Limiting Intellectual Property (“IP”) Risks in Corporate Acquisitions and Hiring

What are potential IP risks in corporate acquisitions and hiring?

Corporate acquisitions and hiring can expose companies to various Florida intellectual property (IP) risks. One risk is inadvertently acquiring IP that infringes on third-party rights, leading to potential lawsuits and financial loss.

Another risk is the potential loss of trade secrets during hiring, especially when employees change companies within the same industry.

Need an intellectual property advocate? Schedule your consultation today with a top intellectual property protection attorney.

In Florida, which laws and regulations apply to limiting IP risks in corporate acquisitions and hiring?

Several Florida and federal laws and regulations apply to limiting potential IP risks with corporate acquisitions and hiring. For example, the Florida Deceptive and Unfair Trade Practices Act prohibits unfair competition and deceptive trade practices at the state level. The Florida Uniform Trade Secrets Act also protects against the misappropriation of trade secrets.

The Lanham Act governs trademarks and unfair competition on the federal level, while the Patent Act and the Copyright Act protect patents and copyrights, respectively. Companies must comply with these laws and regulations to minimize potential IP risks during corporate acquisitions and hiring processes. Implementing due diligence, comprehensive employee training, and robust confidentiality agreements can help mitigate these risks and ensure compliance with the applicable laws.

What are the strategic benefits of limiting IP risks in corporate acquisitions and hiring?

Effective navigation of intellectual property law enables the following for businesses:

• Minimizing legal disputes: By addressing potential intellectual property (IP) risks during corporate acquisitions and hiring, companies can reduce the likelihood of costly and time-consuming legal disputes, such as infringement lawsuits. T
• Protecting valuable assets: A proactive approach to managing IP risks ensures that valuable assets, such as trademarks, patents, copyrights, and trade secrets, are safeguarded.
• Maximizing deal value: By identifying and addressing IP risks before finalizing a corporate acquisition, companies can maximize the deal’s value by acquiring high-quality IP assets and avoiding potential liabilities.
• Maintaining business reputation: Companies that diligently address potential IP risks during corporate acquisitions and hiring processes demonstrate a commitment to ethical business practices, which can enhance their reputation and build trust with clients, employees, and business partners.
• Preserving trade secrets: Limiting potential IP risks during hiring, particularly when employees change companies within the same industry, can help protect trade secrets and maintain a company’s competitive advantage.

When a set of facts is appropriate for legal intervention, there are many paths a claimant may take. We are value-based attorneys at Jimerson Birr, which means we look at each action with our clients from the point of view of costs and benefits while reducing liability. Then, based on our client’s objectives, we chart a path to seek appropriate remedies.

To determine whether your unique situation may necessitate litigation or another form of specialized advocacy, please contact our office to set up your initial consultation.

What steps should counsel utilize to limit intellectual property risks in corporate acquisitions and hiring?

Counsel should consider the following to protect their clients:

• Conduct thorough due diligence: Legal counsel should review IP portfolios, licenses, agreements, and registrations to identify potential issues with the target company’s IP assets.
• Evaluate employee agreements and practices: Counsel should review employment agreements, non-compete clauses, and confidentiality agreements to ensure they are adequate and enforceable under Florida law and applicable federal regulations. Additionally, counsel should assess company practices related to handling trade secrets and onboarding new employees, particularly those coming from competitors.
• Develop a comprehensive IP strategy: Counsel should work with the company to develop a comprehensive IP strategy that addresses potential risks and ensures the proper management of IP assets. In support, counsel may implement robust policies and procedures for protecting and enforcing IP rights and maintaining an up-to-date IP portfolio.
• Collaborate with stakeholders: Counsel should collaborate with key stakeholders, such as the company’s management, employees, and external advisors, to ensure everyone understands the importance of limiting potential IP risks during corporate acquisitions and hiring.
• Monitor and enforce IP rights: Legal counsel should actively monitor the market for potential IP infringements and take appropriate enforcement action when necessary. Counsel may involve sending cease and desist letters, negotiating settlements, or initiating litigation.
• Stay informed of legal developments: Intellectual property laws and regulations constantly evolve. Therefore, counsel should stay up-to-date on relevant legal developments in Florida and the federal level to ensure compliance and proactively address potential IP risks.

Please contact our office to set up your initial consultation to see what forms of intellectual property protection may be available for your unique situation.

Frequently Asked Questions

1. What types of intellectual property can be at risk during a corporate acquisition or hiring process?

Many different types of intellectual property can be at risk during a corporate acquisition or hiring process, including:

• Trade secrets;
• Patents;
• Copyrights; and
• Trademark

2. What legal remedies are available to a company that suffers intellectual property loss due to a corporate acquisition or hiring process?

If a company suffers intellectual property loss as a result of a corporate acquisition or hiring process, it may have several legal remedies available to it, including:

• Injunctive relief: A court may issue an injunction to prevent the target company or candidate from using the acquiring company’s or hiring party’s intellectual property.
• Damages: A court may award the acquiring company or hiring party damages for losing its intellectual property.
• Criminal penalties: In some cases, intellectual property theft may be criminal. The target company or candidate may be subject to fines and imprisonment if convicted.

3. What strategies help prevent intellectual property theft during corporate acquisitions or hiring?

Several strategies help prevent theft during a corporate acquisition or hiring process, including:

• Conducting a thorough background check on the target company or candidate. Background checks will help identify potential red flags, such as a history of intellectual property theft.
• Using non-disclosure agreements (NDAs) with the target company or candidate. NDAs will help to protect the acquiring company’s or hiring party’s intellectual property from unauthorized disclosure.
• Monitoring the target company or candidate’s activities closely, identifying any suspicious activity, such as the unauthorized copying or use of the intellectual property.
• Taking prompt action to investigate and address any suspected intellectual property theft, minimizing the damage caused.

Have more questions about how intellectual property protection could impact your business?

Crucially, this overview of IP risks in corporate acquisitions and hiring does not begin to cover all the laws implicated by this issue or the factors that may compel the application of such laws. Every case is unique, and the laws can produce different outcomes depending on the individual circumstances.

Jimerson Birr attorneys guide our clients to help make informed decisions while ensuring their rights are respected and protected. Our lawyers are highly trained and experienced in the nuances of the law, so they can accurately interpret statutes and case law and holistically prepare individuals or companies for their legal endeavors. Through this intense personal investment and advocacy, our lawyers will help resolve the issue’s complicated legal problems efficiently and effectively.

Having a Jimerson Birr attorney on your side means securing a team of seasoned, multi-dimensional, cross-functional legal professionals. Whether it is a transaction, an operational issue, a regulatory challenge, or a contested legal predicament that may require court intervention, we remain tireless advocates at every step. Being a value-added law firm means putting the client at the forefront of everything we do. We use our experience to help our clients navigate even the most complex problems and come out the other side triumphant.

If you want to understand your case, the merits of your claim or defense, potential monetary awards, or the amount of exposure you face, you should speak with a qualified Jimerson Birr lawyer. Our experienced team of attorneys is here to help. Call Jimerson Birr at (904) 389-0050 or use the contact form to schedule a consultation.