Why IP protections don't work for SMEs

One business owner says patents are a waste of time and money for SMEs, and is instead looking at other ways to protect his intellectual property (IP).

Mike Lelliott, the co-founder of Saint, which manufactures and retails what it describes as ‘unbreakable denim’, told My Business that SME owners shouldn’t waste their time on patents.

“Frankly speaking, having been down the path of IP protection in the past with other companies I've built up, especially for the small business it's fraught with delay, because it takes an extended period of time to register a patent. And then if you believe it's in breach, it's stupidly expensive to defend,” he says.

“So we decided to protect ourselves through innovation and to beat the market, rather than diving into the legal space.”Wet padlock opened with a key

According to Mike, it is not just Saint’s products which are unique, but also the production processes that go into making them. As such, he says that rather than waiting for a patent to be registered, his business is able to market itself as the owner of the product and process before any competitors emerge in the space.

“We dove in and worked out how to spin a yarn, and we've gone back into I suppose the history of fabric-making and found particular processes and readapted them to making this new material,” he says.

Mike says Saint also focused on creating bespoke intricacies within the manufacturing process to help protect its brand from knock-offs.

“So the way you stamp this is a different way, or the way the button depresses is a different way, so it hasn't been done before and it doesn't need registration.”

Patents are often a prickly question for start-ups and small businesses.

As well as the troubles outlined above by Mike, Dan Brush – head of intellectual property and ICT at law firm Colin Biggers & Paisley – says two other sticking points are that in exchange for obtaining a patent, the patent owner must publicly disclose how the invention works, and that patents granted in Australia do not provide worldwide protection.

“Patents are granted on a country-by-country basis. A patent granted in Australia does not provide protection outside of Australia. However, there are treaties between countries that allow for group applications in multiple countries,” says Dan.

“To be successful, a patent application must demonstrate that the invention is different in some way to existing technology, and that the difference derives from a new idea, which is something additional to the combination of previously published information or background knowledge.”

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