The Value of Intellectual Property

The Real Value of Modern Companies Isn’t What You Can See

Ask most people what makes a company valuable and they’ll point to physical assets: factories, inventory, real estate, and equipment. But for many of today’s most successful businesses, those assets play a surprisingly small role. The real drivers of value are intangible: intellectual property, brand reputation, proprietary systems, and institutional knowledge.

From Physical Assets to Intangibles

In the mid-1970s, intangible assets made up a small fraction of the S&P 500’s market value. Today, they account for roughly 90%. In sectors like technology, the concentration is even more extreme. Companies such as Apple, Microsoft, and Nvidia derive nearly all of their value from intangible assets, particularly intellectual property and brand strength.

Not All Intangibles Are Equal

“Intangible assets” is a broad category. For some companies, patents are the core driver of value. For others, brand equity, trade secrets, or customer relationships carry more weight. Pharmaceutical companies like Pfizer rely heavily on patented drugs to maintain their competitive edge. A company like Apple holds significant patents but derives much of its value from brand loyalty and the strength of their overall ecosystem of products. For companies like Coca-Cola, brand recognition and proprietary formulas serve as the primary intangibles.

Why It Matters

Oftentimes a company's most valuable assets are the least visible. Intellectual property, brand equity, and proprietary knowledge don’t always show up clearly on a balance sheet but they increasingly drive market performance.

This creates both opportunity and risk for investors. Companies with strong but under recognized intangible assets may be undervalued, while those built on fragile intangibles such as expiring patents or vulnerable brand reputations can lose value quickly.

The Bottom Line

Over the last 100 years we have shifted from an industrial economy to a knowledge-based one. Understanding what a company is truly worth now requires looking beyond physical assets and focusing on the intangible drivers of value.

Understanding Trademark Law for Apparel: Is Your Design a Brand or Just Decoration?

I often get clients that ask me to trademark their clothing brand. Apparel is a unique area of trademark law that requires the consideration of two separate issues. First, will the design actually function as a brand, or will customers see it as decoration? Second, does the design come close enough to someone else’s branding that it could suggest an official connection?

When a Design Works as a Brand

Trademark law protects marks that identify the source of goods. For apparel, the U.S. Patent and Trademark Office (USPTO) looks at how the mark appears on the clothing. The main test is whether an average buyer would see the design as a brand or if is it merely decoration.

For example, a small logo placed on a shirt’s chest or sleeve often signals the brand. Consumers recognize it as a mark showing who made the product. This kind of use usually qualifies for trademark protection. In contrast, large, bold graphics covering much of a shirt are typically considered art or decoration. The USPTO and courts have ruled that such designs usually do not function as trademarks because buyers see them as visual ornamentation rather than branding.

Why This Distinction Matters

• If your design functions as a brand, you can register it as a trademark and prevent others from copying it.

• If your design looks like decoration, the USPTO may refuse trademark registration because it does not identify the source of the goods.

• If your design borrows too much from another brand’s identity, you risk trademark infringement claims, even if your design looks decorative.

How to Build a Design That Works as a Brand

Brands that want trademark protection should design their marks to clearly identify the source of their products.

• Use distinctive wording or logos that stand out from decorative elements.

• Place marks in typical brand locations, like the chest, collar, or sleeve.

• Avoid making the design the main artistic feature of the garment.

• Consider combining text and graphics in a way that signals branding.

Avoiding Infringement Risks

Even if your design looks decorative, it can still infringe on another brand if it borrows recognizable elements. To reduce this risk:

• Research existing trademarks before finalizing your design.

• Avoid using logos, slogans, or distinctive graphics from other brands.

• Consult a trademark attorney if you are unsure about potential conflicts.

  
  

Final Thoughts

Clothing brands need to separate two key trademark questions: does your design act as a brand and does it avoid copying others’ brands? Understanding this distinction will help avoid trademark office refusals and legal troubles.

Can Consumers Challenge a Trademark?

When a company tried to trademark the name "Rapunzel" for dolls and toy figures, Rebecca Curtin, a law professor and fairy-tale doll collector, saw a problem. She believed no business should claim exclusive rights to a name rooted in public folklore for centuries. Acting on this belief, she filed an opposition with the U.S. Patent and Trademark Office (USPTO). What followed was a long legal battle that ended with the Supreme Court declining to hear her case, leaving a key question unresolved: who has the right to challenge trademarks?

The Legal Battle Over a Fairy-Tale Name

Rebecca Curtin’s opposition was based on the idea that consumers deserve access to products named after traditional fairy-tale characters without one company controlling the market. She argued that as a consumer and collector, she would be harmed by the trademark because it limited competition and choice.

The case moved through the Trademark Trial and Appeal Board and then the Federal Circuit. Both courts applied a legal test from a 2014 Supreme Court decision, Lexmark International v. Static Control Components. This test asks whether the person challenging the trademark falls within the "zone of interests" the law aims to protect.

The courts held that the Lanham Act protects commercial actors, not consumers. Since Curtin’s injury would be indirect, her challenge was dismissed. The ruling means consumers may have limited ability to oppose trademarks in administrative proceedings.

Moving Forward

Rebecca Curtin’s case shows the challenges consumers face in trademark law. It raises important questions about balancing business rights with public access to cultural names. While the Supreme Court declined to hear the case, the conversation about who can challenge trademarks is likely to continue.