Transcript company value

VALUE DEFENSE
Objective: Defend against actual and
potential actions of competitors
Defense as creative and sustaining process
 Basic economic process: new products,
quality, efficiency, timeliness
 Legal defenses of property
Intellectual Property:
 Patents
 Copyrights
 Trade Marks
 Trade Dress
 Trade Secrets
VALUE DEFENSE--DARK SIDE
(Don't Do These!!!)
 Destroy competitors plants, . . .
 Predatory pricing (below variable costs)
 Buy out best competitors leaving the weak
 Purchase key suppliers and lock out
competitors
 Smear campaigns of competitors'
products
 Disrupt competitors' production facilities
 Obstruct competitors' management
processes
 File nuisance lawsuits
 Spy on competitors' product development
 Hire competitors key employees
 Lock out competitors/exclusive purchase
agreements
 Copy products/services and sabotage in
market
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 Remedies: criminal, antitrust, common
law but due care, security, observation
action needed.
PATENTS
 Federal law and international treaty apply
 Patents filed in Federal Patent Office: About $30K in
costs
 Simultaneous filings in treaty countries common
 Must be defended to have value
 Types
 Utility 20 New, non-obvious, useful 5.8M
 Drug 20* from FDA approval
 Design 14? Ornamentation, no function
310K
 Plant 20 Asexual plant 7.5K Variety 20 Seeds, Agr. Dept.
(years changed to 20 with GATT)
 Utility patents must be new, useful, and not
obvious
 Design patents must be ornamental only
 Many product designs can be copied
because obvious/utility
 Patents may be bought, sold, licensed
COPYRIGHTS
 Federal Copyright office (small cost $100)
 Filing not required, but need filing for remedy
 First tangible expression
 Damages up to $100,000 + fees per instance
 Treaty, world wide, except. . .
 Life of author plus 75 years
 Types: Literary (software), musical, dramatic,
choreographic, pictorial, graphic, sculpture, 3-d
architecture, data compilations
 Excludes product designs currently
 Rental of sound recordings/computer software
prohibited
 Copyrights may be bought, sold, or licensed
TRADE MARKS
 Federal (interstate) and State (local) law
applies
 Strictly territorial
 Use of mark builds rights, must use
 non use for 2 years, abandoned
 Unlimited life, but renewed periodically
 Specific products, not general
 May be licensed provided quality control
TRADE SECRETS
 State Law (uniform act in 36 states,
common law others)
 Formulae, devices, processes, or
information
 Not generally known, secrecy by
reasonable means
 Unlimited life, not filed
 Complaint: employees, spying
 Remedy: Entire profit over a number of
years
TRADE DRESS
Appearance of business premises
and overall impression
Restaurants, service businesses,
retailers
Common law, local only,
interpretation
Emerging area, but developing
quickly