The logistics industry is involved in the flow of goods from a point of origin (where goods are manufactured) to the point of use in order to meet the requirements of corporations or customers. This industry manages all issues associated with the flow of goods including the order processing, transportation, warehousing, material handling, and packaging. Companies involved in this industry include trucking, aviation, maritime, logistics and shipping companies, as well as, transportation product manufacturers, suppliers, and operators, and mass transit systems.
For their customers, carriers and brokers need to be aware of the risk by Customs related to intellectual property rights, most often involving trademarks, copyrights and labeling requirements. Carriers involved in international shipping must also be well-versed in various intellectual property laws across the countries through which they are shipping. As goods are shipped across country lines, the distribution companies can come into contact with some laws that can be especially stringent and others that can be very lax. It is within these latter country lines that distribution companies must be vigilant in their IP- protection methods. For offshore manufacturing sites where domestic IP law is not strong, distribution companies must make sure that during their order processing process, no intellectual property such as trade secrets or know-how becomes explicitly available to employees that could easily expose such IP.
To ensure protection of a client’s intellectual property along all parts of the supply chain, the transportation and logistics companies need to take certain measures. Clients must share sensitive and sometimes private information with the logistics companies so that the goods being shipped are handled with the correct care. The logistics companies in turn must offer and maintain an adequate level of protection of their client’s goods along all levels of the supply chain. For one, the logistics and distribution companies need to instate a proactive plan to protect their client’s intellectual property (patents, copyrights, trade secrets, etc.). Next, non-disclosure agreements should be used so that employees are only given information on a need to know basis. Limiting information sharing with employees can help mitigate the occurrence of confidential information being made public. Another safe practice for protecting a client’s intellectual property is for distribution companies to educate their employees on the importance of information protection so that employees can become of a client’s IP rights.
The logistics industry is constantly involved with intangible property issues, affecting the transportation/logistics companies themselves as well as their customers. Carriers and other logistics companies seek to cultivate and expand their brand awareness in the marketplace through trademarks in order to build goodwill for their services and a reputation for quality. The cultivation of a carrier’s trademark or brand is very important for an industry built on the ability to persuade customers that valuable goods will be shipped correctly and safely in the hands of the carrier. In some cases, such as the DHL v. Commissioner Case, a logistics company’s trademark can be valued very highly as it is seen as playing a major role in a company’s success. The DHL trademark in question was ultimately valued at $100 million, higher than even DHL had estimated, which led to a large adjustments of royalty rates between DHL and its subsidiary, DHLI. Therefore, logistics companies themselves should ensure proper registration of patents for distribution technology and registration for trademarks as both forms of intangible property could potentially play a large role in the business’ functions and success. Further specifics for international registration of patents and trademarks are provided below.
Patents
Under the TRIPS agreement, patents should be available in WTO member states for any inventions, in all fields of technology, and the term of protection available should be the minimum twenty years. Also, if a logistics company wishes to make their patent protection more far-reaching, they may opt to pursue the Patent Cooperation Treaty route which allows for patent protection in multiple member states by filling out just one patent application.
Trademarks
For a logistics company that works within so many different countries, a trademark registered under the Madrid System is probably the best option. The Madrid system offers a trademark owner to protect their trademark in several countries by simply filing one application directly with his own national or regional trademark office.
