FDs warned over threat of digital litigation

Finance directors at companies with online products and services face a
growing risk of litigation from ‘digital ambulance chasers’ amid confusion over
copyright law, Deloitte has warned.

In a report on the top trends in the technology industry this year, It said
FDs should work with in-house lawyers and intellectual property experts to scan
for potential legal threats.

The firm predicts that legal claims over copyright abuse for media, software
and other forms of intellectual property may amount to billions of pounds.

‘The economic outlook may make companies and individuals especially
aggressive in their pursuit of such issues as copyright infringement and digital
ownership rights by country and industry,’ said Jim Sloane, lead technology
partner at Deloitte.

Companies in the technology, media and pharmaceutical industries, which rely
on innovative technology and research are particularly vulnerable to litigation.

Recent high-profile disputes over intellectual property include disputes over
content on YouTube, cybersquatting on domain names and the copying of photos
from Flickr and wiki and blog sites with other ‘user-generated’ content.

‘A trade mark or patent held in one country might not be registered
elsewhere’, said Elizabeth Gutteridge, partner in the forensic practice at
Deloitte specialising in intellectual property.

The legal framework in the UK governing copyright for materials in digital
form stems from the Copyright, Designs and Patents Act 1988 and how this relates
to machine-readable content.

The report also highlights the growing cost of storing data. In 2009 the cost
of keeping servers powered-up and cooled globally is forecast to increase by
over 15%, to $35bn. Companies can cut costs by using ‘de-duplication’ technology
and reviewing email, which is estimated to take up 25% of the available

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