IP

Intellectual Property

From trademarks, patents, copyright and trade secrets to rights issues in the age of generative AI—IP strategy that keeps your business moving.

Key Points

  • Using data to train generative AI is generally permitted under Article 30-4 of Japan's Copyright Act, but the exception does not apply where it "unreasonably prejudices the interests of the copyright holder." The practical key is drawing a clear line in an internal usage policy.
  • With open-source software, failing to check the reach of copyleft terms (e.g., GPL) at the product-architecture stage can trigger an obligation to disclose your own source code.
  • To qualify as a trade secret under the Unfair Competition Prevention Act, information must satisfy three requirements—controlled as secret, useful, and not publicly known. Managing departing employees turns on well-designed work rules and the agreements entered into with them on departure.
  • Japan's Copyright Act, U.S. fair use, and the extraterritorial reach of the EU AI Act apply different standards, so global rollouts require evaluating each jurisdiction in parallel.

Introduction

Intellectual property (IP) is one of the most valuable assets in modern business, yet protecting and leveraging it demands a high degree of specialized expertise. For startups, IP constitutes the very value of the enterprise; for technology companies, it is the wellspring of competitive advantage; and for companies pursuing overseas expansion, a strategy for securing rights across borders can determine success or failure.

Beyond the traditional IP areas of trademarks, patents, copyright, designs, and trade secrets, our firm advises on the issues unique to the digital age—the ownership of AI-generated works, the handling of training data in machine learning, and the management of open-source software licenses—grounded in both Japanese and U.S. legal systems.

In recent years, the rapid spread of generative AI has driven a sharp increase in new needs, such as establishing guidelines for corporate use of tools like ChatGPT, managing confidential information contained in prompts, and assessing copyright risk in AI outputs. Our firm works with clients on these cutting-edge issues to craft solutions that are practical and do not impede business momentum. An international perspective is indispensable here as well—the appropriate use of Article 30-4 of the Japanese Copyright Act (use for information analysis), comparison with the U.S. fair use doctrine, and the extraterritorial reach of the EU AI Act.

Areas of Practice

The matters our firm handles in the IP field are as follows.

1. Trademarks - Developing domestic trademark filing strategy (class selection, distinctiveness assessment, prior-mark searches) - Responding to trademark infringement (cease-and-desist letters, negotiation, litigation, customs seizures) - Brand portfolio management and support in implementing trademark watch services - Drafting and reviewing license and franchise agreements

2. Patents - Participating in invention-mining meetings and developing filing strategy - Patent infringement negotiations, invalidation trials, and correction trials - FRAND-terms negotiations concerning standard-essential patents (SEPs) - Designing invention-ownership clauses in joint research and development agreements

3. Copyright - Licensing agreements for software and content - Licensing of AI training datasets and rights clearance for outputs - Open-source license (GPL, Apache, MIT, etc.) compliance - Responding to copyright infringement claims and handling DMCA notices - Rights coordination for derivative and compilation works

4. Trade Secrets and Know-How - Building trade-secret management systems under the Unfair Competition Prevention Act - Responding to information taken by departing employees; litigation over breach of non-compete obligations - Drafting, negotiating, and establishing operational rules for NDAs (non-disclosure agreements)

5. Designs and Publicity Rights - Design registration strategy for product design - Agreements for the use of the likeness of influencers and public figures

How We Approach Typical Matters

The following illustrate the kinds of matters we handle and how we would approach them. They are not descriptions of past engagements or results.

Scenario 1: Copyright Risk Assessment for AI-Generated Content

When a media company considers a company-wide rollout of a generative AI tool for its editors, the questions that arise are the ownership of generated articles and images, the risk of similarity to third-party works, and exposure to infringement risk contained in the training data.

In such a matter we provide integrated support: (1) formulating internal usage guidelines; (2) offering a framework for assessing copyright eligibility based on the degree of human involvement; (3) designing an escalation flow for cases where third-party infringement comes to light; and (4) negotiating indemnity provisions in the vendor's terms of use. Our advice is informed by the scope and limits of Article 30-4 of the Japanese Copyright Act and by developments in U.S. fair use case law.

Scenario 2: Responding to Technical Information Taken by a Former Employee

Where a departed engineer is suspected of having joined a competitor and taken technical information relating to a proprietary manufacturing process, the need to preserve evidence and to decide quickly whether to seek injunctive relief arises.

In this situation we proceed, as circumstances require, by (1) directing an internal digital forensics investigation; (2) pursuing court procedures to preserve evidence; (3) issuing a cease-and-desist letter to the new employer; and (4) filing for a provisional injunction under the Unfair Competition Prevention Act. In parallel, we support the preventive side: reviewing trade-secret management rules, improving access-privilege controls, and revising departure undertakings.

How to Engage Us

  1. Initial Consultation (first 30 minutes free / available online): We listen to your business, your current challenges, and the goals you are aiming for. A confidentiality agreement can be concluded before the consultation.
  2. Estimate and Proposal: Based on the consultation, we present the scope of work, an anticipated timeline, and a fee estimate. We accommodate time-charge, per-matter, and retainer arrangements alike.
  3. Commencement and Progress Sharing: Once work begins, we provide regular progress reports and issue analysis, escalating matters requiring a decision at an early stage.
  4. Completion and Aftercare: Even after a matter concludes, we can provide continued support on related issues and matters requiring ongoing management (such as trademark renewals).

Contact

For consultations in the IP field, please reach out via our contact form. Through an initial hearing, we will consider the optimal approach together with you.

Frequently Asked Questions

Q.At the early startup stage, what should we do first with respect to IP?
The top priorities are three: (1) trademark searches and filings for your key brand names; (2) trade-secret management for your core technology and know-how; and (3) IP-ownership agreements with founders and early members. Because IP due diligence is invariably conducted at each stage of fundraising, M&A, and IPO, keeping records from the very beginning is essential.
Q.I hear I can file a trademark myself—what is the benefit of retaining a lawyer?
You can indeed file on your own, but there are significant differences in (1) the strategy behind class selection; (2) distinctiveness assessment; (3) responding to grounds for refusal; and (4) rights design that anticipates future infringement response and license use. For trademarks that go directly to your business value, expert strategy planning offers superior return on investment.
Q.I want to obtain trademarks abroad—where should I start?
First, narrow your priority countries under your business plan to three to five. For Madrid Protocol member states, you can file a single bundled application based on your Japanese trademark, which is advantageous in both cost and management. The U.S., China, the EU, and most major Southeast Asian countries are members.
Q.May we use images or text created with generative AI for commercial purposes?
As a general matter, you must examine on a case-by-case basis: (1) the terms of use of the AI service you are using; (2) whether the output qualifies as a copyrighted work; and (3) similarity to third-party works. Our firm supports the formulation of internal guidelines and risk assessment of individual matters.
Q.A competitor may be infringing our patent. How should we respond?
First, we conduct an infringement analysis (claim construction, satisfaction of the claimed elements, and application of the doctrine of equivalents) and then organize the business response strategy (cease-and-desist → negotiation → litigation, license negotiation, and invalidation risk). Because a careless demand letter carries risks to business relationships and to reputation, a strategic design is necessary.
Q.We incorporate open-source software into our products—are there risks?
The obligations vary greatly by license type (GPL-family, Apache-family, MIT-family, etc.). Copyleft licenses in particular (GPL, AGPL) may give rise to an obligation to disclose your own code, so taking inventory early in the product lifecycle is recommended. We can also assist with preparing an SBOM (Software Bill of Materials).
Q.What points require attention when concluding a copyright assignment agreement?
The central issues are: (1) a special covenant not to exercise moral rights; (2) an explicit assignment of the right to create derivative works; (3) the adequacy of consideration; and (4) warranty clauses where third-party works are included. In contracts with freelance creators, attention must also be paid to the application of the Subcontract Act and the new Freelance Protection Act.
Q.Is it necessary to review our IP portfolio periodically?
We recommend it. The rights you should hold shift with business pivots, overseas expansion, and changes in the competitive landscape. Through an annual inventory, we recommend addressing: (1) maintain-or-abandon decisions; (2) additional filing needs; (3) opportunities to monetize through licensing; and (4) dispute-risk assessment.
Q.We are an SME and cannot afford to spend on IP strategy. How should we think about priorities?
Start from the question, "What differentiates our business?" If it is brand-driven, focus on trademarks; if technology-driven, on patents or trade secrets; if content-driven, on copyright. Rather than trying to secure everything, it is realistic to start by securing three to five rights that serve as barriers to competitor entry.
Q.In the IP field, how does retaining a New York–admitted attorney help?
Coordination with local counsel when entering the U.S. market, a practical understanding of U.S. litigation and USPTO procedures, cultural fluency in contract negotiations with U.S. companies, and the ability to draft English-language contracts all offer practical benefits. Please see the "International (New York Law)" practice area for details.
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