INTELLECTUAL PROPERTY RIGHTS
Trademarks and Service Marks
A “trademark” is a word, name or symbol which is used to identify particular products or services offer by a particular manufacturer or from a particular source. The trademark distinguishes and authenticates a product of a particular manufacturer from similar products offered by others. The owner of a Trademark has the right to prevent others from using the same or similar trademark on their products.
A “service mark” is a form of trademark that is used in the sale or advertising of services. The service mark distinguishes the services offered by one business from similar services offered by other businesses. Both trademarks and service marks can be registered with the United States Patent and Trademark Office – and states can regulate trademarks and service marks used within the particular state.
Before you can register a mark, you must use it, and it must distinguish goods or services from others. You cannot register a mark with the United States Patent and Trademark Office unless the mark is used in interstate commerce. This Federal Act was recently amended to allow registration for up to three years of a mark which has not yet been used in interstate commerce by filing an “Intent to Use.”
Generic terms that merely describe a class of products cannot be registered. For example, the term “motor oil” or the word “airline” would not be registerable. Descriptive or geographical terms cannot be registered unless they have acquired a secondary meaning. A mark acquires a secondary meaning when, through long usage, the public identifies the mark with a particular product. For example, “Best Western” Motels involves a mark which has a secondary meaning.
As stated earlier, registration entitles a person to the exclusive use of a mark. An owner of a mark can enjoin others from using it. This is a Court Order preventing the improper use or duplication of a mark that may confuse the public.
One can be an owner of a trademark or service mark, whether or not it is registered. This is common law protection. Registration is proof of ownership and makes ownership rights easier to enforce. The basic question in lawsuits over marks is whether or not the general public is likely to be confused as to the origin of the service or product. If the owner of a mark permits widespread use of the mark to describe a general class of products, the exclusive right to the mark may be lost. Two examples are “cellophane” and “aspirin.”
Trade dress is the total appearance of a product, including its packaging, label, shape, and size. Trade dress may also include physical structures associated with a particular product or service, such as the “golden arches” of McDonald’s. Trade dress may qualify as a protected trademark or service mark if it is distinctive and identifies the source of a specific product or service.
The Federal Trademark Dilution Act of 1995 forbids the incompatible commercial use of a famous mark or trade name that harms the distinctive quality of the mark. Examples: Cadillac Toilets, Microsoft aspirin, and Hertz bicycles.
A mark is not eligible to be registered if it is:
- immoral, deceptive or scandalous matter,
- flag of coat of arms or other insignia of the United States, or of any state, municipality, or foreign nation,
- a name, portrait, or signature identifying a particular living individual except with that individual’s written consent, or the name, signature or portrait of a deceased President of the United States during the life of the President’s spouse, except with the spouse’s written consent,
- a mark that resembles one already registered that is likely to cause confusion, mistake or deception,
- a mark that is merely descriptive, or a deceptive misdescription, of goods, or primarily a geographical description or deceptive geographical misdescription of goods, or a surname – unless the mark has become distinctive of the applicant’s goods in commerce.
The rights of an owner to his trademark or service mark potentially lasts forever, provided the owner continues to use the mark and complies with renewal requirements. However, if you stop using the mark for three years or more, this may be considered “abandonment” and the owner may lose the trademark unless he can demonstrate a good reason for the non-use. “Three years non-use” became effective January 1, 1996 and results from the Uruguay Round Agreements Act passed in December 1994 to implement the Trade Related Intellectual Property (TRIPs) portion of the GATT Agreement. The time period for abandonment used to be two years.
The owner of a good idea that will be trademarked eventually should be registered as soon as possible after he conceives the idea. For many years it was necessary to first make a bona fide commercial use in interstate commerce of the name or mark before you were able to register a trademark. Only after you made such use, could you file for registration. Changes in U.S. trademark law also permit you to file on the basis of intent to use and to maintain that application for up to three years. However, registration still requires that the applicant prove use has occurred. If you can make legitimate bona fide use, such use will always be preferable to filing an intent to use application, but whatever can be done first should be done immediately.
The Internet, with its fast moving pace, has produced some registration issues. One company came up with a great name and filed an intention to use application, but a second company, without knowing about the filing, came up with the same name and began shipping goods with the name.
The procedure for registration in the U.S. consists of the following: an application for trademark registration occurs before an administrative tribunal. The Trademark Office examines the application and permits it to go forward or denies it. If one loses his arguments for registration, he may then appeal that adverse decision to the Trademark Trial & Appeal Board. After the owner clears the examination hurdle his mark is published in the Official Gazette for Opposition. Third parties may then engage in a trial like proceeding (an Opposition) to prevent the registration of a mark.
However, these are all “administrative” proceedings which affect only registration and not use in the market place. You must go into Federal Court to get an injunction to stop an infringer’s use. Victory in the Trademark Office does not accomplish this.
Searching to see whether or not a trademark is available: you can try to search for a trademark on your own to see if any obvious problem pops up as a first step, but if you expect your business or product to become major, and the name will be important to you, you’ll want to retain an experienced trademark lawyer to do it the right way. If you wish to proceed on your own, the sources you should check include:
- Lexis, Dialog or other computer services which provide on-line searching;
- The Federal Trademark Register, a book, published yearly, which lists all federally registered trademarks (as of the book’s publication date – which means the information is rather stale). Such a search will not pick up the second word of combination marks, nor common law marks. Computer searches are more up-to-date and useful;
- All telephone books in your area and in major cities. Using a CD-ROM of business names is more up to date and comprehensive;
- Trade journals from your industry;
- Trade Associations, which sometimes maintain lists of trademarks in their industry. For example, Pharmaceutical Manufacturers Assn., Tobacco Merchants Assn.;
- State and local assumed name certificates and doing business as filings; and
- Corporate registers in your state and the other 49 states. Please note partnerships, LLPs, LLCs may be listed on separate registers and a corporate name search may not turn up all company names which are registered.
It is also advisable to do a full search using a professional search organizations and an experienced trademark attorney. Such an attorney or organization will search for Federal register and trade journals, telephone books and other “common law” sources. You should also consider searching state trademark registrations and corporate names on the records of each of the fifty states. An experienced trademark attorney is necessary to give you a reliable opinion on just how strong an obstacle may be. There are many ways around an obstacle, and whether or not you can beat a mark which is close, requires an experienced opinion.
Secondary meaning arises when consumers have come to identify a trademark with you over time. In that case a descriptive mark that you would not have been able to register initially may achieve trademark status and be subject to registration, at some time in the future, after sufficient use has been made to prove secondary meaning. The evidence that may be necessary to prove sufficient to meet the threshold required to establish secondary meaning may consist of advertising and sales volume, or consumer surveys.
A copyright offers protection for original works of authorship. Copyright protection affords the author of a copyrighted work with specific rights that the author can give or sell to others or keep for him/herself. The concept of copyright protection in the United States is set forth in the original U.S. Constitution which allows Congress to pass laws that promote and encourage the progress of the useful arts.
A copyright owner has the following rights:
- to reproduce the copyrighted work;
- to prepare derivative works based upon the copyrighted work;
- to distribute the copyrighted work to the public;
- to perform the copyrighted work in public; and
- to display the copyrighted work in public.
- The author also has the right to authorize others to exercise these rights and prevent others from exercising them regarding his or her work.
Ownership of a copyright is not the same as owning an object which has copyright protection. For example, when you buy a book, you get an implied license from the copyright owner to use the one copy you have purchased for the purpose of reading it. You do not have the right to copy it (other than pursuant to the fair use doctrine). Buying a single copy of a work is not buying the copyright in the work.
The fair use doctrine allows reasonable use of copyrighted works (without requiring the author’s permission) for teaching, research, and news reporting. The Federal Act states: “[T]he fair use of a copyrighted work, including such use by reproduction in copies . . . for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright.”
There are four important factors that must be looked at when determining whether or not the fair use doctrine applies:
- the purpose of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
- the nature of the copyrighted work;
- the amount of the portion used in relation to the copyrighted work as a whole; and
- the effect of the use on the potential market for or value of the copyrighted work.
The doctrine of fair use permits reproduction for scholarship and research (among other certain restricted uses), i.e., where we as a society think our general welfare is increased by making information publicly available and useable. This doctrine stops the moment any commercial interest gets involved; so as soon as your use of the copy starts creating any profit from making the copy, you are no longer protected by this safe haven.
Generally, works published after 1922, but before 1978 are protected for 95 years from the date of publication. If the work was created, but not published, before 1978, the copyright lasts for the life of the author plus 70 years. However, even if the author died over 70 years ago, the copyright in an unpublished work lasts until December 31, 2002. And if such a work is published before December 31, 2002, the copyright will last until December 31, 2047.
Remedies available for infringement of intellectual property rights include:
- a Temporary Restraining Order and a Preliminary or Permanent Injunction to prevent and/or stop further infringement.
- Allegedly infringing items or articles can be impounded while the action is pending and may be ordered destroyed or subject to other disposition if there is an infringement.
- An infringer can be liable for actual damages plus additional profits of the infringer or statutory damages.
- Further, an infringer could be held liable for injury to business reputation or the dilution in the value of the copyright, patent, or trademark.
Arguments that may be made to defend a claim of copyright infringement include:
- defendant did not copy your work, but independently created it.
- defendant was only making “fair use” of the material, discussed earlier;
- owner delayed bringing the action for too long a period (so that it is barred by “laches” and/or the applicable statute of limitations);
- owner or someone else (with proper authority) had authorized the use; and
- defendant He did not know the work was copyrighted.” This defense does not play well in most circumstances, as even an innocent infringer may have liability.
Software License Agreements
A software license agreement offers a contractual remedy against the user for failing to comply with any provision in the agreement. This is in addition to any other legal remedies that may be available, such as those under copyright law. A license agreement should set forth the parameters and restrictions on use of the software. They are also important to limit the software owners’ liability for use of the software which can significantly lower the site’s risk of doing business. These agreements can also waive legal warranties which are implied into the sale of software including warranties of non-infringement.
A “Work for Hire”?
If a work is a “work made for hire,” this means that a person was hired specifically to create the copyrighted work. The employer of the creator of the work can register the copyright and is entitled to protection. There are now only 9 categories of works eligible for “work made for hire” status. While these 9 categories are fairly broad and probably encompass most of what firms buy and sell, there may be significant gaps.
A “work made for hire” is one specially ordered or commissioned for use as:
- a contribution to a collective work;
- part of a motion picture or other audiovisual work;
- a translation;
- a supplementary work;
- a compilation;
- an instructional test;
- a test;
- answer material for a test, or
- an atlas
Obtaining and Protecting a Copyright
Copyright protection now arises on creation of a work, without formal action on the author’s part. However, it is wise to always place a copyright notice – typically a “c” inside a circle (©), with a year next to it and the name of the copyright holder on every publication of the work. You can obtain a formal copyright, that provides certain rights, by filing an application with the Federal Copyright Office of the Library of Congress. You do not need to apply or register to have a copyright; you receive copyright protection when you create the work. The instant you use your pencil, typewriter or computer to produce something original it is subject to copyright protection provided it is a copyrightable subject matter. However, registering your work with the Copyright Office expands your protections and sometimes can be done without disclosing the entire work. Depositing a copy of your work with the U. S. Copyright Office within 90 days of creation also protects your work by providing a legal record of the creation date and allowing others to have notice of your ownership rights.
Registration with the Copyright Office includes the filing of a copyright claim application, payment of the $30 registration fee, and deposit of at least 2 copies of the work. Accelerated registrations are available for a fee that is substantially higher than that charged for routine registrations. There are several different forms available and you must use the form corresponding to the type of work for which protection is being sought:
- Form TX for published or unpublished non-dramatic literary works;
- Form VA for visual arts;
- Form SE for periodicals and serial works;
- Form SR for published or unpublished sound recordings; and
- Form PA for published or unpublished works of the performing arts;
Copyright protection exists for original works of authorship that involve some minimal level of creativity. The work must be fixed in a tangible medium of expression so that it can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine/device. Works of authorship include: (1) literary works; (2) musical works; (3) dramatic works;(4) pantomimes and choreographic works; (5) pictorial, graphic, and sculptural works; (6) motion pictures and other audio-visual works; and (7) sound recordings. Ideas, concepts, principles, or methods of operation are not subject to a copyright, but the original work that is authored or created from such ideas or concepts may become subject to a copyright.
Copyright protection is available only for “original” works that are “fixed” in a “tangible medium of expression”. Copyright protection is not limited to works of artistic merit or those that receive critical acclaim; you can obtain the benefits of copyright protection for an “original” work regardless of its quality. However, in order to qualify for copyright protection, the work must have involved some minimal level of creativity.
The courts have not precisely defined how much creativity is “enough” of a creative spark to warrant copyright protection. Generally, courts have held that blank forms and alphabetical lists do not possess sufficient originality to constitute copyrightable works. Courts have also held that lists which are arranged, selected or organized in an original manner may be subject to copyright protection.
All that it takes for a work to be regarded as “fixed” is that it must be able to be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device.
As to the need for a “tangible medium of expression”, almost any form of expression will qualify, including jottings on a napkin, an E-mail message, and a self-recorded dictating tape. However, a speech that you deliver from memory or song that you blurt out would not be a tangible medium of expression, unless recorded.
Works “in the Public Domain” refers to created material which either by law does not get copyright protection or their protection under the law has lapsed. By definition, materials in the public domain do not have copyright protections and thus you do not need the owner’s permission to use these materials.
Contrary to the wording, however, whether materials are public has no relationship to whether they fall into the Public Domain. This mistaken notion has somehow led many to believe that everything on the Internet is public and therefore in the Public Domain and thus freely usable without permission. This is completely false.
The following works do not qualify for copyright protection:
(1) Works that have not been fixed in a tangible form of expression (for example, choreographic works that have not been notated or recorded, or improvisational speeches or performances that have not been written or recorded);
(2) Works without enough “originality” (creatively) to merit copyright protection: titles, names, short phrases, and slogans; familiar symbols or designs; font design; ingredients or contents; facts; blank forms, etc. As there is great tension here between granting incentive and financial reward when something is worthy, but not granting it to things so basic and commonly used that everyone would be forced to pay, the law is somewhat unclear in this area.
A copyright is the exclusive right given by federal statute to the creator of a literary or an artistic work to use, reproduce, and display the work. The creator of the work has a limited monopoly on the work and can, with some exceptions, prohibit others from copying or displaying the work. Copyright law protects such works as writing, music, artwork, and computer programs.
A trade secret can be any information that derives independent economic value from not being generally known or readily ascertainable. Among the things that can be trade secrets are a formula, pattern, compilation, program, device, method, technique, or process. Among things courts have found to be “trade secrets” are machining processes, blueprints, and stock-picking formulae, customer lists, pricing information, and non-public financial data. On the other hand, information such as overhead rates and profit margins that help define a price may be found to be a trade secret even if the price itself is known.
There is no process for application or registration of trade secret or know-how. In fact, publication of a trade secret to any third party could destroy its confidential nature.
Factors that determine whether something is a “trade secret”:
- the extent to which the information is known outside the business;
- the extent to which it is known to those inside the business, i.e., by the employees;
- the precautions taken by the holder of the trade secret to guard the secrecy of the information;
- the savings effected and the value to the holder in having the information as against competitors;
- the amount of effort or money expended in obtaining and developing the information; and
- the amount of time and expense it would take for others to acquire and duplicate the information.
Trade secret protection stems from the common law and dates back to the 1800′s. Today, every state recognizes some form of trade secret protection. Most states have legislation that specifically recognizes trade secrets, though some still rely solely on common law principles. Most of the states that have trade secret laws use the Uniform Trade Secrets Act, which has helped create a more uniform body of law from state to state than if each state had its own unique law. In sharp contrast to patents, copyrights and trademarks, which are all Federal-based forms of intellectual property, trade secret protection originates and is primarily maintained through state law.
Maintaining a Trade Secret
One maintains a trade secret by keeping it secret. There are no forms to fill out or applications to register. If the possessor of the secret exercises reasonable means to keep the information a trade secret then as long as the information stays secret and has economic value, trade secret protection remains available.
Reasonable means might include the following:
- restricting access to the trade secret by preventing unauthorized entry into the facility where the trade secret is kept;
- obtaining non-disclosure agreements from key employees who came into contact with the trade secret;
- obtaining non-disclosure agreements for the trade secret from suppliers and manufacturers, including those who are sub-contractors, raw material suppliers and component manufacturers;
- obtaining a secrecy agreement from everyone that had direct or indirect contact with the trade secret;
- making pertinent documents available to suppliers for the sole purpose of bidding on or manufacturing;
- marking all materials and drawings related to the trade secret with a proprietary legend restricting their use and disclosure.
A patent is a grant of a property right by the Government to the inventor. The United States Constitution provides for Congress to provide for patents to encourage useful inventions. The patent itself provides a detailed description of the invention, and how it is used or how to make it. Thus if you obtain a patent you can not keep the matter secret, which is the province of Trade Secret Law. A patent enables the owner to exclude others from making, using or selling the invention for the life of the patent.
In the United States, a patent must be issued by the United States Patent and Trademark Office, provides a detailed description of the invention, how it is used or how to make it.
Under recent changes in the laws, in the United States patents are now granted for a term of 20 years from the date of application (14 years for design patents). Different rules apply for patents covered by applications filed before June 8, 1995. Patents may be extended only by a special act of Congress (except for certain pharmaceutical patents). After expiration of the term of the patent, the person holding the patent loses the right to exclude others from utilizing the invention, so that anyone can go ahead and make use of the invention without permission of the patent holder.
Types of invention are patentable.
Utility patents may be granted to anyone who invents or discovers any new and useful process, machine, manufacture, or compositions of matter, or any new and useful improvement thereof. Such an invention must fall within one of four main classes of inventions to be patentable:
- It may be a process (such as a method for manufacturing a product);
- It may be machine;
- It may be an article of manufacture; or
- It may be a composition of matter which relates to chemical compositions, including mixtures of ingredients and new chemical compounds.
Recently, courts have affirmed that certain computer software is patentable.
Design patents may be granted to any person who has invented a new, original and ornamental design for an article of manufacture. The appearance of the article is thus protected.
Plant patents may be granted to any person who has invented or discovered and asexually reproduced any distinct and new variety of plant, including cultivated sports, mutants, hybrids, and newly found seedlings, other than a tuber-propagated plant or a plant found in an uncultivated state.
Patents are granted only to the true inventor. (If the inventor has died, then his estate may receive the patent.) However, patents (and applications) may be assigned to another individual or to a business or other legal entity.
In order to demonstrate in an application for patent that an invention is patentable, the inventor must show the following:
- The invention must be novel.
- It must not be obvious to the hypothetical person having ordinary skills in the subject matter.
- It must also have some utility and not be frivolous in nature, and
- It is necessary to demonstrate that the invention can be made operable.
Patent, trademark and copyright laws apply to computers and related activities as well. The statutory and common law schemes for the protection and enforcement of the rights of authors, inventors and businesses – established under the respective laws for patent, trademark and copyright – all apply to computers and related activities. In fact, because computers greatly increase the value of “pure ideas”, these laws are more prominent than ever. Not more important; just that much more likely to affect us all, and much more directly.
Computer hardware — the physical components of computers — AND software — the bits of binary code used to make the computer do what it does so well– are created by inventive individuals, whose design (whether circuitry or for methods for solving problems) can become the object of a patent. Patents are meant to cover ideas, and “anything new under the sun made by man” has long been the subject of patent law; only laws of nature, natural phenomena, mathematics, or other universal truths have not been patentable. And with the approaching merger between biology and computer science sometimes referred to as “DNA computing”, offering to revolutionize agriculture and health sciences, even plants, animals, and genes can be patented. Which means that the United States Patent and Trademark Office (or its like in another national government) has granted the creator a property right to the manufacture and use of his or her new design or method, for a term of 20 years from the date the patent was applied for. Nobody else in the country can use that new design or method without license from the patent-holder, until the patent expires. In exchange, however, the patent-holder provides a detailed description of the invention and the best technique he knows of at the time he applies for realizing it. This description is made public when the patent issues, increasing our societal knowledge; and that means that everybody can start working on the next improvement right away. Patents can co-exist with copyrights and trademarks, but not with trade secrets (at least, not for that invention).
Intellectual Property Law Overview and Information
Intellectual property is a property right that can be protected under federal and state law, including copyrightable works, ideas, discoveries, and inventions. The term intellectual property relates to intangible property such as patents, trademarks, copyrights, and tradesecrets. A patent is the right to exclude others from making, using or selling the invention throughout the United States of America. It prohibits others from making, selling, or using the patented invention without the authorization of the patent owner. A patent then, is granted by the government for the term period of the patent. After the patent expires, anyone may make, use or sell the invention. The federal U.S. Patent and Trademark Office administers the standards and regulations goverinng the issuance of patents, trademarks, and copyrights.
Trademarks identify the source of goods as being from a particular manufacturer Trademarks protect a company’s reputation from being harmed by the inferior products of another manufacturer. Trademarks include words, names, symbols and logos. The intent of trademark law is to prevent consumer confusion about the origin of a product. In the United States trademarks may be protected by both Federal statute under the Lanham Act, 15 U.S.C. §§ 1051 – 1127, and states’ statutory and/or common laws.
The U.S. Copyright Act, 17 U.S.C. §§ 101 – 810, is federal legislation enacted by Congress under its Constitutional grant of authority to protect the writings of authors. Evolving technology has led to an ever expanding understanding of the word “writings”. The Copyright Act now covers architectural design, software, the graphic arts, motion pictures, and sound recordings. Because federal legislation prevails over inconsistent state law, the copyright field is almost exclusively a federal one.
A copyright gives the owner the exclusive right to reproduce, distribute, perform, display, or license his work. The owner also receives the exclusive right to produce or license derivatives of his or her work. Limited exceptions to this exclusivity exist for types of “fair use”, such as book reviews. Under current law, works are covered whether or not a copyright notice is attached and whether or not the work is registered. The federal agency charged with administering the act is the Copyright Office of the Library of Congress.
Attorneys who practice in the area of intellectual property provide services such as patent registration, trademark registration, copyright registration, prosecution and licensing services. Attorneys in this practice area also typically assist clients in the protection and enforcement of trade secrets, confidentiality agreements and unfair competition concerns and other related issues.