You want to protect your software from the competition and maintain your advantage. But when it comes to software, what intellectual property rights do you really need?
That’s the question many businesses face as they look to get their commercial software apps off the ground. And when you consider how intellectual property rights have changed over the years – including the current confusion as to what’s really protected in software to begin with – then it’s no wonder why the answer has become such a challenge.
Too many companies get bogged down by it or miss their windows of opportunity. If debating your intellectual property rights decision is holding you back, it’s time to refocus. While failing to launch your mobile app is one way to make sure competitors don’t get their hands on it, it’s certainly not going to make your stakeholders happy.
When it comes to software, you have four basic legal paths to choose from to protect your intellectual property.
You can choose one or two of them that fit your needs.
Or all four.
Or even none.
The fact is that each of these methods protects different parts of your software in different ways. There really is no “one size fits all” solution. Your choice will be affected not only by the type of software you’re creating, but also the risk factors you anticipate from your competition.
In this article, I’ll look at all four of these methods, when you might use them, and why. At the end, I’ll offer up my recommendation for the ONE best way to protect your commercial software today.
1. Trade Secrets and Confidentiality Agreements
The first – and perhaps simplest – way to protect intellectual property is by having processes in place to keep those secrets secret!
While this might sound obvious, many companies struggle to control the flow of communication both internally and externally. That’s because they don’t have the right processes in place to protect them.
Are your employees specifically trained in how to handle confidential information? And is it clear to them when something is confidential? The more education you invest in showing employees how to protect intellectual property, the safer your intellectual property will be.
Communication and training are the keys to guarding any trade secrets within a company.
Outside the company, confidentiality agreements can be put in place with business partners, customers, and anyone else privy to your trade secrets. The most common form in software development is the Non-Disclosure Agreement, or NDA.
An NDA is a legal acknowledgement that confidential information is being shared but will not be disclosed to anyone outside of the agreement. There are no costs involved, other than the fees your lawyers charge to draw it up, and there are even free templates available online if you don’t need much customization.
While it used to provide legal recourse in the event of a confidentiality breach, the most significant aspect of an NDA is that it provides a paper trail of what you were protecting and when. This could be instrumental in filing for trademarks or patents down the road, as well as in dealing with infringement claims.
A trademark is good for protecting your product’s name, slogans, and logos.
Why do you need this? Consider what happens when your new commercial software app becomes wildly successful. Competitors will want to copy you – and they will, as closely as they’re able. Some will go so far as to use names and create logos that look almost identical to yours, trying to mislead your customers to their apps instead.
A trademark is designed to stop that sort of copying. When your name, slogans, and logos are trademarked, competitors are much less likely to steal them. They might still copy your ideas, but your advertising and brand awareness will benefit you, rather than some cheap imitator trying to pose as you.
A trademark requires a small filing fee, but research and legal fees can make it a significant investment. It can take over a year to complete the process in some cases, although your application provides an important timestamp that could protect you later on.
Patents are what most people think of when it comes to protecting intellectual property rights.
That’s because patents have been used to protect products from competition for literally hundreds of years. Venice first issued patents in 1450. And in the United States, the U.S. Patent Act was made law as early as 1790 to protect inventors from patent infringement.
In modern times, software has been considered a product for that purpose, and patents were an important piece of the software industry. But in recent years, the lines have become blurred for many reasons. Reusable code from vast code libraries – built into virtually every software application nowadays – has complicated the issue of patent infringement.
And even when patents are obtained, enforcing them is a whole new challenge. Issues of piracy, globalization, and determining what exactly makes your software product different from the competition have locked up courts worldwide. So while you can still obtain a software patent, it can take 2-3 years and cost over $20k to complete the process.
There are commercial software cases where I would recommend a patent application. But for the most part, legal trends are finding too many loopholes to make software patents worthwhile.
4. A Category of Intellectual Property Rights You Probably Don’t Need: Copyrights
Copyrights are used to protect written materials from being copied. Strictly speaking, everything you write is copyrighted – filing for one simply provides legal proof and documentation.
A copyright will not protect your software. I only include it here because many people think of copyrights when they think of intellectual property. You can’t just print out all your application code and copyright it – nor would you want to.
What you can copyright are the written and creative materials related to your software app. Instructional guides and videos, marketing literature, video scripts, and even product jingles can be copyrighted. But whether or not it’s worth even the token investment to file for each of those materials will depend on the circumstance.
The ONE Best Choice When Pursuing Intellectual Property Rights:
If your way is still not clear, I invite you to take advantage of a free consult with Ascendle. Every situation is different, and your ideas may need more protection than most.
But in the vast majority of cases, the ONE best choice I recommend to protect software intellectual property rights is to utilize trade secrets with confidentiality agreements.
Recognizing trade secrets and educating your team on how to protect them are two of the most important first steps you can take.
Confidentiality Agreements – aka NDAs – allow you to work with the partners you need for your mobile app’s success. These documents are best when customized to your specific situation, and when they reflect a two-way communication process between you and your partners. This kind of flexibility gives you the means to protect your intellectual property with each individual relationship.
An appropriate NDA can even be signed before your very first conversation on day one … without any need for other paperwork, fees, or filing.
The other three methods of intellectual property right protection can still be applied if desired. And in many cases, they should be. But a good confidentiality agreement up front allows you to move quickly while shielding your trade secrets from some significant risks.
Editor’s Note: This post was originally published in June 2016 and has been updated for accuracy and comprehensiveness.