The internet IP of things

By Helen Gu, Sina Corporation

We asked intellectual property inhouse counsel about the challenges in their work and what they see as the most significant legal developments

Helen Gu is the general counsel at Sina Corporation. Here she shares her views on the challenges and appropriate measures that in-house teams of internet enterprises should be adopting to stay ahead of the curve on IP infringement and enforcement

Helen Gu
General counsel
Sina Corporation

CBLJ: What challenges do internet enterprises face in the intellectual property field?

Helen Gu: The first major challenge, as compared with traditional enterprises, is the greater complexity of intellectual property protection for internet enterprises.First, as innovation is one of the key features of internet enterprises, with the arrival of the artificial intelligence age, the coming of more new IP legal issues is unavoidable, for example the legal characterization of artificial intelligence “works”, the line of demarcation between fair market competition and abnormal competition between internet enterprises, and so on.

Second, the ways and means of transmitting internet IP are much more varied and numerous, resulting in a greater variety of means and methods of IP infringement, requiring us to adapt to new changes and respond to and prevent new forms of infringement at a moment’s notice. As for those vaguely defined regions, while acting in lockstep with the business frontline, it is also necessary to thoroughly analyze laws, regulations and relevant policies in a timely manner to provide legal support against IP infringements, as this is the only way to forcefully hit back against acts of infringement.

As internet enterprises face real time and varying acts of infringement, the facility and low cost of internet infringement acts contrasts sharply with the high cost of protecting internet enterprises’ rights and the low measure of damages for such infringements. On the one hand, we need to invest substantial sums to establish an internal infringement monitoring system while also relying on outside help to carry out more rigorous project-based monitoring; and on the other hand, with respect to any infringement that is uncovered through monitoring, we need to do a lot of evidence solidification and invite the participation of a team of legal experts, which also entails significant costs.

Third, the level of expertise required for protecting the IP of internet enterprises is higher. As the development of computer technology has brought about completely new technical issues such as deep linking, artificial intelligence, etc., the related IP issues also exceed run of the mill legal issues in the specialization required. IP protection and the determination of infringement will regularly involve numerous specialized issues, requiring professionals in the field to provide specialized responses.

Finally, the methods of IP protection are many. In the past, enterprises usually considered copyrights, trademark rights and patent rights to be mutually separate, and were of the opinion that using one method of protecting one intellectual achievement was sufficient. However, in the “internet +” environment, in the face of a great variety of new legal issues, different types of IP will often intersect, such that using the traditional single protection method will usually make it impossible to achieve sufficient IP protection. Accordingly, with respect to one new intellectual achievement, we recommend carrying out comprehensive protection from the trademark, software copyright and patent perspectives.

The second major challenge is that the global nature of the internet has made IP protection and infringement international.

The internet allows information to be transmitted globally in an instant and greatly facilitates enterprises’ efforts to conduct their business activities on a global scale. It can be said that the internet has torn down every boundary, including territorial ones. In the face of such a situation, internet enterprises have begun to train their sights on a global disposition; it is precisely because they perceive these globalized business opportunities that there are still a significant number of entities around the world that are actively engaging in the pirate registration of trademarks and domain names, “laying mines” in preparation.

This requires our IP strategy to have an eye on the entire globe, and requires the adoption of different IP protection and rights protection strategies tailored to the different laws and regulations of different countries. On the one hand, this entails duly planning an internet company’s IP territory and ensuring the safety of IP as a core asset of the company; on the other hand, it responds to the state’s call for the Belt and Road Initiative so that enterprises can better stride out from the national door and lay a solid foundation for their IP rights.

CBLJ: What matters should an enterprise pay attention to in terms of IP compliance?

Helen Gu: First, the formulation of a global IP strategy. IP is an important asset and competitive tool of enterprises. When formulating an enterprise’s future development plan, it is necessary to take into consideration its internal and external environments, determine its positioning, eye the entire situation and, on this basis, formulate a holistic IP

strategy that is in keeping with the particular features of the enterprise, and that addresses such key stages as IP research and development, filing, rights protection, etc.

The globalized transmission of internet enterprises inevitably triggers the problem of cross-territorial protection of IP. Intellectual property law is itself intensely local, and the IP regimes of different countries are not completely alike. For example, in the trademark law field, China has adopted the first-to-file principle for trademark registration, whereas US trademark law applies the first-to-use principle.

Accordingly, an internet enterprise’s trademark strategy in different countries cannot be the same. Furthermore, in terms of IP dispute resolution, there also exists differences in the systems of different countries, adding significant difficulties to cross-border rights protection or participation in cross-border response to litigation in practice.

Second, it is necessary to keep a close eye on the constant replacement of internet products and the updating of laws and regulations at all times. It is necessary to participate in the writing of legislation, speaking up, on the basis of the current state of the industry, for internet enterprises and lending a hand in the formulation of internet laws and regulations.

As the speed of upgrading internet products far exceeds that of traditional industries, it is necessary for corporate IP counsel to pay attention to and follow industry trends relating to new products, changes in IP information and updates to laws, statutes and policies. In the “internet +” age, and spurred by indigenous innovation, fresh new knowledge, technologies and creations emerge endlessly. Through the gathering and analysis of the most recent IP information, an enterprise can timely keep abreast of the technologies already on the market, what technologies are lacking, what types of technology are the most market competitive, etc., and use the same as an important reference for project proposals.

Additionally, by keeping abreast of legislative trends, an enterprise can timely make use of relevant regulations to secure rights and safeguard its rights and interests; and by actively participating in the legislation process and speaking up for internet enterprises, it can lend a hand in formulating internet-related laws and regulations.

Third, it is necessary to improve IP management systems, which are the specific buttress and rules that an enterprise requires to carry on its IP work. Intellectual property management systems should cover all such aspects including IP property research and development, filing, registration, maintenance, and protection. More specifically they can include a patent management and incentive system, trademark registration and protection system, copyright registration system, and infringement monitoring system.

For example, the Sina Group’s patent bonus mechanism expressly provides that the lead inventor of an invention or utility model can receive a RMB3,000 (US$450) per item bonus at the application stage, the lead inventor can receive a RMB3,000 per item bonus at the patent grant stage, and at the time of the internal promotion evaluations, the inventors of inventions/utility models for which a patent was filed/granted may receive the corresponding additional points. With the motivation spurred by such a system, the number of patents that we have filed for and been granted has greatly increased.

Finally, it is necessary to assemble a professional IP management team. A sound system requires a professional team to implement it, if it is to fully demonstrate its value. There are two main ways for an enterprise to build an IP team: (1) assembling dedicated personnel internally; or (2) working with a professional third-party IP company or firm.

Internal personnel only serve the enterprise, can promptly and effectively complete routine IP management work, are responsible for communicating with the internal business team and, compared with an outside team, are more familiar with the enterprise’s own product and business requirements.

An external IP team has greater professional expertise. Certain foreign-related IP teams are additionally skilled in the IP of different jurisdictions. When encountering a legal issue where the expertise level demanded is relatively high, particularly when cross-territorial IP issues are involved, it would be my recommendation to promptly bring in a professional outside IP team.

As to which specific method to use and how to manage the IP team, that depends on the particular characteristics of each company.

(Video interview with Helen Gu)