In the business world, various intellectual property (IP) investigations—such as patent, utility model, design, and trademark searches—are routinely conducted to ensure that a company's activities do not infringe upon the rights of others. Among these, Freedom to Operate (FTO) or clearance searches are particularly vital in product development and sales, serving as a critical component of risk management.
Patents, designs, and trademarks grant their holders exclusive rights, prohibiting unauthorized use by others. Even unintentional infringement can lead to serious legal consequences, including injunctions and claims for damages. Conducting FTO searches proactively helps identify potential IP conflicts, allowing businesses to avoid costly disputes and maintain uninterrupted operations.
Infringement assessments are specific to each business entity. For instance, if a manufacturer supplies a product to a retailer, and that product infringes on an existing patent, both the manufacturer and the retailer could be held liable. This underscores the importance of conducting thorough IP investigations across all levels of the supply chain.
With the rise of e-commerce platforms like Amazon and Rakuten, it's easier than ever to sell products online. However, these platforms often respond swiftly to reports of IP infringement by suspending listings or accounts. Such actions are taken to mitigate the platform's own legal risks. Therefore, sellers must perform comprehensive IP checks before listing products to avoid disruptions.
Additionally, contracts with manufacturers or wholesalers may include clauses requiring confirmation that products do not infringe on third-party IP rights. Failing to adhere to these clauses can result in contractual disputes and legal liabilities.
To operate safely, businesses should actively conduct IP investigations. In some cases, filing applications—such as trademark registrations—can serve as a preventive measure. For example, submitting a trademark application allows for examination by the patent office, which can help identify potential conflicts and reduce risk.
Contracts often include provisions requiring parties to confirm that their products do not infringe on third-party IP rights. However, clauses that demand a "guarantee" of non-infringement pose significant risks. Since infringement determinations are ultimately made by courts, guaranteeing non-infringement can expose a company to substantial liabilities. It's crucial to consult with IP professionals when drafting or reviewing such contracts.
Effective IP strategy requires expert guidance. Professionals can assist with:
Conducting infringement investigations (FTO/clearance searches) for patents, designs, and trademarks.
Evaluating the viability of applications and developing strategic IP utilization plans.
Reviewing contracts for potential risks and ensuring appropriate language is used.
By leveraging professional support, businesses can confidently navigate IP challenges and focus on growth. Feel free to reach out for assistance tailored to your specific needs.