Types of Intellectual Property Fraud

Folder of copyright documents Photo by Olivier Le Moal - yayimages.com

We have been previously discussing frauds and scams on businesses and corporations. While we ponder the enormous amount of theft that does go on, we cannot be blind to other areas where thefts of a property can occur. With that said, let's take a look at intellectual property, what it is and how we can protect ourselves from someone 'stealing' our original works. A definition follows: "A work or invention that is the result of creativity, such as a manuscript or a design, to which one has rights and for which one may apply for a patent, copyright, trademark, etc."1.

The term refers to a vast classification that can include inventions, innovations, content such as articles and case studies, compositions like novels, logos and symbols, creative media like music, photos, movies and advertising which includes slogans, taglines, and illustrations.

What is Intellectual Property Fraud?

Intellectual property theft occurs when it is used without the permission of the proprietor. There are laws in place which protect a company’s intellectual property prerogatives. These include four main categories, which will be discussed in greater detail below. These are copyrights, trademarks, patents, and trade secrets respectively. Once these are acquired and installed, they provide security for the intellectual property.

Also, in cases of infringement, owners can take the litigation route as well. Any act that is deemed a violation regarding the four laws mentioned above may be categorized as either a civil or criminal matter.

Naturally, intellectual property is assigned a value, which may be tantamount to millions of dollars in certain instances. Given their formidable worth, it is imperative to safeguard these investments.


A simple definition of a 'copyright' is that it is a form of intellectual property protection enforceable under the law. It protects one's creative work that has been fixed in a tangible medium, such as an audio file or published on social media. The copyright laws apply to works of art, pictures, videos, and articles that have been published to a public medium.

In principle, copyright is a regulation that grants ownership over intellectual property to those who have devised it. Any creative contribution or artistry, such as the development of a software or a painting, can be classed as IP. Being in command of the proprietary real estate gives copyright holders the right to reproduce the work, develop derivative articles, disseminate the work and display it as well.

The aforementioned prerogatives belong solely to those who have the copyright. Unless they are willing to concede the right i.e. through a creative commons license, no party can contravene it within legal means. In layman’s terms, this means that unless the copyright holders do not give explicit permission, no other party can reproduce the work.

Inversely, those who maintain an interest must seek approval. Any other course of action would be ill advis, legal procedures, regardless of intent. The owner of the copyright essentially has carte blanche over his/her work.

A copyright infringement would entail any misdemeanor or transgression of the aforementioned copyright. If a party is involved in the unauthorized use of materials that are under copyright, regardless of its nature, then they will be committing misconduct.

Parties that coin intellectual property register for copyright protection in order to ensure that others do not profit from their creations. For deliberate or imprudent reasons, a copyright infringement may transpire. This may give rise to a prosecution as recourse.


A trademark registration is simply a graphical manifestation or signature that enables concerned parties, such as suppliers and consumers to recognize that commodities belong to a specific company.

It is pragmatic and facile to delineate what a trademark is. For instance, the Mercedes Benz logo or the Nike swoosh are synonymous with their respective brands. These symbols are known worldwide as a sign of excellent quality products that consumers can identify with. They are able to discern the company instantly after a glimpse of the badge. Besides, these emblems also form a vital aspect of the product’s corporate identity.

A trademark is designated using two distinct denotations. If the mark is registered then a small ‘R’ follows the mark where the trademark is exercised. Moreover, if the mark is unregistered, then a ‘TM' follows the mark. To be valid, a mark must be subject to registration, which can be enacted by any individual or business. They must complete the requisite red tape before they obtain the trademark.

A trademark violation is any deed that encompasses the unapproved or unjustified use of a commodity that belongs to another party. A trademark exists to safeguard intellectual property, the same way a copyright does. If an infringement occurs then the ramifications would include a potential lawsuit and the outcome would depend on whether the defendant’s use created confusion for the average consumer, as well as if the defendant acquired any monetary gain from the infringement.


A patent confers its holder with the privilege to exclude others from the exploitation of the patented product for a limited duration unless the consent of the owner has been taken. Basically, this is another measure implemented to conserve the intellectual property and forbids others from employing, manufacturing or trading the patented good or service.

A form of industrial property, patents can be assigned, transferred and licensed as well. Also, they are territorial, which means a patent that is ordained in the United States is valid only in the country. A product can be patented if it meets the criteria, which states that the merchandise must be an original creation, should involve innovation and ought to have an industrial application as well.

A patent invasion means any action where one party makes or sells a patented invention without prior consent. Patents are public record which means they can be obtained by the general public. However, the practice is illegal and can move to court if the patent holder decides to sue. This may result in the wrongdoer ceasing usage of the intellectual property or having to pay pecuniary damages to compensate the patent holder. A patent infringement may be direct, indirect, and contributory or induced in nature.

Trade Secrets

Any practice or process of a company that is not public knowledge and is limited to the confines of the business can be defined as a trade secret. Information which is considered a trade secret is thought to give the business a competitive advantage and is typically the result of in-house research and development.

There are no legal stipulations that a firm must adhere to but they must ensure responsibly that the details are concealed and are not divulged to their rivals. Also, a trade secret must have economic value.

Trade secrets may find their way beyond the company’s reach for a number of reasons. For instance, there may be a security breach courtesy of skilled scammers. Alternatively, it may be down to human error and an employee may be responsible for disclosing priceless information unintentionally.

1Google Dictionary

Posted On August 29, 2018