Ownership of intellectual property

This article identifies some common situations where your IP might be owned by another party. To the right is a checklist to help you conduct an audit of your IP assets to ensure that they are appropriately owned.

Who should own your IP?

The best way to answer this question is to ask: who is controlling the use of the IP?

In a small family-owned operation it might be appropriate for an individual (say, the principle winemaker) to own the trade marks and IP.

A larger operation might have multiple companies. The company which controls the quality of the wines to which the trade marks are applied should own the trade marks (or be licenced to use the trade marks).

Over time, the day to day function of people or companies within an organisation may change. Periodically review whether valuable trade marks and IP are owned by the appropriate entity.

Works created by employees

Copyright may subsist in original written or graphic works.

The Copyright Act 1994 says that an employer will be the owner of any copyright works created by employees in the course of their employment; that is, while carrying out their normal duties.

If you employ marketers and designers to create material for you, this is straightforward. It is less clear-cut if an employee’s role has evolved over time and/or their contract is vague.

It is good practice to obtain a separate assignment of copyright for significant documents, artwork or photographs created by employees or contractors.

Label design

It is common to outsource the design of bottle labels to a third party. The contract usually contains a scope of work and, of course, the designer’s fee. However, it is often silent on IP. You should make sure that you receive an assignment of copyright for any graphics and logos designed for you.

Website content and marketing collateral

The written content and images used on your website and in your hardcopy marketing materials – provided that they are original and not copied from elsewhere – are likely to be copyright works and included in your IP assets. This includes the company history or tasting notes. If any of this material originated from a third party consultant or designer, you may not own it. Check the contract and, if necessary, seek an assignment.

Photographs

Your website and marketing material will feature photographs of your bottles, your vines and key staff members. Ask: who took the photographs?

If the photographer was an employee, copyright in the photos might be owned by the employer. But was the employee taking the photos in the course of her employment? If the person is employed as maître d’ in your cellar door restaurant, taking photos is probably not included in her usual duties. She might retain ownership.

If the photos were commissioned, and paid for, then the Copyright Act says that the person (or company) who commissioned them will be the owner.

Purchasing IP assets from another winery

IP acquisitions warrant a text book on their own! For the purposes of this article, we have two important tips if you are purchasing trade marks from another winery (perhaps as part of an acquisition of the entire business):

Always search the Trade Marks Register before signing the Sale & Purchase Agreement. Check that the seller actually owns the trade marks which it is purporting to sell. Make sure that the schedule of trade marks in the Agreement is complete and accurate. Check that none of the trade mark registrations have expired, been cancelled or are in the name of a different company.

Remember that the onus is on you, as purchaser, to record your company as the new owner of the trade mark(s) and update the address for service on the records of the Intellectual Property Office of New Zealand.

Checklist

We recommend identifying the valuable IP used by your business and checking as follows:

• Trade marks – who controls how the trade marks are used and the quality of the wines to which they are applied? The person / company with control should be the owner (or be licenced). Always check and update the Trade Marks Register when acquiring brands from others.
• Labels – check the contract with the company who designed the labels. Does the contract assign copyright to you?
• Website content / marketing material – Who wrote the text of your website and brochures? If the person was not an employee acting in the course of their employment, you may need an assignment of copyright. Check the origin of other content such as graphics, videos and photos.
• Photographs – find out who took the photos and whether they were commissioned or taken by an employee in the course of his/her employment.