Here’s the true cost of manufacturing your invention overseas. The minute you send your blueprints to a manufacturer, you introduce a massive risk of intellectual property theft.
The Horror: When an idea is copied overseas, it's virtually impossible for a small business to stop it. Your U.S. patent is powerful here, but useless in their jurisdiction. International patents can help, but they’re really only as good as your ability to pay for lawyers overseas to defend them against infringement. Large corporations can handle that cost far better than small businesses.
Your Defense: The Contract Chains
You must bind your manufacturer with an iron-clad contract that includes:
1. IP assignment clauses explicitly stating all resulting intellectual property belongs to you.
2. Strong non-disclosure clauses (or separate Non-Disclosure Agreements (NDAs)) for everyone involved to protect confidentiality.
3. Audit and termination rights clauses allowing you to inspect their facility and clearly defining penalties for unauthorized production.
Like with international patents, though, the cost of hiring lawyers here or overseas to help you if the manufacturer doesn’t abide by the contract can be significant.
The best protection against the likely problems with overseas manufacturing is to have your invention manufactured in the U.S. Yes, that may be more expensive in terms of manufacturing costs, but what you may save in enforcement costs may be worth it.
Whether you have your product manufactured in the U.S. or overseas, don't start production without legal chains securing your intellectual property, and be prepared to hire lawyers here and overseas to help you enforce these contracts!
Intellectual property is one of the most terrifyingly useful tools you have. If you’re a creator or other entrepreneur ready to build a frighteningly powerful brand and business, you need to know how to use it.
You don't have to face the darkness alone. To learn more about protecting your creations, your name, your business, and your legacy, you can book a consultation with me at kingpatentlaw.com. I help entrepreneurs across the U.S. make smart, legally sound decisions about their intellectual property. I'm an attorney in Champaign-Urbana, Illinois, and I serve intellectual property clients nationwide.
If this episode helped you survive the horror of learning about how to protect and manage your intellectual property and business, please like and subscribe! You can find all of my other frighteningly good content on the King Patent Law website, at "Spellbinding IP: Patent, Trademark, and Business Strategy" on all major podcast platforms, and at @kingpatentlaw on most social media.
The information provided in this episode is for educational purposes only and does not constitute legal advice or form an attorney-client relationship. You should not act on any information presented here without first seeking the counsel of a licensed attorney for your specific legal needs.
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