media trust workshop brand partnerships
DESCRIPTION
Garry Mills, Head of Trade Marks and Brands at Innovate Legal shares expertise in protecting and valuing your brand, at a Media Trust seminarTRANSCRIPT
© 2012 Innovate Legal Services Limited
Corporate Partnerships
Garry Mills
Head of Trade Marks and Brands
Innovate Legal
Media Trust Brand Protection Masterclass
26 January 2012
© 2012 Innovate Legal Services Limited
Overview
1. Introduction
2. Potential benefits/risks of partnerships
3. Examples of recent corporate/charity partnerships
4. Outline of a partnership
5. Conclusions
6. Case Study
© 2012 Innovate Legal Services Limited
Introduction
Examples of Recent Projects
• collaboration agreement between an environmental charity and well-known retailer, including brand licence
• helping a health charity to create and protect a “certification” logo to be licensed to commercial partners
• Advising a charity on development of a software product and on licensing it to sister charities
• Advising an employment charity on collaboration with a major ISP
© 2012 Innovate Legal Services Limited
Potential Benefits and Risks of Partnerships
Potential Benefits
- revenue- access to partner’s markets, customers and contacts- employee motivation- brand visibility- other benefits
Potential risks
- unsuitable partner / damage to reputation- loss of control of brand- costs- other risks
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Examples of Charity and Corporate partnerships
Case study 1: RNIB and Microsoft strategic relationship:
Source: RNIB website (www.rnib.org.uk)
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Examples of Charity and Corporate partnerships
Case study 2: National Trust and Fired Earth
Source: National Trust website (www.nationaltrust.org.uk)
© 2012 Innovate Legal Services Limited
Evaluating IP / Identifying Partners
What IP does the charity have that could benefit a commercial partner?
• Brand name/logos/slogans etc consider creating a new “bespoke” logo/sub-brand for licensing
• Know-how, content and expertise
• Software and other IP assets
Who are suitable potential commercial partners?
• likely to depend on the charitable sector concerned
© 2012 Innovate Legal Services Limited
Protecting IP
Once the Charity’s key IP has been evaluated, essential to consider the options for protection.
If the Charity’s brand or other IP is not protected:
- Increased risk of 3rd party misuse or “squatting”
- Less attractive for potential partners: concerns about “piggybacking”
Important to ensure that key IP is properly protected to ensure exclusivity.
© 2012 Innovate Legal Services Limited
Protecting IP
There are two forms of protection for IP
- Registered
- Unregistered
For some kinds of IP, unregistered protection arises automatically.
However, the most effective method of protecting IP is by registration.
© 2012 Innovate Legal Services Limited
Protecting your Brand
In particular, registering brand elements is highly advisable:
Enforcing registered trade marks is usually easier and less costly than enforcing unregistered rights.
Absence of protection may discourage corporates from partnering.
Consider protecting key brand elements:
Names, logos, slogans and colour schemes are all registrable
© 2012 Innovate Legal Services Limited
Protecting your Brand
Important considerations:
• Trade marks are registered for specific goods and services
best to protect brand not just for core activities but also for potential partner’s activities
• Trade marks are national rights
UK or international trade mark protection needed?
• Costs of registration
Professional help is advisable
© 2012 Innovate Legal Services Limited
Protecting your Brand
IP Enforcement
Once registered, use the (R) symbol to deter third parties from misusing.
Act swiftly against infringers. If action is delayed, legal rights may be weakened or even lost altogether: “brand genericide” (e.g. ASPIRIN, ESCALATOR and ZIPPER).
© 2012 Innovate Legal Services Limited
Agreeing Terms of a Partnership
Essential to record terms in writing.
Advisable to involve lawyers in drafting agreement.
Expect to negotiate.
The terms of the agreement will depend on the parties’ commercial deal, but many terms are typical...
© 2012 Innovate Legal Services Limited
Standard terms (1)
Subject matter:
- Which rights are covered?
- Important to specify which rights are in/out
Scope:
- Exclusive, non-exclusive or sole?
- Field of use?
- Form of use?
© 2012 Innovate Legal Services Limited
Standard licence terms (2)
Ownership of newly created IP
- who owns and who can use?
Territory
Other restrictions or obligations, e.g.:
- Number of manufacturing sites / products allowed.
- Any obligations on charity to provide assistance.
- Quality /ethical standards
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Standard licence terms (3)
Duration and Termination
- Time limited or perpetual?
- Rights to renew: automatic or conditional?
- Rights to terminate early for breach
Payments
- calculating payments
- payment terms: e.g. guaranteed minimum payments?
© 2012 Innovate Legal Services Limited
Valuing IP
If the proposed partnership involves royalty or other payments:
- what is it reasonable to expect a corporate partner to pay for the use of the charity’s IP
- how to justify the amounts?
Usually agreed by negotiation between the charity and partner.
If parties’ valuations differ, consider expert brand valuation.
© 2012 Innovate Legal Services Limited
Valuing IP
IP valuation
Uses- often used in litigation for calculating damages- used for many years in corporate accounting and taxation matters
Usually carried out by specialist consultants
Can be expensive- only likely to be justified for very significant brand partnerships
By its nature, brand valuation is subjective.
© 2012 Innovate Legal Services Limited
Valuing IP
3 main brand valuation methods:
• Cost approach- cost of creating or recreating the rights (may undervalue charity brands)
• Market approach- estimate value by reference to comparable transactions (may be fewer comparables with charity brands)
• Income approach- earnings approach- relief from royalty approach
Other relevant factors: brand’s track record, strength of the brand etc.
© 2012 Innovate Legal Services Limited
Valuing IP
There are pros and cons with each approach.
The different approaches may well yield different results.
The more information available to the valuer (e.g. comparable transactions), the more accurate the valuation is likely to be.
Comparable transactions in the charity sector concerned?
Ultimately, the right to use IP is only worth what a partner is prepared to pay.
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Outline of a partnership
Other important considerations:
How to identify suitable potential partners
How to locate the relevant individual within an organisation
Questions to ask
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Conclusions and some steps to take now
Have an IP strategy:
- list key brand names, logos, slogans and other intangible assets- ensure these are registered where feasible- tackle infringements
Monitor/record comparable transactions for valuation purposes.
Research carefully potential corporate partners.
Ensure partnership terms are in writing.
Take specialist advice on brand protection and drafting any agreements.
© 2012 Innovate Legal Services Limited
Case Study
Facts:
You are a children’s health charity. You receive an approach from Tesco to take part in a joint campaign. They will produce a “Barnaby Bear” teddy bear with your logo embroidered on the bear’s T-Shirt. For each bear sold, you will receive £1. Tesco want you to agree exclusivity for an initial 3 year term.
Consider:
1) Brand registration/ownership issues2) Payment terms3) Is the 3 year term reasonable?4) Questions to ask
© 2008 Innovate Legal Services Limited
Thank you for listening.
Garry Mills
Head of Trade Marks and Brands
Innovate Legal
107 Fleet Street
London
EC4A 2AB
Tel: +44(0)20 7936 9239
Fax: +44(0)20 7936 9111
Email: [email protected]
www.innovatelegal.co.uk