1. THEFT OF
INTELLECTUAL
PROPERTY
Janine Hollesen
Follow this event on Twitter: #Cybercrime

2. DIGITAL AGE
Worldwide : 2 billion internet users
Worldwide : 294 billion emails and five billion
sms’s daily
South Africa : end of 2011 = 8.5 million
Increase of 25% from 2010
7.9 million South Africans access internet from
cell phones
New technologies : smart phones, tablets,
flash drives increases the risk of theft and
piracy
Follow this event on Twitter: #Cybercrime
2

3. INTELLECTUAL PROPERTY
 Patents = invention used or applied in trade, industry,
agriculture
 New product, process, device or improvement
 Territorial and registered right
 Trade mark = distinguishing goods and services
 Territorial and registered right
 Designs = appearance i.e. shape, configuration, pattern
or ornamentation of an article manufactured in an
industrial process
 Aesthetic vs Functional designs
 Territorial and registered rights
Follow this event on Twitter: #Cybercrime
3

4. INTELLECTUAL PROPERTY
Copyright
Concerned with works as defined in the
Copyright Act
No registration in SA
General legal requirements are met i.e.
original and in a material form
Protection granted in other territories who are
signatories to the Berne Convention
Literary works – anything that is written
regardless of the literary quality thereof or the
mode or form in which it is expressed
Follow this event on Twitter: #Cybercrime
4

5. COPYRIGHT
 Musical works – music, excluding any words or actions
intended to be sung, spoken or performed
 Artistic work – works of art including drawings,
photographs, works of architecture and works of
craftsmanship
 Cinematograph Film – fixation of material / data /
signals capable of being seen as a moving picture
 Sound recording – fixation of sounds
 Computer programme – set of instructions which directs
the operation of a computer
Follow this event on Twitter: #Cybercrime
5

6. TRADE SECRETS / KNOW-HOW
Trade secrets / Know-how
Trade Secret - information which is not
generally available and which gives the owner
a competitive advantage
Know-how = similar to trade secrets
Body of knowledge, the components of which
may be individually known, but the
compilation has competitive value
Follow this event on Twitter: #Cybercrime
6

7. WHAT CAN BE STOLEN?
Ideas / inventions / creative expressions
Products
Designs
Product specifications
Process information and methodologies
Chemical formula
Manufacturing process
Business method
Follow this event on Twitter: #Cybercrime
7

8. WHAT CAN BE STOLEN?
 Supplier lists
 Parts specifications
 Quality assurance
 Testing procedures
 Research and development outputs
 Product prototypes
 Documents setting out business process methodologies
and corporate strategies
 Business decision-making
 Staff details, including personal information, skill sets and
remuneration levels
 Company capabilities and weaknesses
Follow this event on Twitter: #Cybercrime
8

9. Follow this event on Twitter: #Cybercrime
9

10. TRADE SECRET / KNOW-HOW
Core business asset = company’s
competitiveness to create market advantage
Must be kept a secret
Steps must be taken to ensure security of the
information
Information should be marked “confidential”
Confidentiality / NDA agreements
Duration : For as long as secrecy is
maintained
Follow this event on Twitter: #Cybercrime
10

11. MEASURES
Follow this event on Twitter: #Cybercrime
11

12. EXPLOITATION OF STOLEN IP?
Manufacturing the same product (only if no
statutory IP protection)
Selling the IP - depend on whether the IP can
be commercially exploited
Manufacturing a similar product utilising the
underlying concept without the delay and R&D
costs
Pre-empting a marketing initiative of a rival
Marketing of a product with the same trade
mark prior to the launch of the rival’s product
Follow this event on Twitter: #Cybercrime
12

13. EFFECT OF THEFT AND USE OF IP
Erosion of competitive advantage
Loss of sales
Reputational damage
Reduction in potential investment
Follow this event on Twitter: #Cybercrime
13

14. EXAMPLES
 Former employee was convicted of exporting
sensitive military technology to China
 Thousands of electronic files were stolen from
employer which detailed the performance and
design of guidance systems for missiles, rockets,
target locators and unmanned aerial vehicles.
 The US spends billions of dollars annually on R&D
which if used by a third party could result in rapid
development of rival products without the
significant cost
 Significant penalties and fines in the US
 SA – damages to be proved
Follow this event on Twitter: #Cybercrime
14

15. EXAMPLES
 Pittsburgh Corning Corp : two people charged with
trying to purchase trade secrets for $100,000 to
open rival plant in China
 DuPont, US chemical company : 2 former
employees and a third party conspired to steal
trade secrets about a technology for Panang Group
(one of China’s largest titanium pigment
producers)
 DuPont has also filed a civil case
 DuPont : South Korea’s Industries hired ex-
employees of DuPont to steal confidential
information regarding a particular product. DuPont
was awarded $1 billion in damages
Follow this event on Twitter: #Cybercrime
15

16. CONCLUDING REMARKS
 The pervasiveness of digital platforms
 Increase in internet users
 Introduction of new technologies
 The speed with which information can be exchanged
 Contributory factors to assist in the age old crime of
stealing, with the utilisation of sophisticated methods
Follow this event on Twitter: #Cybercrime
16

17. THANK YOU
Janine Hollesen
11 October 2012
Nothing in this presentation should be construed as formal
legal advice from any lawyer or this firm. Readers are
advised to consult professional legal advisors for guidance
on legislation which may affect their businesses.
© 2012 Werksmans Incorporated trading as Werksmans
Attorneys. All rights reserved.
Follow this event on Twitter: #Cybercrime