LensCrafters 2011 Annual Report Download - page 110

ANNUAL REPORT 2011> 34 |
there can be no assurance that Group’s employees, contractors or agents will not violate
such laws and regulations or its policies. Any such violations could individually, or in the
aggregate, materially adversely affect its financial condition or operating results.
Additionally, as a US government contractor through its Oakley and Eye Safety Systems
subsidiaries, the Group must comply with, and is affected by, US laws and regulations
related to its government business. These laws and regulations, including requirements
to obtain applicable governmental approvals, clearances and certain export licenses,
may impose additional costs and risks on the Group’s business. The Group also may
become subject to audits, reviews and investigations of its compliance with these laws
and regulations.
k) If the Group is unable to protect its proprietary rights, its sales might suffer, and
Group may incur significant costs to defend such rights
The Group relies on trade secret, unfair competition, trade dress, trademark, patent and
copyright laws to protect its rights to certain aspects of its products and services, including
product designs, proprietary manufacturing processes and technologies, product research
and concepts and recognized trademarks, all of which the Group believes are important
to the success of its products and services and its competitive position. However, pending
trademark or patent applications may not in all instances result in the issuance of a
registered trademark or patent, and trademarks or patents granted may not be effective in
thwarting competition or be held valid if subsequently challenged. In addition, the actions
the Group takes to protect its proprietary rights may be inadequate to prevent imitation
of its products and services.
Its proprietary information could become known to competitors, and the Group may not
be able to meaningfully protect its rights to proprietary information. Furthermore, other
companies may independently develop substantially equivalent or better products or
services that do not infringe on its intellectual property rights or could assert rights in, and
ownership of, its proprietary rights. Moreover, the laws of certain countries do not protect
proprietary rights to the same extent as the laws of the United States or of the member
states of the European Union.
Consistent with the Group’s strategy of vigorously defending its intellectual property
rights, the Group devotes substantial resources to the enforcement of patents
issued and trademarks granted to it, to the protection of its trade secrets or other
intellectual property rights and to the determination of the scope or validity of the
proprietary rights of others that might be asserted against it. However, if the level of
potentially infringing activities by others were to increase substantially, the Group
might have to significantly increase the resources that it devotes to protecting its
rights. From time to time, third parties may assert patent, copyright, trademark
or similar rights against intellectual property that is important to the Group’s
business. The resolution or compromise of any litigation or other legal process to
enforce such alleged third party rights, regardless of its merit or resolution, could
be costly and divert the efforts and attention of the Group’s management. The
Group may not prevail in any such litigation or other legal process or the Group
may compromise or settle such claims because of the complex technical issues and