4 contemporary challenges of intellectual property law

It’s no secret that innovation capability is a defining factor in the success and differentiation of a company in today’s highly competitive market. One essential tool to achieve this is intellectual property law (IP), which provides businesses with the necessary protection for their innovations and brands. However, effectively managing and utilizing these intangible assets presents some challenges.

On the other hand, if you own rights to intellectual works (audiovisual, musical, literary, etc.), you’ll know that gaining control over their exploitation by third parties and their distribution in the digital environment is quite challenging. Below, we offer a brief analysis of four contemporary challenges of intellectual property law that you should consider.

Management of the patent portfolio, essential for protecting intellectual property rights

A robust intellectual property portfolio is crucial for protecting innovations and maintaining a company’s competitive advantage. However, not all intellectual property automatically generates value, as there are intellectual property patents that, for various reasons, are not utilized, underscoring the importance of strategic and selective management of the IP portfolio.

For an IP portfolio to be truly valuable, it must protect existing product lines and enable the company to gain a strategic edge over its competitors. A research and development (R&D) team should be well-informed about intellectual property trends and unexploited spaces in their industry. It is essential to have an innovation management process that provides continuous feedback to researchers on the feasibility and potential value of their ideas.

Using the patent portfolio to achieve broader business objectives is synonymous with preserving your intellectual property rights. This strategy should include identifying patents that secure protection for current and future product offerings and those that neutralize competition. Additionally, consider whether other patents are suitable for licensing to generate profitability.

A consolidated and strong patent portfolio not only offers a competitive advantage but also provides a decisive defense in case of infringement lawsuits. If managed well, companies can consider licensing to resolve intellectual property conflicts favorably with competitors.

Proper management of lawsuits is crucial to defend intellectual property rights

Certainly, intellectual property lawsuits pose a significant risk for companies, especially those brought by competitors or a non-practicing entity (NPE), commonly known as a patent troll. These lawsuits can result in considerable financial losses and damage to the brand’s reputation.

To manage these risks, companies can conduct freedom-to-operate (FTO) assessments to identify patents that could threaten the launch of new products. By adjusting products to avoid infringement or negotiating licenses with patent holders, companies can prevent costly litigation and preserve their reputation.

Moreover, to prevent litigation in the supply chain, it is essential to include intellectual property indemnity clauses in contracts with suppliers. These clauses can protect the company in case suppliers infringe on third-party IP rights.

Digital media dissemination, a complex challenge

Undoubtedly, one of the most significant challenges facing intellectual property law in the digital age is the dissemination of intellectual works (audiovisual, musical, and literary) and their accessibility on online platforms such as YouTube, Spotify, Facebook, Instagram, and TikTok. Truth be told, regulation in this area has been fragmented and often ineffective, even within the European Union member states, stemming from the lack of a uniform regulatory framework. The most commonly used strategy by rights holders to curb the illegal use of their works on the Internet is the “notice and takedown” system. Originating from the United States, this mechanism allows rights holders to request online service providers to remove infringing content, thereby shifting liability away from the user.

However, this solution has its limitations. Rights holders bear the burden and costs of detecting illicit content in the vast digital landscape. Even when they succeed in getting protected content taken down, they face the issue that it can be re-uploaded through other links or by other users. Moreover, “notice and takedown” is a reactive mechanism that does not guarantee income for rights holders, as digital service providers have been slow to obtain licenses, taking advantage of the legal framework’s current “immunity.” At ISERN, we have advanced technological tools in brand protection that help identify these infringements in the digital environment.

This situation has created a significant “value gap” between the substantial revenues digital platforms derive from exploiting intellectual works and the inadequate compensation rights holders receive for the use of their works. This gap is stark considering that these contents are the raw material of such services and the main source of their revenues.

Directive (EU) 2019/790, legal tool for fair digital dissemination

Regarding the above, we find it pertinent to mention the Directive (EU) 2019/790 on copyright and related rights in the Digital Single Market. This legal instrument was introduced by the European Union to address the aforementioned value gap. It was also transposed into Spanish law through Royal Decree 24/2021 of November 2.

This directive represents a significant advancement in intellectual property law, as it finally harmonizes the contractual framework between authors, performers, and the operators of their works or performances, including broadcasters, content providers, or major digital platforms.

In particular, Articles 18 to 23 of the Directive establish new rights and aim to strengthen the position of authors and performers in their contracts with these platforms. One of the main novelties of the directive includes the right of authors and performers to receive fair and proportionate remuneration for the exploitation of their works and performances. This seeks to correct the current imbalance where digital platforms derive significant economic benefits while creators receive minimal or no compensation.

The Directive also introduces measures to improve contractual transparency, obliging platforms and other content exploiters to provide authors and performers with detailed information on the use of their works and the revenues generated. This enables creators to better assess the value of their works and negotiate fairer contracts.

Is intellectual property in conflict with Artificial Intelligence?

On the other hand, the rapid advancement of artificial intelligence (AI) is transforming numerous fields, and intellectual property (IP) legislation is no exception. These developments pose new challenges and legal questions, especially in the realm of intellectual property law and the identification of the inventor in inventions created by AI, known as AI patents.

One of the main issues in this area is the patentability or registrability of works or inventions created by AI machines. The question arises of who should be recognized as the author or inventor: the AI machine that generated the invention or the human who programmed and trained such machine? This issue has started to concern intellectual property offices and courts internationally. Despite advancements, AI has not yet reached a level of autonomy that makes human collaboration completely unnecessary in these creations.

Regarding this topic, you can read our dedicated article on the relationship between Artificial Intelligence and Intellectual Property for more information.

At ISERN, we understand and tackle the challenges of intellectual property law

We have 100 years of experience in the registration and protection of trademarks, patents, designs, and works eligible for copyright. In this regard, we design innovative strategies for the effective protection of your intangible assets, based on Legaltech.

We have more than 150 expert professionals. Our leadership is confirmed by managing over 350,000 cases and serving more than 40,000 clients worldwide. Contact us and visit any of our 12 offices in major cities across Spain. We provide efficient support in addressing current challenges in intellectual property law!

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