Ways to Stop Employees from Stealing Your Intellectual Property

Written by Guest Contributor on The Prepper Journal.

Editors Note: An article from Preston Felix to The Prepper Journal. The subject of intellectual property rights has been in the news a lot lately with it being a cornerstone of trade negotiations with China, the worlds biggest violator of trademarks. So this timely information should be of value to business owners and employees alike.

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Companies that focus on production, ideation and Research & Development (R&D) have always struggled with privacy of information. The larger your enterprise becomes, the more vulnerable you become to leaks of information, theft of Intellectual Property (IP) and other illegal activity.

Studies have shown that China is the world’s largest thief of IP from US companies, with US company losses ranging in the hundreds of billions. The reason for this is simple – a lack of supervision and regulation makes it easy for valuable information to slip by unnoticed. So how can you circumvent that shortcoming and actually protect your IP from employee theft and manipulation?

A Common NDA

Non-Disclosure Agreements (NDA) have become the norm with large companies and startups alike. Unfortunately, the only way to truly step in front of information theft and leaks is to legally put your employees on notice of the consequences of violating policy.  What this means is that your legal department should draft an NDA that serves to remind everyone of the importance of IP to your company.

Anything that is created inside your office and serves to satisfy one of your projects remains your company’s property. This NDA would apply to everyone on staff, including you, and any outside services employees and management, such as janitorial, maintenance or security, who have access to your property. As an employer, with everyone compelled to participate, no eyebrows will be raised and everyone should willingly sign the NDA concerning your rights as the IP holder. Most companies make this a condition of continued employment.

A “company” cannot “create” anything by itself – it’s a brand and a set of offices. The employees that work for that company create new IP for the clients of said company – this doesn’t mean that it’s theirs by right. Employees have forfeited that claim of ownership by accepting monetary compensation as a condition of their employment. A common NDA is one of the easiest and least stressful ways to enforce IP protection within your staff and stop employees from leaking anything accidentally or otherwise.

Case-by-case Agreements

Sometimes a big client will come to your door and ask for special treatment. Specially-designed NDAs and privacy agreements serve to emphasize the importance of the IP in question. Breaching the privacy agreement of large brands such as Nike, Coca-Cola or Disney can effectively cost you and your company its livelihood.

Large companies often insist that their NDA be used. As a business you have to be willing to review these and either accept them as written of enter into negotiations to modify them to your mutual acceptance. Drafting a modified and properly executed NDA agreement for specific clients is a normal occurrence in business. People that will work on sensitive and need-to-know projects should fall under a more detailed umbrella, your modified NDA that addresses all parties concerns.  According to conventional wisdom, cyber security breaches and leaks are the number one culprit of IP theft so adding specific clauses that concern specific information is also a good idea.

Remember that every employee wants to keep their jobs safe and intact – no one will risk getting fired over a small leak of information. It’s also a good idea to ask your clients about any particular details they would like to emphasize or if they have an NDA of their own. Using your client’s specific NDA for outsourcing and third-party content creation is sometimes the smartest way to go, but always have your trusted legal counsel review and approve it for use.

File for Copyright Protection

Government and international copyright protection is one of the most secure ways to protect your IP. Filing for IP copyright protection as soon as something has been created or iterated in new ways will your best safety measure in ensuring that piece of information stays within your offices. The reason for this is because employees then risk government penalties, prison time or public expulsion from the company when they leak information. (Unless they are a part of the government, like the FBI and leak stories to their contacts in the press, but they are special, and above the law.)

The copyright protection request can be made internally and sent to your legal advisers or filed directly to a government body.

Copyright protection can be indefinite or set for a number of years after which you will have to resubmit the paperwork. If you fail to do so, your IP will be left out in the open and if anyone steals it they won’t fall under any scrutiny or legal precautions. Keep a close eye on your copyright dates and make sure to update them regularly.

Emphasize Your IP in-house

Employees that sign NDAs tend to forget they signed them. Others start feeling as if the NDA is just another document to be signed as a member of your staff. However, both cases open large holes in your IP security. Make sure that your managers emphasize the importance of intellectual property inside your company, and deliver timely reminders.

Handing out pamphlets and guidelines about the NDA in your company is also a good way to nudge your employees in the right direction. If the majority of your staff embraces the IP privacy rules enforced within your company, the rest will follow suit.

Don’t let negligence and “unwritten rules” guideline your IP protection policies. It’s unprofessional and dangerous. Worst of all, it will take only a single breach of client privacy to tarnish your reputation.

Use State Law to Your Advantage

While it can be seen as a rigorous means of IP protection, state law is sometimes the best bet. Depending on the type of work you do (private or government sector), state laws can help you out in a big way. Consult your legal department about the privacy of information and IP in your local state or country.

Most European and all of the US states have very strict and actionable laws concerning intellectual property information falling in the wrong hands. Even with that in mind, copyright infringement and IP theft losses range in billions of US dollars every year. This type of protection will ensure that your information stays in your company even if everyone knows about it – state laws put teeth in your response to violations.

This doesn’t mean you should frighten or coerce your employees however. Make sure that they are aware of your intentions to protect your clients’ privileges, trust and IP. After all, the more reliable you become with protecting IP from leaks, the more lucrative you will become to potential clients down the road.

In Conclusion

The moment you create something unique, not-before-seen, a product, service or process, people will want to understand it and feed off your success or copy it and compete with you. In today’s world you have maybe 3-months before a competitor will show up in your market space. Ironic because to trade-mark, copyright or patent your IP takes, at best 3 months, typically longer. It is a constant race to stay ahead and a constant expense to do your due diligence and make sure your IP has not been hijacked. The price of doing business in our current world.

Tread carefully, differentiate IP theft from “inspiration” when you see a product similar to yours. Chances are that you have created something new and exciting on the market that others are simply trying to replicate. It is a fine line.

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