IP Drives Innovation in Shoes, Movies and Health Care

By Sheryll Poe (Originally posted on FreeEnterprise.com)

Anytime you base your business model on the fashion whims of teenagers, you know it’s going to be a rough ride, admitted Osiris Shoes President and CEO Tony Chen.

But what Chen didn’t expect was to have to fight a continuous, global battle to protect his innovative designs.

“It’s aggravating and frustrating to see others benefiting from your innovations and designs,” said Chen, who spoke on a November 8 panel during a Global IP Summit put on by the U.S. Chamber’s Global Intellectual Property Center (GIPC). Chen, along with executives from the entertainment and health care industry, were on hand to discuss the role of intellectual property (IP) and innovation.

IP is essential to innovation, economic growth and job creation across different sectors, said Rich Bagger, senior vice president of corporate and strategic market access at Celgene, a health care technology company. “IP is essential and fundamental to innovation, they’re fundamentally connected.”

Beyond innovation, IP is a jobs-related issue. In fact, IP-related industries represent 40 million American jobs. A recent report by The Commission on the Theft of American Intellectual Property found that there would be 2.1 million more jobs in the U.S. if intellectual property rights were strictly enforced and efforts to confront IP theft were better organized.

Brian Keane, COO and executive vice president of Blue Sky Studios Inc., has produced eight feature films, including the Ice Age franchise, noted that his eight films have brought in more than $4.1 billion in worldwide box office sales. The process for creating those family classics is long and arduous and relies heavily on the creative and technological prowess of the company’s 550 employees. “I cannot stress enough the importance of the protection and enforcement of IP as it relates to our product.”

Chen showed the audience knockoffs of some his most popular items, including D3 sneakers and a GBag, which is a backpack with built-in speakers. “They get the benefit from an innovative idea that we came up with.”

Chen wrote in piece that appeared in RealClearPolicy on November 7:

We believe that our company of 20 employees has only begun to make its global footprint. As we continue to grow internationally, safeguarding our intellectual property becomes ever more important.

The challenges of doing so have become all too clear. They are especially felt in places where intellectual-property protection and enforcement is lacking. Russia, for example, was one of our top markets in Europe at one point, but our sales have diminished as counterfeiting has crowded out sales of our legitimate products over the last few years.

Unfortunately, the sale of counterfeit goods is not limited to rogue international markets. Footwear is one of the top counterfeited products sold in the U.S., as evidenced by the staggering $103 million in knockoff shoes seized by Immigrations and Customs Enforcement last year alone. The work done by enforcement professionals is incredibly important to those of us in innovative and creative industries of all shapes and sizes.

Navin Govind, founder of health care technology company, Aventyn Inc., which operates in the U.S., Sweden, the United Kingdom and India, said the problem of protecting intellectual property is most acute in India. “The opportunity is very large, but challenging. From a policy and enforcement perspective, there’s a lot to be done in that country.”

Last year, GIPC released an International IP Index (GIPC Index), Measuring Momentum. The Index set out to create an IP roadmap for key countries around the world to assess their IP systems in order to accelerate economic growth, create jobs, and improve foreign investment. Out of the 11 countries surveyed, India came in last.

“While India’s economic ascent has been nothing short of miraculous, it is imperative that India take into account the importance of ensuring adequate IP rights as it considers expanding their trade and investment relationships globally,” according to Miti Sathe, director of international intellectual property for India and special projects at GIPC.

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