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Congress, FTC Provide New Support for Small Businesses Regarding IP and Cybersecurity

Business Law

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Two recent developments addressing intellectual property (IP) and cybersecurity could have a big impact on the nation’s 30.2 million small businesses.

Startups and small business owners, stereotypically, are keenly aware of intellectual property and its value, but unaware of the various protections afforded to each type and, too often, unable to afford to protect what has or is being stolen.

When conducting a hearing in July 2018 on small businesses’ use of IP in the digital technology industry, the U.S. House of Representatives’ Committee on Small Business, similarly stated “many small business owners are not aware that they should protect their innovative products and ideas through intellectual property protections. [Even so, t]hose small business owners who are aware of intellectual property right do not always know how to navigate the intellectual property process, and [how] it can be very expensive.” The Committee continued, describing the disadvantage small businesses face compared to large businesses due to deficient use of IP protections.

To address this disparity, Congress proposed the Small Business Innovation Protection Act (SBIPA) earlier this year, which was signed into law on October 9, 2018. The new law directs the SBA and the (USPTO to jointly develop “high-quality training . . . for small business concerns relating to domestic and international intellectual property.”

Congress, when proposing SBIPA, stated the SBA and USPTO are well positioned to provide valuable, educational resources to small business owners electronically and at local Small Business Development Centers. The SBA and USPTO have until April 2019 to develop these educational services.

In addition to threats to the security of IP, startups and small businesses also are disproportionately affected by cyberattacks, in part, because of owners’ lack of cybersecurity knowledge and ineffective protections. The casualty of a cyberattack is often a business’s IP, sometimes a trade secret (e.g., user data, customer lists, etc.) or a patented invention. In fact, according to Verizon’s 2018 Data Breach Investigations Report, approximately 47 percent of all breaches involved purposeful theft of IP to gain a competitive advantage.

Understanding cyber threats, mitigation techniques, and corrective measures will protect a business’s operations as well as its IP assets. On October 18, 2018, the FTC launched a new cybersecurity education campaign – Cybersecurity for Small Business – specifically for small business owners. The campaign comprises informational materials, videos, quizzes, and subject-specific modules such as “Cybersecurity Basics,” “Understanding the NIST Cybersecurity Framework,” “Ransomware,” and “Securing Remote Access.”

General awareness of IP protections and cybersecurity precautions will undoubtedly bolster small businesses across the United States, particularly those in industries heavily reliant on technological innovation (e.g., semiconductor, computers, pharmaceuticals) and those operating internationally.

Startups and small businesses should utilize these educational services to develop their own understanding of IP (i.e., patents, trademarks, copyrights, trade secrets) and the various protections afforded to them. Similarly, startups and small businesses should develop cybersecurity measures to protect their businesses and their IP from cyberattacks, both foreign and domestics.

Well-informed startups and small businesses are better prepared to work with their attorney in addressing issues when they arise, such as responding to a cease-and-desist letter from a non-practicing entity or disputing another business’s use of their trademark. Startups and small businesses should work with their attorney to develop IP strategies and cybersecurity procedures.

At Tully Rinckey, our attorneys can assist startups and small businesses address their IP and cybersecurity needs. Through the TR Business Navigator, an affordable, dynamic, legal service and guidance program, new startups and existing small businesses can receive immediate solutions while interacting with a law firm that will partner, grow, and support their new business.

To find the best plan for your startup or small business, contact Tully Rinckey today at (888) 248-5175.

 

Daniel T. Kane, Esq. is Director & Lead Counsel of TR Business Navigator at Tully Rinckey PLLC’s Albany office, where he oversees the TR Business Navigator, an affordable legal service and guidance program for new startups and existing small businesses.

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