Top Ten Tips on Intellectual Property Best Practices for Small Businesses
Everyone knows high tech businesses derive most of their value from intellectual property. However, in our digitized world of information overload, few businesses really know how to “separate the wheat from the chaff.” The reality is every business can build and sustain a competitive advantage by properly leveraging its intellectual property. Your legal counsel can add tremendous value to your organization by ensuring proper identification and legal protection for these valuable but intangible assets. The following is our monthly Top Ten Tip on IP Best Practices for Small Businesses.
Tip #8. Ensure Proper Protection Against Employee Misappropriation. Employees get access to proprietary information every day. Today most employees move from company to company in the same or similar industries and competitive markets. In order to prevent an employee from misappropriating your proprietary information and giving it to one of your competitors, each employee should be required to sign an agreement containing some or all of the non-compete and confidentiality covenants described in our prior bulletins. It is possible to obtain these agreements even after an employee is hired or before they depart, so long as there is adequate consideration for the agreement as required by applicable state law. In some states, continued employment is sufficient consideration, but in other states, additional consideration may be required. Ensure that the agreements signed by departing employees do not supersede prior signed agreements which you may want to enforce after the employee leaves your organization. Again, as a reminder, with respect to trade secrets, the best defense to misappropriation is to ensure proprietary information is disseminated only on a need to know basis.
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