Intellectual Property Issues

Women’s Business CenterKauffman FastTrac

Types of Intellectual Property• Trademarks

- Source indicators

• Copyrights- Works of Authorship: *Writings *Music *Software

Types of Intellectual Property

• Patents- Inventions: *Processes/Methods *Machines/Devices

• Trade Secrets- Confidential information which has economic value: *Formulas *Customer lists *Manufacturing processes

TRADEMARKS

Trademarks• Trademarks

- Assets of a Business – Both as property and as goodwill- family of marks- slogans- designs/icons- product configuration

Examples of well known trademarks:

• Word: WALL STREET JOURNAL, PEPSI• Logo:

• Letters: WSJ• Symbols:

• Sounds: MGM’s Lion Roar, NBC’s chimes

Examples continued:• Slogans/Taglines:

• McDonald’s: I’M LOVIN’ IT!

TrademarksYou should always use a TM symbol with all

trademarks whenever possible. TM may be used for any mark in commerce.

You should always use the registration symbol (®) for registered trademarks.- Removes defense of innocent infringement

Is the Mark Available for Registration or Use?SEARCHES help to determine whether the mark is

available for registration and use– Federal searches [www.uspto.gov]– State searches [secretaries of state] – not tasked

with searching or enforcement– Domain Name searches

• Domaintools.com• allwhois.com

– “Common Law” – internet, phone books, business names

– Proprietary Databases – CT Corsearch, Thomson

Trademark Protection• Trademark Rights Acquired Through Use

of the Mark in Commerce– Common law rights – can use the ™ symbol– Limited to geographic region in which mark is

used– Enforcement through state common law

usually via unfair competition statute

Trademark Protection

• State protection - benefits– Constructive notice in the state of the

trademark owner– Evidence of local ownership of the trademark– Jurisdiction of state courts may be invoked– Enforcement through state statutes –

counterfeiting, trademark infringement, dilution

– **Filed application with the Secretary of State– (Not as valuable as a federal registration)

Trademark Protection• Federal protection/registration – benefits

– mark is in Patent and Trademark Office where others will find it in making a search

– gives rights to use the mark throughout the United States except as against prior users in their areas of use, regardless of owner-registrant’s actual area of use;

– after five years exclusive and continuous used mark and its registration are incontestable*; and

– constructive notice nationwide of the trademark owner's claim

Trademark Protection• Federal protection – benefits (continued)

– Evidence of ownership of the trademark– Jurisdiction of federal courts may be invoked– Registration can be used as a basis for

obtaining registration in foreign countries– Registration may be filed with U.S. Customs

Service to prevent importation of infringing foreign goods

– Domain Name rights - Ability to receive special rights with regard to domain names

– **Filed with the U.S. Patent and Trademark Office (“PTO”)

Federal Trademark Protection1. Trademarks Must be Distinctive

A. Inherently Distinctive Marks– Fanciful: no other meaning than its meaning as a

trademark [STARBUCKS, LEGO, VERIZON]

– Arbitrary: words with separate meaning, but nothing to do with the associated product/service [CAMEL for cigarettes, APPLE for computers]

– Suggestive: suggest a characteristic of a good or service without actually describing that characteristic. [COPPERTONE for sunblock, EARTHLINK for internet service, JETBLUE for airline service]

Federal Trademark Protection1. Trademarks Must be Distinctive (continued)

B. Descriptive: - merely identifies a characteristic of the article or service it marks [WORLD WATERPARK ASSOCIATION]

• A descriptive mark entitled to federal protection only if it acquires distinctiveness (aka secondary meaning)

» Shown through long-term use, advertising expenditures, sales revenue, testimonials, etc.

C. Generic: - never entitled to trademark protection, i.e. “laptop computer” [ASPIRIN, ELEVATOR, CELLOPHANE, YO-YO, GOOGLE?]

• Famous marks must ward against genericide

Federal Trademark Protection2. Trademarks Must Not be Confusingly Similar to

Other Marks- Factors to consider: In re E.I. DuPont du Nemours & Co., 476 F.2d 1357, 177 USPQ 563 (CCPA 1973)A. visually, audibly, or phonetically similar?B. are the goods/services related or competing?B. trade channels overlap?C. sophistication of consumers

Other factors too.**Notably, PTO Examiners will only search PTO

database for pending/registered marks

Federal Trademark Protection

After used in interstate commerce, an application based on first use may be filed; or an intent-to-use application to “reserve” the mark without first making use of the mark may be filed, (although use is required before the registration will be issued)

Federal Trademark ProtectionDuration – How long does a federally registered TM

last?Potentially forever if:(a) continuous use exists;(b) mark does not become a generic description of the product;(c) maintenance between 5th & 6th year of registration;(d) renewals are filed every 10 years;(e) all licensing of the mark is done with quality control; and(f) there is no acquiescence to infringement.

Trade DressTrade Dress refers to the characteristics of visual appearance of a product or its packaging that signify the source of the product to consumers. 15 USC § 1125(a)

packaging product configuration/design

Trade Dress• May be registered with the U.S. Patent

and Trademark Office• A trade dress may not be “functional”• Packaging may be inherently distinctive

or acquire distinctiveness• Product configuration cannot be

inherently distinctive, but can acquire distinctiveness

• Many of the same rights and benefits that apply to trademarks also apply to trade dress

Federal Protection:Protect against infringers who use confusingly similar marks

Claim of Trademark Infringement 15 U.S.C. § § 1116 and 1117 (a) action can be in federal court for federally-registered mark, they have original jurisdiction;(b) relief available for trademark infringement:

(1) injunction;(2) actual damages (including infringer’s

profits);(3) attorneys’ fees for exceptional cases; and(3) destruction of infringing inventory.

Federal ProtectionClaim of Counterfeiting:• a counterfeit (copy) of a mark that is registered on

the Principal Register in the United States Patent and Trademark Office for such goods or services sold, offered for sale, or distributed and that is in use, whether or not the person against whom relief is sought knew such mark was so registered…. 15 U.S.C. § 1116

• In addition to above remedies, may seek statutory damages for up to $1 million

Federal ProtectionClaim of Dilution: 15 U.S.C. § 1125(c)

• Even if a mark does not infringe another’s trademark (or is not confusingly similar), a trademark owner may still have a cause of action for the loss of the trademark’s ability to clearly identify one source.

• requires proof that: (1) the mark is famous, (2) the defendant is making use of the mark in commerce, (3) the defendant's use of the mark began after the mark became famous, and (4) the likelihood of dilution

Federal ProtectionClaim of Dilution: 15 U.S.C. § 1125(c) (continued)• Usually occurs through blurring or tarnishment

– “blurring” is “association arising from the similarity between a mark or trade name and a famous mark that impairs the distinctiveness of the famous mark” 15 U.S.C. § 1125(c)(2)(B) [Buick aspirin, Kodak pianos]

– “tarnishment” is “association arising from the similarity between a mark or trade name and a famous mark that harms the reputation of the famous mark.” 15 U.S.C. § 1125(c)(2)(C)

• Products of shoddy quality, portrayed in an unwholesome or unsavory context

Domain Names

Claim of Cybersquatting 15 U.S.C. § 1125(d): registering, trafficking in, or using a domain name with bad faith intent to profit from the goodwill of a trademark belonging to someone else

– “typosquatting” [i.e., www.kleeneks.com]Domain Name Disputes

– Arbitration proceeding and is relatively inexpensive– Usually involves 1 complaint and 1 response and then

decision by appointed arbitrator- can have oral argument before some tribunals- no discovery

** key hurdle in both scenarios is that the Respondent must have acted in bad faith

COPYRIGHT

CopyrightsCopyrights exist upon creation; benefits of federal registration– Anything that contains creative

expression, i.e. advertisement, software, website, movies, songs

– May immediately use the copyright notice, i.e. © 2012 HOVEY WILLIAMS LLP

REQUIREMENTS FOR COPYRIGHT PROTECTION• Work of original creative authorship• Fixed in a tangible form of expression

from which it can be perceived, reproduced, or otherwise communicated, directly or with aid of a device

Copyrights1. literary works - fiction and nonfiction books,

manuscripts, computer programs, manuals2. musical works (and accompanying words) -- songs,

operas, and musical plays 3. dramatic works -- including music - plays and

dramatic readings 4. pantomimed and choreographed works 5. pictorial, graphics, and sculptural works – photos,

maps, globes, charts, technical drawings, diagrams, and models

6. motion pictures and audiovisual works7. sound recordings and records – digital recordings,

CDs, MP3s, and tapes

EXCLUSIVE RIGHTS IN COPYRIGHTED WORKS• Right to Reproduce or copy• Right to Distribute• Right to Display• Right to Perform• Right to Make Derivative Works

Copyright Protection• Unregistered Copyright

– Author owns immediately

• Registered CopyrightAuthor or owner may register copyright to avail itself of statutory rights- Ability to sue for infringement- Statutory Damages (Requires Timely Registration)• Up to $30,000/infringing work• Up to $150,000 for willful infringement of work• Attorneys’ fees/legal expenses

Why Register?• Proof of ownership

– If you don’t register within five years of creating the work, the court doesn’t have to recognize the registration you do file as self evident proof.

• Access to courts• Statutory damages

– Must register within 3 months of publication or before infringement

– Otherwise, only an award of actual damages and profits is available to the copyright owner.

Ownership• Author is the presumptive owner• Transfer of Work

– Work for hire• Employer owns copyrights of employees if work

was prepared “within the scope of employment”• Employer does not automatically own copyrights

for work created by independent contractors, even if employer paid for the work

• If not employer/employee relationship, must obtain a written “Work for Hire Agreement” and must fall within statutorily enumerated categories

• Commissioning Party is considered the author– Assignment (in writing)

• Subject to termination

WORKS MADE FOR HIRE (17 USC § 101)

• Works made by an employee within the course of employment; OR

• Works specially ordered pursuant to a signed written work for hire agreement AND if the works are in eligible categories

WORKS FOR HIRE CATEGORIES• contribution to a collective work• part of a motion picture or other• audiovisual work• a translation• a supplementary work• a compilation• an instructional text• a test or answer material for a test• an atlas

Duration of Copyright• For individual authors, a copyright persists for

the author’s life plus seventy years for works created on or after January 1, 1978.

• For works made for hire, anonymous and pseudonymous works, the duration of copyright will be 95 years from publication or 120 years from creation, whichever is shorter.

• For works created prior to January 1, 1978, the duration of copyright may vary depending upon when the work was created and/or published.

Copyright• Must get permission to use copyrighted

material from the copyright owner or their licensing agent

• Music – compulsory licensing (BMI, Harry Fox Agency, Copyright Office)

• Movies – movie studios• Photographs – stock photo companies

(Getty Images); photographers

Copyright• Certain works are NOT protected by copyright

law• Works that are in the public domain unoriginal

reprints of public domain works• U.S. Government Works

• 17 U.S.C.§ 105: Copyright protection under this title is not available for any work of the United States Government, but the United States Government is not precluded from receiving and holding copyrights transferred to it by assignment, bequest, or otherwise.

Copyright• Facts and ideas 

– While the protection does cover the particular, distinctive words a writer uses to present ideas or facts, control over the underlying concepts or truths cannot be owned. Thus, a biography about a famous athlete qualifies for copyright, but the events and facts of his life do not.

– Feist Publications, Inc., v. Rural Telephone Service Co., 499 U.S. 340 (1991).

• Data is not protected by copyright.– Selection and arrangement of data can be protected by

copyright– However, must have “modicum of creativity”

Unprotectable Works (Examples)

• Works which have not been fixed in a tangible form of expression

• Titles, names, short phrases, and slogans• Mere listings of ingredients or contents• Works consisting entirely of information

that is common property and which contains no original authorship (e.g. height & weight charts, tape measures, calendars, etc.)

Patents

.

PATENTS• Provided for in the Constitution, Article I,

Section 8

• “To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.”

Patent Basics

Patentable Subject Matter Includes…

• “Anything under the sun that is made by man”

• Excludes laws of nature, physical phenomena, abstract ideas

• Statutory classes: process, machine, manufacture, composition of matter

Types of PatentsThere are three types of patents: • Utility Patents are the most common

type of patent• Other patents include:

Design: Protects only the design and not the functional aspect of the invention.

Plant: Only for asexually reproducing plants.

Quid Pro Quo of Patent System

• Limited monopoly in exchange for full disclosure of invention

• Duration of 20 years from effective filing date

• Rationale: information might otherwise be maintained as a trade secret and won’t be contributed to the public store of knowledge.

• Right to exclude – pharmaceutical example

Statutory Requirements for Patentability• Novel: loosely means that the invention is

new and is not identical to the previous work of others. (35 USC § 102)

• Non-obvious: means that the invention must not be an obvious extension of what has gone before. (35 USC § 103)

Obviousness is measured by what one of ordinary skill in the subject area of the patent would have known at the time of the invention.

How long does it take to get a patent?

• Technology Dependent– Computer/Software/Electronic Business

Method• 3 - 5 years (typical)

– Electrical• 2 - 4 years (typical)

– Chemical• 1.5 - 3 years (typical)

– Mechanical• 1.5 - 3 years (typical)

Is getting a patent worth it?• Some Factors to Consider

1. Commercial Value– Market size and acceptance – Profit margin attributable to exclusivity– Likelihood of copying (Barriers to entry: capital, physical, legal, technical)

2. Patentability– Novelty and nonobviousness– Breadth of protection available

3. Licensing Possibilities4. Defensive Use in Litigation and Cross-licensing5. Trade Secret Value/Risk (mostly for internally practiced

inventions)

American Invents Act• Went into effect in March 2013• The most sweeping changes to U.S. Patent Law

in nearly 60 years– from “first to invent” to “first to file”– redefines applicable prior art– establishes new post-grant Patent Office

reviews

Change to “First-to-File” System • Changing from “First-to-Invent” to “First-to-File”

– When you invented no longer matters– When you filed is what matters

• Old Law: “First-to-Invent” (Before March 16, 2013)– If you invented first, but your competitor, who invented later,

beat you to the Patent Office, you were still entitled to the patent

• New Law: “First-to-File” (After March 16, 2013)– If you filed first, you are entitled to the patent, regardless of

when the invention was conceived

Ownership• Inventor(s) versus Assignee(s)

- Owned by the inventor unless there is an

assignment to the contrary or a duty to

assign- Importance of employee agreements to

assign

Protecting an Invention

• Consult with a patent attorney• Beware - Invention Promotion Firms:

– http://www.uspto.gov/inventors/scam_prevention/index.jsp

– www.ftc.gov– www.bbb.org

Resources:

• USPTO website (free)• www.uspto.gov• Free searching -

http://www.uspto.gov/patents/process/search/

Resources:

• Google Patent Search• www.google.com/patents

• “Free Patents Online” website – “pdf” images

• http://www.freepatentsonline.com/search.html

TRADE SECRETS

Trade Secrets

Uniform Trade Secrets Act 1979, 1985*45 States and District of Columbia

•Eligible Subject Matter:- Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and- Is the subject of efforts that are reasonable under the circumstances to maintain secrecy.

Trade SecretsMeasures to Protect ones Valuable Information• Security – as to outsiders• Confidentiality – as to insiders

Information Directed Procedures• Locks, encryption, shredders, separation of

departments

Employee-Directed Procedures• Contracts, “need –to-know,” legends, exit interviews,

reminder letters on termination

Visitor Directed Procedures

Marketing & Other Contractual & Regulatory Relationships

Any Questions?

Crissa A. Seymour Cookccook@hoveywilliams.com

© Hovey Williams LLP 2013

Thank You!

Hovey Williams LLP84 Corporate Woods

10801 Mastin Blvd., Suite 1000Overland Park, KS 66210

913.647.9050