Intellectual property risk, strategy and brand clearance: lessons from the OpenAI dispute
Intellectual property (IP) is often one of a business’s most valuable commercial assets. Whether launching a new product, rolling out a rebrand or acquiring another company, early and thorough IP due diligence is critical to protecting brand value and avoiding costly disputes. A failure to carry out appropriate trade mark searches, IP audits and clearance exercises can expose businesses to injunctions, forced rebrands, delayed product launches and significant reputational damage. This article considers the IP lessons arising from the widely reported OpenAI dispute and explains why a structured IP strategy should be embedded at the outset of any major commercial project.
Why IP due diligence matters
Before launching a new product or completing an acquisition of a company, it is essential to carry out thorough intellectual property (IP) checks and brand clearances. This typically includes trade mark clearance searches, ownership checks, licensing arrangements and an assessment of how IP rights align with the company’s wider commercial strategy. Whether it is a brand name, a logo, software code, or product design, early due diligence helps ensure that new projects and ventures are built on solid legal grounds. Overlooking these steps can lead to disputes that are both disruptive and expensive. Even where a business has significant internal resources, unresolved IP risks can quickly escalate into litigation, regulatory intervention or emergency injunctive relief.
The OpenAI dispute: a cautionary example
A recent example that highlights the risk of skipping or underestimating this process is the legal dispute between OpenAI and audio technology company iYO. Following OpenAI’s acquisition of the US based firm io Products, the company quickly became involved in a trade mark dispute in the United States. The case shows how even well-resourced teams can face avoidable IP issues when trade mark clearance is not fully explored.
In June 2025, a US court ruled that iYO had a “strong enough case to proceed” and issued a temporary injunction requiring OpenAI to stop marketing under the “io” name until the matter was resolved. In response to the order, OpenAI removed promotional material and references to the venture from its website - including its original announcement page - and published a notice acknowledging the court’s decision.
Strategic implications for businesses
In such situations, companies may be forced to revisit their branding strategy and, if the legal challenge succeeds, may need to rename or redesign the product entirely.
From a UK IP perspective, the OpenAI case highlights the importance of carrying out a full intellectual property audit and clearance exercise before product development or acquisition. Had this been done, it is likely that it would have identified the earlier trade mark right and helped avoid the dispute.
Taking a proactive IP strategy
A proactive IP strategy is not limited to trade mark registration alone. It involves aligning IP protection with commercial objectives, territorial expansion plans and long-term growth strategy. Businesses operating locally in Gloucestershire and the South West, as well as those trading nationally and internationally, face increasingly complex IP landscapes and require advice that is both technically robust and commercially grounded.
BPE advises clients across a broad range of sectors on IP strategy, trade mark protection, brand clearance, IP disputes and enforcement. Riyaz Jariwalla, Partner and Head of the Commercial Litigation team, also acts as a specialist IP lawyer within the firm, advising businesses on contentious and non-contentious IP matters, including complex trade mark disputes and strategic IP risk management.
How BPE can help
If you or your business is developing a new product, planning a rebrand, or considering an acquisition, now is the time to identify and resolve potential IP risks — not after launch. Carrying out the right searches and legal checks at the start can save significant time, legal costs, and disruption later on. BPE’s Commercial Litigation and IP specialists work with businesses in Cheltenham, Gloucestershire, the South West and nationally to deliver clear, practical advice on IP protection and enforcement. Click here to speak to a member of the team.
