Enom 2010 Annual Report Download - page 39

Table of Contents
and technical measures to protect our proprietary rights. As of December 31, 2010, we have been granted eight patents by the United States Patent and
Trademark Office, or USPTO, and we have 20 patent applications pending in the United States and other jurisdictions. Our patents expire between 2021 and
2027. We rely more heavily on trade secret protection than patent protection. To protect our trade secrets, we control access to our proprietary systems and
technology and enter into confidentiality and invention assignment agreements with our employees and consultants and confidentiality agreements with other
third parties. Effective trade secret, copyright, trademark and patent protection may not be available in all countries where we currently operate or in which we
may operate in the future. Some of our systems and technologies are not covered by any copyright, patent or patent application and, because of the relatively
high cost we would experience in registering all of our copyrights with the United States Copyright Office, we generally do not register the copyrights
associated with our content. We cannot guarantee that:
our intellectual property rights will provide competitive advantages to us;
our ability to assert our intellectual property rights against potential competitors or to settle current or future disputes will not be limited by our
agreements with third parties;
our intellectual property rights will be enforced in jurisdictions where competition may be intense or where legal protection may be weak;
any of the patents, trademarks, copyrights, trade secrets or other intellectual property rights that we presently employ in our business will not
lapse or be invalidated, circumvented, challenged or abandoned;
competitors will not design around our protected systems and technology; or
we will not lose the ability to assert our intellectual property rights against others.
We have from time to time become aware of third parties who we believe may have infringed or are infringing on our intellectual property rights. The
use of our intellectual property rights by others could reduce any competitive advantage we have developed and cause us to lose advertisers and website
publishers or otherwise cause harm to our business. Policing unauthorized use of our proprietary rights can be difficult and costly. In addition, it may be
necessary to enforce or protect our intellectual property rights through litigation or to defend litigation brought against us, which could result in substantial
costs and diversion of resources and management attention and could adversely affect our business, even if we are successful on the merits.
Confidentiality agreements with employees, consultants and others may not adequately prevent disclosure of trade secrets and other proprietary
information.
We have devoted substantial resources to the development of our proprietary systems and technology. Although we enter into confidentiality agreements
with our employees, consultants, independent contractors and other advisors, these agreements may not effectively prevent or provide remedies for
unauthorized disclosure of confidential information or unauthorized parties from copying aspects of our services or obtaining and using information that we
regard as proprietary. Others may independently discover or develop trade secrets and proprietary information, and in such cases we may not be able to assert
any trade secret rights against such parties. Costly and time-consuming litigation could be necessary to enforce and determine the scope of our proprietary
rights, and failure to obtain or maintain trade secret protection could reduce any competitive advantage we have and cause us to lose customers and
advertisers, or otherwise cause harm to our business.
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