Page 8 - Beverage MasterFebMarch 2021_Update
P. 8

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

               6     February - March  2021     BEVERAGE MASTER





          BM020321 Main Pages  copy.indd   6                                                                        1/22/21   2:31 PM
   3   4   5   6   7   8   9   10   11   12   13