Infringing on others' IP

You should ensure you do not inadvertently infringe on someone else's intellectual property (IP) rights.

How to avoid infringing on others' IP

Infringement can be costly so it’s best to take proactive steps to avoid infringing on others' IP. There are a number of basic steps you can take:

Search and be sure

It is good business practice to conduct a search as early as possible. This should be done before you invest time and effort in developing a new logo or product. Searching may uncover any potential for inadvertent infringement on others' IP rights.

Identify your IP

Knowing what IP your business owns is vital when dealing with alleged infringement. For example, it may be claimed that you are infringing on someone else, when in fact you can prove your ownership of that right. In addition to any registered rights, your IP includes any business-critical information such as customer lists and specialist knowledge. Make sure your details are kept up to date and any renewals are paid on time.

Get permission for source material

Avoid using any material that is sourced from another person without first obtaining specific permission (often referred to as a 'clearance' in relation to IP rights).

You should always ask about the source of any material provided to you and any clearance involved.

Retain ownership records 

You should maintain documents that record your ownership of IP rights or your entitlement to use them. These records can help to prove that any infringement was innocent rather than deliberate. This could substantially reduce any liability if you have infringed.

For example, under the Copyright Act 1968 although knowledge of an infringement is not necessary to prove infringement of copyright, it does have a major impact on the damages a court will award. If a court finds that an infringer did not know and had no reason to believe that there would be an infringement, the court cannot order the infringer to pay damages. Instead the infringer is ordered to pay the owner of the copyright the value of any profits obtained from the infringement.

Dealing with alleged infringement

You will usually find out about the alleged infringement via a letter of demand.

If you are accused of infringing on another's IP there are some steps you can take:

Get advice

It is important to understand whether or not you are infringing on another IP right, what courses of action are open to you, and the cost and likelihood of success of each action. The course of action you select should be appropriate to your business needs. You may wish to seek advice from an IP professional.

Stop the infringing conduct

If possible you should immediately stop any conduct that is alleged to be infringing.

This is not an admission of guilt in itself. It simply gives you the opportunity to obtain legal advice to confirm whether or not you have a right to continue.

By stopping the conduct you will remove the major impetus for the owner of the IP rights to commence legal action. It will make it more difficult for them to obtain an interim injunction.

It will also prevent you from creating further infringements that could be the subject of a claim for damages.

Responding to an empty threat

In some cases threats of infringement may be baseless. This could be because the IP rights do not exist, or infringement cannot be proved. Such threats clearly cannot result in successful infringement action.

Even if an allegation is false it can cause disruption to your business. You may have to cease production of specific items while you investigate the claims against you. This could lead to a loss of business or profit. In this case you could respond to the person issuing the threat and ask them to give an undertaking not to repeat the threat and pay compensation to you for any loss you have suffered as a result.

Unjustified or invalid claims of copyright infringement are legally prohibited and may cause the person issuing the threat to be liable to compensate you for the consequences of making the threat.

Please note that the information on this page is general advice and not intended to replace legal advice specific to your situation.

Last updated: 
4 March 2016