BUSINESS MODEL AND

INTELLECTUAL
PROPERTY ASSIGNMENT

BY: AVIRAL JAIN, SNEHA GUPTA, TANUSHREE SHRIVASTAVA, TANVI SINGLA

IPR IN FASHION INDUSTRY

Intellectual property right is sine-quo-nun aspect of the fashion industry. Fashion designers
generate innovative and creative ideas that are the pillars of strength for the industry. These
creative ideas may last for a lifetime and some of them may come and go momentarily. When
it comes to fashion industry, intellectual capital is invested in each creation. Protecting such
intellectual assets transfers the owners of competition for businesses as designers are able to
generate significant bottom line and top line, if their IPRs are protected.

As per the law, innovation and invention in the fashion industry can be protected through
trademarks, design rights, patents and copyrights. These IPRs caters exclusivity to the
designers creations and provide rights to exploit their ideas.

These rights prevent fashion piracy and counterfeiters from taking undue advantage from the
hard work of others. In this dynamic environment where changes are pervasive, fashion
designers need to be innovative and keep reinventing to overcome the face off.

EXAMPLES:

ZARA uses proprietary information technology system for the production cycle. It
helps them to shorten the time period of cycle. It takes 30 days to identify a new trend
to deliver the finished product. The other companies take from 4 to 12 months. It is
considered as important trade secret in fashion industry.

Gucci America, Inc. v. Guess Inc.

The Gucci sued Guess asserting that they have imitated certain protected features of
its product like red-green-red stripe and its logos.

In the above self- made diagram, we can clearly see the use of different intellectual property
rights e.g. copyright, trademark and design rights. The design on dress, shoes and hat is
protected by copyright. The LV sign on the purse denotes the brand Louis Viton and how
trademark helps in differentiating one brand from the other. The design of earrings, necklace
is protected by the trade design rights.

Different IPRs:
Design rights
Design rights are important intellectual property rights in the fashion industry. They are a prerequisite
in protecting the appearance of a product the look, design or the structure of the main product can be
ensured such as clothing, handbags, footwear and accessory designs. An unregistered design will be
viewed as new if no indistinguishable design has been made accessible to the general public before
the date on which the designer is claiming the protection. A design is considered to have individual
character if the overall impression of the informed consumers differs from the overall impression by
any design available to the public before it was available.

Branding and trademark

Huge design houses esteem their image value. Most build up a bond with their clients through their
image names and secure these through enlistment of trademarks and insurance of related fine art by
copyright law. Trademarks are just as important for a small or start-up company in the fashion
industry. Trademark helps organizations in separating and situating their item in the business sector.
Shoppers' buying choices are affected by trademarks and the notoriety such brands speak to.

Patents

Patents may not instantly spring to mind when we have to consider the fashion industry. Yet technical
innovation can equally put a fashion business ahead of the competition and differentiate. A strong
portfolio of patents may, for example, reflect technical superiority in inventing new fabrics that don't
wrinkle, or are gentler, or more climate safe, and so on. Such a patent portfolio could draw in business
accomplices or speculators.

Trade secrets and new business models

In some fashion businesses, core trade secrets serve to ensure the computer-implemented, softwarebased business model clarifying the whole business procedure based on speed and stealth to supply a
limited quantity of fashion products.
Customers can design and order apparel directly from the virtual shop. The business depends on
exclusive programming, which is ensured as a competitive innovation and by copyright law.
If another competitive business got a hold of any of these items, it could cause an organisation to lose
market share and dominance, further allowing the other organisation to capture some of their
business.

Copyrights
Copyright is another way designers can protect their designs. It helps in protecting the expression of
idea. Specifically, fabric prints are considered to be an important subject of copyright law for the
pictorial and graphic elements. Recently in few years, copyrights in fabric prints, or the infringement
thereof, have been of increasing concern. Some fashion companies exactly reproduce fabric patterns
designed by others on a regular basis.

In the above picture, we can see that the infringing of fabric print can be done very easily and
therefore it is important to protect the designs by choosing a strong portfolio of intellectual property.

Copying/infringement:

As illustrated in the above Diagram

The fashion industry has been plagued by copying of design logo and the product design.
These are

Counterfeits
Knockoffs

Design copying also called as Knock offs is no less than a crime because it steals the
creators right to obtain the special privileges. While copying of brand logo also called as
Knockoffs is a simple breach of logo or label as the credibility is built on the logo only in
the fashion industry.
The fashion design piracy occurs when there is an infringement of both the concepts, i.e.,
the design logo and the product design.

Protection available to designs in India:

(A) Designs which are capable of being registered under the Designs Act,2000
(1) If registered:
(a)Protection under the Designs Act, 2000 (as per Section 15(1) of the copyright act and
Section 11 of the Design Act :

(i)Nature and scope of protection: copyrights in registered design: exclusive rights to apply design
to any article in any class in which the design is registered.
(ii)Term of protection: 20 years from the date of registration. It is extendable for a period of 5 years.

(b)Protection

under the Copyright Act, 1957 (as per section 15(2) of the copyright Act):

(i)Nature and scope of protection: Copyright in design gives an exclusive right to apply design to
any article.
(ii)Term of protection: Up to 50th reproduction by a process which is industrial of the article to
which the design has been applied.

(B)Designs not capable of being registered under the Designs Act,2000 but are original
artistic works:

Protection under the Copyright Act, 1957(as per Section 23 of the Copyright Act):

(a)Nature and scope of protection: Copyright is original artistic work which gives an exclusive
right to do or authorise doing of any of the acts as mentioned in Section 14(c) of the copyright act.
(b) Terms of protection: lifetime of the author plan: 60 years

CONCLUSION

The global fashion industry has significantly grown in the last few years. It has become an
indispensable part of the global economy and thus requires intellectual property rights protection for
its growth. Fresh and New Designs are cynosure for the Fashion Industry. However, design piracy has
marred the industrys growth. As per research and data available, IPR laws are not stringent enough to
protect Indian Fashion Industry. There is need to ameliorate the current laws and simplified
procedures for design registration to safeguard the interest of creators and inventors in the industry.
From a recent speech made by Infosys co-founder N R Narayan Murthy, "Is there one invention
from India that has become a household name in the globe? Is there one technology that has
transformed the productivity of global corporations? Is there is one idea that has led to an earthshaking invention to delight global citizens? Folks, the reality is that there is no such contribution
from India in the last sixty years,

It can be concluded that India lacks in framing enough government policies and R&D investment
is minimal as compared to other global economies like US and China.
Incorporation of all these suggestions would certainly make the current Indian Intellectual property
regime in the fashion industry more effective and efficient enough to deal with the jeopardy of fashion
design piracy and hence the fashion designers will be encouraged and will ultimately lead to the
growth of the fashion industry.