Why do contentious IP issues crop up during a financial crisis? - Kuits Solicitors Manchester
  • Insights
  • Why do contentious IP issues crop up during a financial crisis?

Why do contentious IP issues crop up during a financial crisis?

Why do contentious IP issues crop up during a financial crisis?

26th June 2020 - Published by Kuits IP team

Whilst we do not have a direct comparison in the legal sector to the events following the current pandemic, there are circumstances, such as financial instability in the markets, which make the situation similar to that of a recession.

In general terms, there tends to be an increase in litigation as the number of disputes between laid-off employees and employers goes up, along with the number of claims to collect any money owed.

More specifically, when it comes to Intellectual Property (IP), the rights have the dual benefit of being able to be used as a sword, to attack opponents in the market place, or a shield, to protect the organisation, which makes them a valuable asset during times of financial instability.

At Kuits, we have found that the increase in contentious IP issues may arise from one of the following reasons:

  • The length of lockdown has led to a number of people with the time to pursue business ventures that they were not able to do so in “normal” circumstances. Starting a new business brings with it the difficulties of establishing a trading name, company brand and setting up the various social media platforms for promotion. It is usually here that problems arise for a new business as it is important that these elements do not infringe the IP rights already held by existing businesses. When the new company sails a bit too close to the wind of another business, whether knowingly or not, it is here where an established business may defend the IP rights held by it;
  • A number of businesses now face a period of restructuring which would include making employees redundant. When looking for new jobs, these employees are likely to remain in a similar sector to the one in which they were previously employed. In some circumstances this leads to employees taking information with them to their new employment, on the basis that such information may help them in the future. If this occurs, and depending of the kind of information taken, the employer may be able to pursue a cause of action which is a combination, or a single action, of copyright infringement, a breach of confidential information and a breach of database rights;
  • There are also some circumstances where as a consequence of the financial markets that IP agreements between parties have come to a premature end; an example of this is a collaboration agreement between a university and a third party. Problems can arise in these situations as the terms of the agreement remain unfulfilled and payments remain unpaid to one of the contracting parties.

It is true that times of financial hardship tend to drive the entrepreneurial spirit in individuals but if you are unsure about the steps available to you when it comes to IP, either as a new business or an established company, contact Humna Nadim in the Kuits IP team at humnanadim@kuits.com or on 0161 838 8163.

Subscribe to our mailing list