Dr. Andreas Leupold has been advising and representing clients from Germany, England, USA and many other countries mainly in IT Law, Technology, 3D Printing, Media and Trademark Law, Copyright and Unfair Competition Law.
Dr. Leupold is the editor and co-author of the handbook “3D Printing” which he wrote with a team of over 30 contributors that features industry leaders such as Terry Wohlers of Wohlers Associates and Peter Sander of Airbus Industries. He is a founding member of the supervisory council of the network “Mobility goes additive” initiated by the German Railway Deutsche Bahn. Here, he discusses the importance of protecting intellectual property and data in additive manufacturing.
2018 will be an exciting year for 3D printing. Additive manufacturing (AM) has, for a long time, been mainly used in tool and prototype construction, and it is now moving into series production. Adidas recently announced that in the coming year it will be producing 100,000 Futurecraft sneakers using Carbon’s digital light synthesis technology and Airbus is cooperating with Daimler and the systems producer EOS in the additive mass production of aluminium parts.
These and other developments in AM have not escaped the eyes of lawyers for emerging technologies following market changes and their effects on the legal prerequisites for reducing business risks. With the rapidly advancing industrialisation of 3D printing, the legal questions that these pose are gaining importance, in particular, intellectual ownership of construction data and 3D printable designs and 3D models.
Manufacturers of consumer goods are in danger, not from the private user who prints a spare part for his dishwasher but mainly from product pirates, who, using a 3D scanner and a printer, can carry out reverse engineering on new products or commercially successful products. The problem of counterfeiting is not new, but with this technology, it continually reaches new dimensions. The Gartner study expects that by the end of 2018 3D printing will have led to a loss of intellectual property worldwide amounting to 90 billion Euros.
Also, companies using AM, or companies outsourcing AM, to service providers must ensure that they do not lose the rights to their products. It is not rare that during this work a service provider makes improvements to the construction of the components. In doing so, he can thus obtain the copyright to the work results or can even obtain a patent to these improvements.
Many companies are not sufficiently aware of this possibility and therefore do not think to adequately secure themselves against this using suitable intelligent customised contracts that are concluded in due time before the problem occurs. With such contracts, the allocation of the work results from mutual research and development projects in 3D printing the existing intellectual property (background IP) and the new intellectual property (foreground IP) must be distinguished from one another.
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New risks also result from the fact that 3D printing products are created from data and that principally everyone, who has access to the 3D model or to the printing data and is acquainted with the AM methods, can manufacture the product. In distributed manufacturing, there is no way of avoiding the exchange of data or making it accessible at different production locations. Companies must therefore carefully ensure that their total supply chain does guarantee the necessary and critical data security and that unauthorised persons do not have access to the construction and production data. The new EU know-how protection directive requires appropriate technical protection measures for the protection of business and trade secrets.
Equally as important is the contractual safeguarding using industrial security agreements and suitable non-disclosure agreements (NDA). These must achieve more than the usual confidentiality agreements and NDAs have done up until now. Only a few companies today have an adequate intellectual property policy (IP policy) that does completely meet the changed requirements for protecting business secrets and intellectual property in the context of the digitalisation of the production.
As the construction file and the 3D model are composed of nothing other than data, this data can without exaggeration be termed to be the new crown jewels of the companies. Not infrequently does the 3D model or the construction file contain the blueprint for new products that should be subject to the strictest possible confidentiality measures. Also, during the printing process, large amounts of data are created that are valuable to the business, because they allow statements about the manufacturing parameters and because they are required for quality control.
The EU Commission has recognised that there is a necessity for regulations and is examining whether a new data producer right can be created. At the moment however, whoever has control over the data is de facto its owner and the controller of the data is not always the person to whom or the place where the rights should be rightfully allocated. Companies that want to remain the master of their construction and machine data must therefore carefully contractually regulate, who obtains which rights to data in the digital supply chain.
In the ever-advancing world of industrial 3D printing, this task should be left to legal specialists and lawyers who are versed with the legal pitfalls in formulating corresponding contractual clauses and have knowledge of the 3D printing processes themselves. In any case an attempt should not be made to transfer the ownership of data, which our legal system simply does not (yet) allow for.
Companies that produce replacements or spare parts for their production systems, machines or tools should firstly carry out freedom to operate (FTO) analysis to ensure that they thereby do not infringe the industrial property rights of third parties. Such checks can indeed be complicated; they must include the most different protected rights such as patents, utility models, copyrights, trademarks and design rights. For this reason, this task should be left to experienced in-house counsels or skilled lawyers who have sufficient experience in the practical application of industrial property law in the field of 3D printing.
Service providers who operate internet platforms that offer to users the creation of 3D models themselves must be aware of the risks or the infringement of the protective rights of third parties and their liability for this. The more mainstream the exchange of printing files becomes, the more they must expect to receive cease-and-desist declarations and be made liable for compensation of damages. In my experience as a litigator for one of the world ́s largest marketplace operators, this is something I have seen; the organisation has been subject to such claims and from whom nearly unfeasible obligations to check users were asked.
Due to the disruptive and cutting-edge technology of 3D printing and its effect on many areas of business operations and its consequent changing of processes and logistics, it is advisable for businesses to carry out a legal check with respect to 3D printing, not only for intellectual property but for all areas of the law. You will save a lot of money in the long run, by avoiding potential risks. It makes sense to include an external lawyer experienced in 3D printing in the legal check team as many changes in this rapidly advancing area are not always readily apparent and a question not asked can lead to long-term risks, even in the worst case, to a personal liability of the company management itself.
