Chapter 8 - Intellectual Property Rights

Intellectual Property

Any property resulting from intellectual, creative processes, the product of one or more individual’s minds.

Article I § 8

authorizes Congress to “secur[e] for limited times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”

Trademark

A distinctive mark, motto, device, or implement that a manufacturer stamps, prints, or otherwise affixes to the goods it produces so that they may be identified on the market and their origins made known

Once a trademark is established (under the common law or through registration)

the owner is entitled to its exclusive use.

Lanham Act of 1946

incorporates the common law of trademarks and provides remedies for owners of trademarks who wish to enforce their claims in federal court.

Dilution

A doctrine under which distinctive or famous trademarks are protected from certain unauthorized uses regardless of a showing of competition or a likelihood of confusion.

Trademark Dilution Revision Act (TDRA)

• The plaintiff owns a famous mark that is distinctive.

• The defendant has begun using a mark in commerce that allegedly is diluting the famous mark.

• The similarity between the defendant’s mark and the famous mark gives rise to an association between the marks.

• The association is likely to impair the distinctiveness of the famous mark or harm its reputation.

Marks Need Not Be Identical

• A famous mark may be diluted by the use of an identical mark Or

• by the use of a similar mark

  • A similar mark is more likely to lessen the value of a famous mark when the companies using the marks provide related goods or compete against each other in the same market.

Trademarks may be registered with

the state or with the federal government.

Trademark Registration

• File an application with the U.S. Patent and Trademark Office in Washington, D.C.

• Registration gives notice on a nationwide basis that the trademark belongs exclusively to the registrant.

• The symbol ® indicates that a mark has been registered.

Under current law, a mark can be registered:

• If it is currently in commerce

• If the applicant intends to put it into commerce within six months

  • Registration is renewable

Trademark Infringement

a trademark is copied to a substantial degree or used in its entirety by another, intentionally or unintentionally; without permission

• The owner of the mark has a cause of action against the infringer.

• The owner must show that the defendant’s use of the mark created a likelihood of confusion about the origin of the defendant’s goods or services.

• The most commonly granted remedy is an injunction to prevent further infringement.

A trademark owner that successfully proves infringement can recover:

• Actual damages

• The profits that the infringer wrongfully received from the unauthorized use of the mark

• Attorneys’ fees

Distinctiveness of the Mark

A trademark must be sufficiently distinctive to enable consumers to identify the manufacturer of the goods easily and to distinguish between those goods and competing goods.

Fanciful trademarks

use invented words.

• Google

• Xerox

Arbitrary trademarks

use common words in an uncommon way that is not descriptive of the product.

• “Dutch Boy” for Paint

Suggestive trademarks

indicate something about a product’s nature, quality, or characteristics, without describing the product directly.

• Blue-ray DVD

Secondary Meaning

Descriptive terms, geographic terms, and personal names are not inherently distinctive and do not receive protection under the law until they acquire a...

• Example “London Fog” coats.

A secondary meaning may arise when customers

begin to associate a specific term or phrase with specific trademarked items made by a particular company.

Whether a secondary meaning becomes attached to a name usually depends on:

How extensively the product is advertised

• The market for the product

• The number of sales

Generic Terms

Generic terms that refer to an entire class of products receive no protection, even if they acquire secondary meaning.

• Bicycle

• Aspirin

• Computer

Service mark

A mark used in the sale or the advertising of services, such as to distinguish the services of one person from the services of others.

• Titles, character names, and other distinctive features of radio and television programs may be registered

Certification mark

A mark used by one or more persons, other than the owner, to certify the region, materials, mode of manufacture, quality, or accuracy of the owner’s goods or services.

• “UL Tested” = Underwriters Labs Tested the Product.

Collective mark

A mark used by members of a cooperative, association, or other organization to certify the region, materials, mode of manufacture, quality, or accuracy of the specific goods or services.

Trade dress

The image and overall appearance of a product. Is subject to the same protection as trademarks.

Counterfeit Goods

They are not the genuine trademarked goods.

• They have negative financial effects on legitimate businesses.

• They can present serious public health risks.

The Stop Counterfeiting in Manufactured Goods Act

makes it a crime to:

• Traffic, or attempt to traffic, intentionally in counterfeit goods or services

• Knowingly use a counterfeit mark on or in connection with goods or services

Penalties for Counterfeiting

• May be fined up to $2 million or imprisoned for up to ten years

• Must forfeit the counterfeit products

• Must forfeit any property used in the commission of the crime

• Must pay restitution to the trademark holder or victim in an amount equal to the victim’s actual loss

Trade name

A term that is used to indicate part or all of a business’s name and that is directly related to the business’s reputation and goodwill.

• Trade names may be protected under trademark law if the name is the same as the firm’s trademark.

• Unless it is also used as a trademark or service mark, a trade name cannot be registered with the federal government.

• Trade names are protected under the common law, but only if they are unusual or fancifully used.

License

A contract permitting the use of a trademark, copyright, patent, or trade secret for certain purposes.

• grants only the rights expressly described in the license agreement.

Licensor

party that owns the intellectual property rights and issues the license.

Licensee

The party obtaining the license.

Royalties

The licensee generally pays fees, for the privilege of using the intellectual property.

Patent

A government grant that gives an inventor the exclusive right or privilege to make, use, or sell their invention for a limited time period.

Utility patents

may be granted to anyone who invents or discovers any new and useful process, machine, article of manufacture, or composition of matter, or any new and useful improvement thereof;

Design patents

may be granted to anyone who invents a new, original, and ornamental design for an article of manufacture; and

Plant patents

may be granted to anyone who invents or discovers and asexually reproduces any distinct and new variety of plant

• Utility Patent 20 Years

• Design Patent 15 (prior to May 12, 2015 14 years)

• Plant Patent 20 year

Patentable: The product, process, or design must be

• Novel

• Useful, and

• Not obvious in light of current technology.

Almost anything is patentable, except:

• The laws of nature

• Natural phenomena

• Abstract ideas (including algorithms)

American Invents Act of 2011

• The first person to file an application for a patent on a product or process will receive patent protection.

• The period of patent protection begins on the date the patent application is filed, rather than when the patent is issued.

• After the patent period ends, the product or process enters the public domain, and anyone can make, sell, or use the invention without paying the patent holder.

Patent Infringement

use, or selling another’s patented design, product, or process without the patent owner’s permission.

Patent infringement may occur even though:

• The patent owner has not put the patented product into commerce.

• Not all features or parts of a product are copied.

Remedies for Patent Infringement

If a patent is infringed, the patent holder may sue for relief in federal court.

• Seek an injunction against the infringer

• Request damages for royalties and lost profits

  • If the court determines that the infringement was willful, the court can triple the amount of damages awarded (treble damages).

• Seek reimbursement for attorneys’ fees and costs

Copyright

The exclusive right of authors to publish, print, or sell an intellectual production for a statutory period of time.

The Copyright Act of 1976

• Works created after January 1, 1978, are automatically given statutory copyright protection for the life of the author plus 70 years.

• For copyrights owned by publishing houses, the copyright expires 95 years from the date of publication or 120 years from the date of creation, whichever comes first.

• For works by more than one author, the copyright expires 70 years after the death of the last surviving author.

• When copyright protection ends, works enter into the public domain.

Copyrights can be registered with the U.S. Copyright Office in Washington, D.C.; however,

registration is not required.

What does a copyright owner no longer need to place to have their work protected against infringement?

to place the symbol © or the term Copr. or Copyright 

Generally, copyright owners are protected against the following:

• Reproduction of the work

• Development of derivative works

• Distribution of the work

• Public display of the work

To be protected, a work must be

“fixed in a durable medium” from which it can be perceived, reproduced, or communicated.

Section 102 of the Copyright Act explicitly states that it protects the following original works:

• Literary works (including newspaper and magazine articles, computer and training manuals, catalogues, brochures, and print advertisements)

• Musical works and accompanying words (including advertising jingles)

• Dramatic works and accompanying music

• Pantomimes and choreographic works (including ballets and other forms of dance)

• Pictorial, graphical, and sculptural works (including cartoons, maps, posters, statues, and even stuffed animals)

• Motion pictures and other audiovisual works (including multimedia works)

• Sound recordings

• Architectural works

Section 102 Exclusions

• Anything that is not an original expression will not qualify for copyright protection.

  • Facts widely known to the public are not copyrightable.

  • It is not possible to copyright an idea.

    • However, the particular way in which an idea is expressed is copyrightable.

    • Thus, an idea and its expression must be separable to be copyrightable.

Compilations of Facts

Compilations of facts are copyrightable.

Compilation

“a work formed by the collection and assembling of preexisting materials or data that are selected, coordinated, or arranged in such a way that the resulting work as a whole constitutes an original work of authorship.

Copyright Infringement

Whenever the form or expression of an idea is copied

• The reproduction does not have to be exactly the same as the original, nor does it have to reproduce the original in its entirety.

Remedies for Copyright Infringement

• Actual damages are based on the harm caused to the copyright holder by the infringement.

  • Statutory damages, not to exceed $150,000, are provided for under the Copyright Act.

• Criminal proceedings may result in fines and / or imprisonment. − A court can also issue a permanent injunction against a defendant when the court deems it necessary to prevent future copyright infringement.

• A court can also issue a permanent injunction against a defendant when the court deems it necessary to prevent future copyright infringement.

The “Fair Use” Exception

• Criticism and comment

• News reporting

• Teaching

• Scholarship

• Research

The courts determine on a case-by-case basis

Factors to be considered include:

• Purpose and character of the use

• Nature of the copyrighted work

• Amount and substantiality of the portion used in relation to the copyrighted work as a whole

• Effect of the use upon the potential market for or value of the copyrighted work

The First Sale Doctrine

• The owner of a particular item that is copyrighted can, without the authority of the copyright owner, sell or otherwise dispose of it.

• Once a copyright owner sells or gives away a particular copy of a work, the copyright owner no longer has the right to control the distribution of that copy.

Copyright protection extends to:

• Those parts of a computer program that can be read by humans, such as the “high-level” language of a source code

• The binary-language object code, which is readable only by the computer

• The overall structure, sequence, and organization of a program

Typically, copyright protection is not extended to the “look and feel” of computer programs, which includes:

• The general appearance

• Command structure

• Video images

• Menus

• Windows

Trade secret

Information or a process that gives a business an advantage over competitors who do not know the information or process.

Trade secrets include, but are not limited to, the following:

• Customer lists

• Plans

• Research and development

• Pricing information

• Marketing methods

• Production techniques

Protection of trade secrets extends to both ideas and their expression.

• There are no registration or filing requirements for trade secrets.

• Use of confidentiality/non disclosure agreements

Section 757 of the Restatement of Torts those who disclose or use another’s trade secret, without authorization, are liable if either of the following is true:

• They discovered the secret by improper means.

• Their disclosure or use constitutes a breach of a duty owed to the other party

Industrial espionage

such as by tapping into a competitor’s computer, is a theft of trade secrets without any contractual violation and is actionable in itself.

Trade secrets have long been protected under the common law.

• Nearly every state has enacted trade secret laws based on the Uniform Trade Secrets Act.

• The Economic Espionage Act makes the theft of trade secrets a federal crime.

There are a number of international agreements relating to intellectual property rights, including:

• The Paris Convention

• The Berne Convention

• The Trade-Related Aspects of Intellectual Property Rights (TRIPS agreement)

• The Madrid Protocol − The Anti-Counterfeiting Trade Agreement

The Berne Convention

• If a citizen of a country that has signed the convention writes a book, all other countries that have signed the convention must recognize that author’s copyright in the book.

• If a citizen of a country that has not signed the convention first publishes a book in one of the countries that have signed, all other countries that have signed the convention must recognize that author’s copyright.

• Copyright notice is not needed to gain protection for works published after March 1, 1989

In 2011, the European Union altered its copyright rules under the Berne Convention to

extend the period of royalty protection for musicians from fifty years to seventy years

The TRIPS Agreement

established, for the first time, standards for the international protection of intellectual property rights.

• Each member country of the World Trade Organization must include intellectual property rights and effective remedies for violations in its domestic laws.

• Each member nation must also ensure that legal procedures are available for parties who wish to bring actions for infringement of intellectual property rights.

Prohibits Discrimination

TRIPS forbids member nations from giving their own citizens favorable treatment without offering the same treatment to other member countries

The Madrid Protocol

designed to reduce the time and expense of securing international trademark protection.

• A company can submit a single application and designate other member countries in which the company would like to register its mark.

The goals of the Anti-Counterfeiting Trade Agreement (ACTA) are to:

• Increase international cooperation for combating counterfeiting

• Facilitate the best law enforcement practices for combating counterfeiting

• Provide a legal framework for combating counterfeiting

• also applies to pirated copyrighted works distributed via the internet.

Border Searches

• Member nations are required to establish border measures that allow officials to search commercial shipments of imports and exports for counterfeit goods.

  • If border authorities reasonably believe goods in transit are counterfeit, the treaty allows them to keep the suspect goods until the owner proves otherwise.