftsman was not very familiar with patent practice and terminology…. He was not always clear in his own mind what he was doing and, when not clear, allowed his word processor to do his thinking for him... The result is business uncertainty and costly litigation"
Credit crunch or not, whether exploiting intellectual property or protecting it, it seems that when it comes to IP legal advice – you still get what you pay for.
Paul Carlyle is a partner specialising in media and technology law at leading UK law firm Shepherd and Wedderburn LLP.