‘Freedom to operate’ analyses

‘Freedom to operate’ analyses

Companies do not just protect their own products by means of appropriate property rights, they also have to pay attention to the property rights of their competitors. If they ignore property rights or fail to inform themselves about them, a claim may be brought against them for cessation, compensation for damages etc. due to intentional infringement or negligence. This includes the technical property rights of the patent and utility model as well as the non-technical property rights of the trademark and design patent.

Consequently, companies should, ideally before beginning development of a product but at the latest before launching a new product, inform themselves about the relevant property rights of competitors in the relevant market and hence about the limits of their own freedom to operate, e.g. by means of research into existing property rights of third parties.

If the relevant property rights are known or have been researched, an assessment should also be performed of the scope of protection of the relevant property rights in relation to the planned development or to the product to be launched; this is in order, if applicable, to direct the development in a particular direction or to perform changes to the product so that an infringement of property rights can be safely avoided in time.

In the development phase in particular, these efforts pay dividends very quickly, as it is here that the biggest influence can be had on the focus of the future product with the smallest amount of effort. However, even with market-ready products, it is worth looking at the situation with regard to property rights oneself, since a patent infringement is frequently associated with disputes between competitors which not only lead to obligations to pay compensation for damages but can also damage the public reputation of the infringing company.

© Copyright Dr.-Ing. Christian Holz. All rights reserved.