Protecting hidden value

With company budgets under pressure, IP owners are rethinking their protection strategies. Cutting costs in this vital domain may prove not merely a false economy but a fatal miscalculation. Vandana Chatlani reports

With corporate budgets slashed, intellectual property rights holders are facing tough decisions about IP protection levels. India’s IP lawyers, meanwhile, are witnessing a surprisingly diverse range of responses to the financial crisis by their corporate clients.

“Touch wood, at K&S Partners we have found absolutely no effect of the downturn,” says co-founder and senior partner Jyoti Sagar. “India will be on the filing map of any important patent … IP filings are on the rise.”

It is even a growing field for some. “People have started focusing on registrations, patents and structural engineering,” notes Dipak Rao, a partner at Singhania & Partners. “Every other day we have an infringement or opposition.”

Echoing Rao is Titus & Co partner Rai Mittal: “We’ve seen new work in the last six months. We’re cleaning up IP portfolios in order to discard IP properties which have no value. Trademarks and patents with little value the world over are being surrendered to the registration office.”

“Companies are challenging the imitation of trademarks and names because it’s so cheap to get registration and filing done,” says Chetan Thakker at Kanga & Co. “Registration costs about Rs5,000-10,000 [US$100-200] so offices are flooded with applications.”

Rahul Chaudhry, a partner at Lall Lahiri & Salhotra, says his firm is receiving an increased number of instructions. “We have been affected to some extent on the filing side. But our growth has been 170% – that’s 19.5 crores [US$3.8 million].

“We’re doing the biggest litigation ever for Coca-Cola and a major filing for Sony,” continues Chaudhry, whose firm also handled a recent filing for cosmetics giant Estée Lauder, its first case in India. “The non-contentious side has been somewhat affected,” Chaudhry concedes, “but big players like Novartis and Nike won’t be affected.”

Lall Lahiri & Salhotra is still hiring and Chaudhry is a bullish mood: “We’re poaching the nice talent at other firms … I will hit them where it hurts the most,” he says.

Becalmed but not beaten down

Not all observers share Chaudhry’s optimism. According to Amarjit Singh, managing partner at Amarjit & Associates, IP work from overseas has come to a halt. “The slowdown in the economies of the US and European Union has considerably reduced the outflow of IP work to India,” he says.

“In the US and in Southeast Asian countries, IP activity is not moving up, it’s at a standstill,” agrees Sunil Krishna, a partner at Mumbai-based IP boutique Krishna & Saurastri. “Our clients are saying instead of protecting 10 brands, protect five, six or seven. Instead of going to 50 countries, go to 30. We’re trying to generate more business from existing clients. Large clients are cutting costs but we have a good domestic client base.”