Abstract
The aim of this chapter is to show that innovation can only produce value once it is legally protected. Indeed, the law is involved throughout the entire life cycle of innovation. Thus, legal protection helps to transform innovation into an intangible asset for the company (patent, trademark, designs and models, databases, etc.). The chapter presents the different legal choices that allow the firm to develop innovation internally or externally. The authors explain that the firm, as a taxpayer, must optimize its accounting and tax choices in relation to innovative activities. Moreover, legal management implies an optimization of the legal and tax structure of the corporate structure in the sense that it is important to choose the most suitable form for an innovative activity. They also show that protecting innovation helps to exploit it through several legal techniques of different natures, such as contractual assignment or concession tools (licenses) or other judicial tools. The legal management of innovation appears as one of the key factors for the success of the innovative firm.
TopIntroduction
The term legal management of the company and especially the innovative company refers to the mobilization of legal or judicial mechanisms in order to achieve a generally extra-legal objective. The law is not an objective; it is a means to the success of the company (Amann and Lethelleux, 2005). Legal know-how, often marginalized and neglected by managers, is becoming a fundamental pillar of any strategic construction. Involved throughout the company's life cycle and accompanying its choices, it can be a determining factor for success or a direct or indirect cause of ephemeral or definitive failure.
In this case, a legal strategy is considered effective if the means used make it possible to achieve the expected results despite any change in the expected or unexpected context. The legal strategy, integrated into the company's overall strategy, is also oriented towards the most advantageous or, at the very least, the least expensive result. The legal strategy is then considered efficient. Nevertheless, is the law that is presented as “public good” supposed to create a competitive advantage?
The rule of law is presumed to be known to all as soon as it comes into force. Moreover, nothing prevents a competitor from imitating the legal resources used or from reproducing the oriented choices. Clearly, legal strategies can hardly lead to sustainable competitive results.
In reality, what is public is only legal knowledge (Amann and Lethelleux, 2005). Legal know-how is rather a skill that develops according to the lawyer's experience and transforms throughout his professional career, thus transforming into real value for the benefit of some companies and at the expense of others. Intellectual property law, managed by a specialised and experienced lawyer, is no longer a simple static legal framework that is imposed by the company as a constraint. It becomes a real capital of wealth by being both a defensive protection body and a source of offensive value creation (Aliouat, 2010). The law is no longer an obstacle, it is now an opportunity.
Undoubtedly, the theory of law increasingly incorporates managerial metaphors. The use of new concepts such as legal management (Barthelemy, 1993), legal strategy (Barney, 1991; Barney, 2001), legal performance (Collard and Roquilly, 2010), legal intelligence or engineering (Berthelemy, 1993; Aliouat and Roquilly, 1996; Champaud, 2006 and Danet, 2006) contributes to the generation of a new legal framework that is normative and inventive, factual and strategic (Aliouat, 2010). Some authors dare to use more audacious concepts such as “legal tricks” (Bagley, 2008), “legal cunning” (Aliouat, 2010) or even “legal game” (Ost and Van de Kerchove, 1994). According to Aliouat and Roquilly (1996), the law is “a formidable instrument for skillfully capturing value, no longer necessarily based on the conventional norm, but more on trickery or cunning (tactical or strategic)”.
In fact, the real asset of the lawyer of an innovative company is to apply the law to the concrete case that depends on the company's internal and external environment and its financial and human resources. The same legal rule may lead to different qualifications, interpretations and solutions when applied effectively. The argument of strategic choices in relation to intellectual property assets may end up advising different solutions for two innovations produced by the same company or by the same inventor and suitable for industry. It is possible to propose to patent the first one and to keep the second one secret. Between the virtual and the real, between law and reality, there is a great distance to travel.
Key Terms in this Chapter
Management: The process of administering, coordinating and controlling the activities of the organization in order to achieve defined objectives, irrespective of its nature, type, structure, and size.
Strategy: Set of decisions or course of actions which assist the entrepreneurs in achieving specific business objectives efficiently and effectively.
Innovation: The process by which new ideas or inventions are generated and converted into a new product, a new service or a new process that creates value. These new ideas must be economically feasible, applied by the firm and converted into a new offer in order to further satisfy a specific need of customers and for which customers will pay.
Industrial Design: A two-dimensional element such as the ornamentation, patterns, lines or colours of a product. A Title to protect the aesthetic aspect of a finished product.
Optimization: Finding an alternative way to achieve the highest performance or the most effective cost under the given constraints, by minimizing undesired factors and maximizing desired ones.
Trademark: The trademark or service mark is a visible sign making it possible to distinguish the goods offered for sale or the services rendered by a natural or legal person.
Patent: New inventions involving an inventive step and capable of industrial application. A patent aims to protect the functional and technical aspects of the product.
Invention: The conversion of new ideas into a new product, service or new process. To be considered as an invention, a new idea needs to be proven as workable.
Industrial Model: A three-dimensional element. More precisely, it is the shape of a product.