15 September 2015 - Joep Meddens

Lawyers indispensable to innovation (and vice versa)

Innovation is as popular as ever. The government has programmes to stimulate it and the private sector keeps hammering on the importance of it. Rightly so: modern society benefits from the profusion of new solutions to the problems it faces. Every business that wants to stay ahead of the competition also needs to keep innovating.

But innovation is impossible without investment, whether it is for the time spent mulling over that one idea in the proverbial attic or for the expenditure required to market a new product or service. Protecting investment is the basis of most intellectual property rights. Disney is a worldwide player thanks to copyright. Unilever would be inconceivable without trademark law, and the patent wars between Samsung and Apple are known to us all. Lesser known IP rights, such as database rights and the related rights of phonogram producers, depend for their very existence on investment: only those who have paid acquire rights. These rights are important, because the basic rule in the Netherlands is that benefiting from another person’s efforts is allowed even if that other person is adversely affected as a result. And ideas are free: only actual manifestations of ideas can be protected. Thus the answer to the question, ‘Can they just do that?’ is, surprisingly, often a disappointing ‘Yes’. This can create problems, particularly when it comes to knowhow. Developing an innovative business model costs time and money. A recent example is the online supermarket Picnic. Co-founder Joris Beckers says, ‘We worked on Picnic for three years. It is a well thought out concept and we have high ambitions for its marketing.’ But if the Picnic model is indeed successful, then Jumbo and Albert Heijn can adopt it themselves. They will obviously have to create their own app, but they’re free to use the idea. That’s if, of course, they have the requisite expertise to turn the idea into an actual product. In such a case it is therefore essential to hold on to the people who have this expertise. Attractive employment terms are obviously a must, but these need to be buttressed with confidentiality, non-solicitation and non-competition clauses. The last of these is all too often insufficiently watertight in practice. Another solution could be to create protected elements around your knowhow: an app, a strong trademark or a copyrighted manual for using the information, for example. Lawyers whose task it is to protect innovation (and the investments entailed) are well advised to think in advance about the best ways of accomplishing this: relying on copyright protection or opting for a design application? Has sufficient investment been made to claim a protected database? Which people are the key to success? And what exactly do the rights cover?  Interdisciplinarity is unavoidable in considerations such as these: a thorough knowledge of intellectual property and a sound comprehension of employment contracts and NDAs are indispensable.But lawyers are not only protectors of innovation, we’re also frequently asked to contribute to it as well. When a hack for PlayStation 3 appeared on the market, lawyers succeeded in obtaining an injunction against its sellers using a creative interpretation of the law. That provided the time-frame needed to take the requisite technical countermeasures. Marketing limits are constantly being explored. Collecting and using big data to predict what we’re going to buy, and when, has raised the inevitable queries about privacy legislation.  Lawyers have to grapple with this because such use offers such a wealth of opportunities that there’s no stopping it. An advertisement placed on a small banner on someone else’s website cannot provide the same obligatory information as one posted on one’s own entire site. Nevertheless, such banners have been used and that called for a solution (which was in fact forthcoming). Viewed in this way, it is clear that an innovative society cannot do without innovative lawyers.