Originally published in the Virginia Lawyer, Vol. 51, No. 1, pgs. 36-40, June/July 2002.
So you have a new client. You recently handled its incorporation and helped to unleash a new business upon the world. The client really intrigues you because its business plan is unlike any you have ever seen. It is the most exciting new idea since Amazon.com. It is surely going to make money, lots of money.
After advising the founding entrepreneur about the best way to set up her new company, working through the tax implications, drafting an operating agreement and articles of incorporation, lining up liability insurance as well as the most appropriate accountants, you believe that you have thoroughly instructed the entrepreneur regarding the do’s and don’ts of good corporate startup management. But then the client’s inevitable question comes: "How do I legally protect my business from others that would simply take my business plan and run with it?" After all, there are other larger companies out there that are adept at quickly and efficiently implementing a business plan. Also, in the market that your client’s new business plan is surely going to create, there are no real practical barriers to entry.
Your client is afraid of creating a market at great effort just to see others take it away and begins to wonder about a future path that appears difficult and treacherous. But you (with a little help from this article) begin to explain some of the protections afforded by the intellectual property laws.