Knowledge and information are recognized as the prime assets in the recent times. Intellectual capital is an important source of an organization's economic wealth and is, therefore, to be taken into serious consideration when formulating the firm's strategy (Bollen, Vergauwen, Schnieders, 2005). Intellectual property is a legal term referring to intangible property that is the creation of human intellect of technological know-how and artistic work. Intellectual property rights are the rights to ownership of this property for a specified time to an individual or an organization. These rights are for anything that has been created by a person's mind to which they may have valuable legal right (Driscoll, 2002). It consists of copyrights, patents and trademarks.
Copyright is the exclusive legal right to commercialize, reproduce, distribute, display, perform and license the said copyrighted work such as a book, music or software. Patent is the governmental grant to an inventor to produce and commercialize their inventions for a period. Trademark is the distinguished word, phrase, logo or a combination that differentiate an organization or its product from other.
Rapid technological advancement and business between companies situated in different legal system makes managing intellectual property tricky. These two factors are discussed in detail in the following section with the help of cases.
Complexities in International Business
The parties involved in global business scenario are often located in geographically distributed locations, follow different legal systems and have different business culture and notions there are plenty of chances for ambiguities causing legal consequences. Transfer of intellectual property rights is a common practice in international business. IPR transfer means to give license to the other party that allows them to use relevant intellectual property. The license includes condition of usage and financial compensation to obtain those rights.
A case involving a claim for intellectual property violation is Beijing Zhongyi ZhongBiao Electronic Information Technology Co. Ltd. v. Microsoft Corporation et al. This case is interesting to study as it was heard in China as well as United States courts and contradicting judgments were delivered on both occasions.
The case: Beijing Zhongyi ZhongBiao Electronic Information Technology Co. Ltd. versus Microsoft Corporation
Judgment of the United States District Court
Western District of Washington
Case Number: C13-1300-MJP
Background: In 1995, Microsoft entered into a licensing agreement (Agreement 1995) with Chinese Government and Zhongyi to use certain fonts to develop a Chinese version of Windows 95. In 2007, Zhongyi sued Microsoft in Beijing’s Intermediate People's Court for violation of intellectual property right by continuing the usage of the fonts in the following non Windows 95 products. On November 16, 2009 the court gave a decision that...