Legal Journal

Importance of Setting Up an IP Strategy in Startups

Almost every entrepreneur carries out activities such as hiring employees, developing products, finding investors and setting up marketing strategies while starting a startup company. Besides these setting up an IP strategy is also one of the important things to protect the company and the investment. Protection of trademarks, designs, patents and copyright should be considered for a well prepared IP strategy.

Trademark may consist of any kind of sign such as words, shapes, colors, letters, numbers, sounds and shapes or packages of goods. A genuine trademark is important to distinguish startup’s goods and services from its opponents’. From viewpoint of the consumer/end user; a distinctive and recognizable trademark design also makes the startup company preferable. On the other hand, from viewpoint of the opponents; since they try to attract same consumer group, they might use same or similar signs with startup’s trademark to change the balance in their product’s favor. However, trademark registration; prohibits competitors from both registering same or confusingly similar trademarks and taking unfair advantage of similarity by using these same/similar signs on its own goods/products. Therefore; name, emblem, logo of startup or product or shape of product may be registered as a trademark if it fulfills required conditions. A trademark may be registered for a period of ten years from the date of filing of the application. Registration may be renewed for further periods of ten years without any limitation.

Design is the appearance of the whole or part of a product or the decor on the product which derives from the various characteristic features such as lines, shape, color, form, material or surface texture. Innovation and distinctiveness are required to register a design. On the contrary to trademarks, registered designs do expire. A design may be registered for a period of five years from the date of filing of the application and it may be renewed for further periods of five years but registration period is limited to twenty-five years in total. From the first day of startup and during the development process; registering the products, which have innovation and distinctiveness features, as “design” is important to prevent unfair intervention of opponents. This is because, without permission of the designer, third parties cannot produce, release to market, sell or import the protected design or use it for commercial purposes. It is further expected that the design developed at the initial stages of startup will differentiate from its initial state. Thus, it is recommended to evaluate filing a design application for new features of the product developed in time.

On the other hand, products developed by startup might have the characteristics of the invention and so might be subject to patent protection. An invention used in any field of technology shall be granted patent, provided that it has feature of newness, has inventive step and is regarded as being applicable in industry. Like other subjects mentioned under IP strategy, patent protection also serves for protection of startup’s invention/product from opponents and preventing violation of rights.

Finally, employees or third party contractors might produce outcomes for startup such as books, music, catalogs, software, web site designs, videos and photographs which have characteristics of its author. These outcomes shall be considered as Work pursuant to Law on Intellectual and Artistic Works (“Law”). Author has copyright on its Work which shall be protected non-proprietary. If the author of Work is an employee of startup, the company directly will be the copyright owner because of the specific provisions of Law. On the other hand, in case of third party contractors, financial-copyright agreements should be executed to obtain copyright of Work. In cases where there is no duly executed agreement for copyrighted Works, it is possible to be confronted with claims regarding copyright infringement. In cases where copyrighted Works of startup is used by third parties without proper licenses, this time startup shall have the right to file infringement and compensation claims against such third parties.

Consequently it is important for startups to set up an IP strategy from the very beginning in order to protect its products, services and Works against violation claims of third parties. 

Av. Nihan Malkoçer