cle - introduction to ip law

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An Introduction to Intellectual Property LawProtecting your Clients Most Valuable Assets

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Question: Why should I even care about intellectual property (IP)?

Answer: MONEY IP is very likely the most valuable part of your clients business.

Common Questions

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Asset Components of S&P 500 Market Value*Source: Ocean Tomo

Specific Example

Motorola

PatentsBuys$12.5 Billion

Sells

Lenovo$2.9 BillionNo!Keeps

$10 Billion Loss?

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Value of IPStartup Financing- Investors want to make sure that the business is protecting the IP.May want to know what IP the business has and how it is being protected.May require a collateral interest in the IP (security interest).

Preserve and Grow Market Share- Legal Barrier to Entry

Selling the Business- IP Due Diligence (e.g., IP list)Purchaser may require a warranty for any defects in the IP.IP problem have and will kill deals!

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ExampleTrademarksSelling$10s Millions

Company A

Company BIP Warranties

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Question: Why do I need to worry about IP-- my clients business is not a technology business?

Answer: It is a common misconception that IP law only concerns inventions and technology (i.e., patents). In fact, almost any business needs some form of IP protection.Business/product name- trademarks.Appearance of products, websites, sales materials, restaurant space, etc.- copyrights, trademarks, & design patents.Financial information, customer lists, & price lists- trade secrets.

Examples of businesses with valuable IP (not in the tech business).

Common Questions

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Question: Why should my client care about getting sued over IP the general business insurance policy should cover it?

Answer: Typically, most business insurance policies do not cover patent infringement lawsuits and usually have carve outs for trademark and copyright infringement lawsuits as well.

You generally need to purchase a separate policy to cover IP infringement lawsuits, especially for patents.

Common Questions

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Different Types of Intellectual Property Rights

Technology/InventionPatentsU.S. Patent No. 1,234,567+ Industrialdesigns

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Question: I heard that you cant get patent protection for (fill in the blank)?

Answer: Generally, speaking you can get patent protection for any invention that is new and nonobvious. There are a few exceptions where you cannot get patent protection, such as for laws of nature, abstract ideas, criminal tools, and perpetual motion machines.Although you can receive patent protection for them, there are certain types inventions that might be better protected with other forms of intellectual property, such as trade secrets for industrial chemical/manufacturing processes.Common Questions

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Different Types of Intellectual Property Rights

Name/Source-Good willTrademarks = Federally Registered = common Law

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Trademark

Word,Symbol,Etc.Goodsor Service(for)

Trademark

TrademarkCadillac(Alone)Trademark

TrademarkCadillac(Alone)

?

Trademark

Cadillacfor Cars

Trademark

Cadillacfor CatFood

Trademark

Trademarks- What are Some Types?Trademark identify the source & qualities of goods (cars, clothing) (e.g., Coke for soft drinks)

Service Mark identify the source & qualities of services (accounting, restaurants,) (e.g., McDonalds for fast food services)

Trade Dress - packaging or form of the product that operates to distinguish source/quality of the goods (e.g., Coke bottle)

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Ownership: TrademarksTrademark = Word, symbol, sound, or other device a manufacturer or merchant adopts to identify and distinguish their goods or services from others.

A Trademark is Different from a Trade Name

Trade Name = The official (legal) name of the business/organization, usually registered with the government.Although different, part or all of the Trade Name might be used as a trademark.

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Trademark v. Trade NameExamplesFord Motor Company

Trade Name

Trademarks

Trademark Incorporates part of Trade Name

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Different Types of Intellectual Property RightsCreativeWorks

Copyrights

Advertising,Marketing,Software, etc.

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Different Types of Intellectual Property RightsValuableSecrets

Trade SecretsCustomer Lists,Business Plans,Financial, etc.

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How Do You Obtain US Protection?Patents: Registration required (filing an application).

Trademarks: Registration not required but recommended.

Copyrights: Registration not required but recommended.

Trade Secrets: No registration process.

RegistrationRequiredNo Registration

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How Long Does the Registration Process Last?LongShort

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Common Questions

Question: Why do I need to file a federal trademark registration couldnt I just use it or file a state registration or rely on common law rights?

Answer: In the big picture, federal trademark registrations are relatively inexpensive (typically, just a few $100s) and provide several significant advantages, including:Protection throughout the United StatesIncreases marketability and licensing value of markDecreases chance a competitor will adopt a similar markAbility to recover lost profit damages in federal courtPrevent importation of infringing goodsAbility to depreciate value of trademark for federal taxes

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Trademarks- Consider Federally RegisteringMarks that have significant value for clients business.

Brands Used Outside the USGenerally, most countries require registration to enforce your trademark

ExamplesCorporate BrandHouse BrandsProduct Brands (with significant sales)

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Trademarks- Do Not Need to Register Them AllGenerally, only register marks with long term value for clients business.Remember you still have common law rights in the US to the mark even if you dont register it.

Trademarks that you might not need to registerOne-off, short term product or serviceLow value to the business

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Question: Why do you need to register a copyright?

Answer: You receive copyright protection for the work as soon as it is created, but if you are a US national, you need to register it in order to:Sue for damagesReceive attorneys feesBlock importationsAlthough registration is inexpensive, you do not need to register every work, only the ones you think are valuable to the business and/or competitors. Common Questions

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How Much Does Obtaining Protection Cost? (Legal Costs)Patents: Expensive- thousands of dollars.

Trademarks: Not cheap- hundreds of dollars.

Copyrights: Cheap- tens of dollars.

Trade Secrets: Free- no registration process (but might cost a lot to keep the secret from others).

ExpensiveInexpensive

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Who Can Handle the Registration Process?

Similar to Maintenance/RepairSome things you can do yourself.Other things you should get an expert.

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How Do You Obtain Foreign Protection?Patents: Foreign applications generally need to be filed within 1 year of earliest filed application (6-month deadline for design patents).

Trademarks: Foreign applications generally need to be filed within 6 months of earliest filing date in order to gain priority date.

Copyrights: Registration generally not required.

Trade Secrets: No registration process.

RegistrationRequiredNo RegistrationWarning: Very Simplified!

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Question: Why should I even care about foreign trademark protection, my client is in Indiana?

Answer: Most countries grant trademark rights based on the first to register the mark and not based on who is using the mark.

Common practice in China is for Chinese distributors or manufacturers to register the US trademark in China before approaching the US trademark holder.

Recently, there has been string of trademark squatters for US marks in Cuba. Common Questions

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How Long Do You Receive Protection?

Patents: 20 years from earliest filing date.

Copyrights: depends, about 70-120 years.

Trademarks: Forever, if you continue to use it.

Trade Secrets: Forever, if it remains a secret.

ShorterLonger

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Trademarks- How Long Do Trademarks Last?Common law rights generally last as long as trademark continues to be used in commerce Registrations typically need to be renewed every 10 years

Rights can be lost if:Expressly abandon the markMark becomes generic ( aspirin, Xerox, Kleenex)Stop using and do not intend to reuse, presumed after 2 yearsAllowing loss of distinctiveness by not enforcing infringement

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What is Typically the Most Valuable IP Asset?For most companies, trademarks (i.e., their good name) are the most important.

However, value can quicklychange due to other factors!

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Trademarks- SelectingBefore using a valuable trademark (or trade name) strongly consider having a trademark clearance search performed.Considerable liability risk

Initial Clearance ConsiderationsCheck Domain Name AvailabilityPerform Web SearchCheck Federal Trademark Registrations- tmsearch.uspto.govCheck Secretary of State

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UnsearchableUsesTrademark Searching

Yellow Pages,Web, Directories, etc.

State Reg.FederalReg.

Trademark Protection

Overview of US Trademark Prosecution

Every application has one or more filing basesIntent-To-Use (ITU)- want to use the trademark.Us

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