New entrants should be cautious, protect ideas

While large food and beverage manufacturers in South Africa are generally advised by in-house counsel, intellectual property law firm Spoor & Fisher Senior Associate Zama Buthelezi says it is important for smaller players in the industry to familiarise themselves with their intellectual property rights.

She says there are various avenues available through which small business owners can protect their ideas before attempting to monetise them.

“As an entrepreneur, the material manifestation of your idea is your business and future. Therefore, you need to make sure that you are adequately protected from copy cats, where it is possible,” advances Buthelezi.

The tools available to protect a businesses’ intellectual property include trade marks, copyright and patents.

While trade marks deal with names, slogans, logos, short phrases, and shapes such as multinational beverages company Coca-Cola’s bottle, copyright covers certain creative works, including literary works, such as the wording of recipes, photographs, as well as logos.

Recipes can also be protected by patents. For a patent to be granted for recipes, the recipe has to be proven to be useful, novel and inventive. As a result of these requirements, Ms. Buthelezi says it could be difficult to obtain a patent in the food and beverage sector (for a recipe). Obtaining a patent in this sector will be easier if the subject of the patent concerns actual processes or equipment involved in manufacturing a food product.

Recipes, such as the Coca-Cola formula, are protected as trade secrets. Trade secrets require a lot of work – they are mostly sustained by using contracts, such as nondisclosure agreements (NDA), when employing staff. If an employee reveals a trade secret, that is a breach of contract and legal proceedings can be instituted against them.

“Trade secrets work well when considering how far Coca-Cola has come as a business, but trade secrets are effective only as long as they are kept secret.” That said, there are benefits to trade secrets and that is you can keep your monopoly for as long as the secret remains unexposed. Obtaining a patent, on the other hand, affords you a monopoly for a limited term of 20 years.

She advises that when a company’s intellectual property is infringed by a third party, its first step often involves serving the offender with a letter demanding that they cease the use of a trade mark or copyright specific to the company before taking further legal action. The offender’s reaction to the letter often determines if legal proceedings are required to be instituted.

Meanwhile, Ms. Buthelezi highlights that counterfeit products, although not as abundant as in the fashion industry, are also found in the food and beverage sector and cites counterfeit alcohol in Zambia.

“Trade mark infringement is a daily occurrence in South Africa. Some trade mark infringement matters are settled outside of court. If a trade mark matter is heard in court and a court finds that a trade mark has been infringed, the court could issue an interdict forcing the offender to never repeat the offence again.”

Ms. Buthelezi says that logically speaking, infringement of intellectual property often occurs when products become successful and people hope to take advantage of that success instead of working to make a name for themselves.

“If you have a product, it is important to consider what can be protected by law. You might not realise the importance of protecting your intellectual property initially, and you may only be alerted to take active steps to protect your intellectual property only once your product gains a following and catches the interest of a copycat,” she concludes.

This article was first published in Engineering News.

Date published: 27 August 2019
Author: Spoor & Fisher

Tags: intellectual property trade marks trade secrets copyright patents