Page 8 - Beverage MasterFebMarch 2021_Update

Legal & Marketing

• Copyrights: Copyright protection arises automat- IP (if applicable), and any documentation relating to
ically as soon as an original work of authorship is disputes or claims of infringement involving your IP
“fixed” into something tangible. Basically, once (if applicable). Make sure you have clear documen-
you draw the artwork for your bottle or can, tation of the chain of title (meaning who owned it
write the code for your website, or draft up a at each point) from origination to present day.
piece of marketing material, it is protected by
copyright. Registration affords several key ben- Do Both Sides Actually Own Their IP?
efits but is not required to claim ownership in a
work. The next question you need to ask yourself in any
deal is: Do we actually own that IP? The answer may
• Trade secrets: A trade secret is something that not be as simple as you think. You need to be sure
gives you value because it is secret. Examples that all assets are owned by the company and not
include customer or vendor lists and recipes. an employee, owner, or even a third party. A lot of
companies don’t realize that if they hire an inde-
Additionally, when you go through a merger or pendent contractor to make something, whether a
acquisition, you will often be asked to list out all website, logo, or marketing materials, unless they
of your domain names, social media, and in some have the contractor expressly assign the finished
cases, any software that is material to your busi- product to their organization, the contractor owns
ness. It is important to make sure you keep a list of it. Employee-created works should automatically
these assets in case an opportunity arises. transfer to the employer, but it is still good prac-
tice to include an assignment in your employment
Now that we’ve covered the basics, let’s dive into agreements.
the top five things you need to know in a merger
and acquisition when it comes to your IP. Ownership issues can derail or even terminate
what would otherwise be a great deal. Make sure
What IP Do I (and They) Have? that the ownership of IP on both sides is clearly doc-
umented and validated as you move forward.
Start by taking an inventory of everything you
have that is protectable – beer names, wine names, What Are We Agreeing to
logos, artwork, packaging, unique brewing process- in the Deal Terms?
es or recipes, social media accounts, and domain
names – to name a few. This should include any- Within the deal documentation, there will be a
thing you registered, anything you are trying to reg- number of representations and warranties and
ister (like pending applications), and anything unreg- indemnity provisions that relate solely to IP and the
istered but material to your business. Disclosure disclosures and transfers being made in the deal.
schedules are used to list all of the IP and what is to This is why it’s so important to make sure you have
be transferred in the transaction (if not everything). your ducks in a row with your IP as you move for-
Be clear to fully disclose what you have without ward.
overstating.
These reps and warranties will range from confirm-
The same should be true of the other side. You ing ownership of the IP to promising your IP does
should ask them to disclose all of their IP assets that not infringe the rights of others. You can also see
will be a part of the deal, all the way down to their reps and warranties that ask you to declare that
social media accounts and domain names. your employees have not created any IP that is not
owned by the company. Your legal counsel can help
As you and the other side are pulling this together, to finesse the reps and warranties to match your
you also want to collect all of your documentation circumstances and protect you as best they can, but
to evidence the IP. This could include trademark it’s important you ensure everything stated is accu-
applications and registrations, copyright registra- rate. A broken rep and warranty in a transaction can
tions, patent applications, patents, email accounts, be expensive and arise after the deal is done.
and social media accounts. You will also want to pull
any licenses you have to use IP, independent con- You may also be asked to indemnify the other side
tractor agreements regarding creation of IP, liens on for any claims of infringement of the IP, even if you

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