Business Law I Chapter 41 Study Guide

What is the best definition of a trade secret?

A) A formula, device, process, method, or compilation of information that, when used in business, gives the owner advantage over competitors.

NikeShoes.com produces a running shoe that it sells in the United States. The shoe has a check mark on the side, uses inferior materials, and is made using child labor. Nike, Inc. sues NikeShoes for trademark infringement under the Federal Trademark Dilution Act of 1995. What is likely to be the grounds for this suit?

A) NikeShoes is diluting the value of Nike, Inc.'s product and tarnishing its image.

A college professor copies seven chapters from a book called "How to Get Better Grades - A Creative Approach to College Success!" There are ten chapters in the book. She incorporates this material into a packet that is printed in her college's copy center. The packet is then placed on the required materials list for students to purchase and is sold in the local book store. The author of the book believes the professor has violated his copyright.

A) The author is right. The professor should not have copied the chapters and placed them for sale in the bookstore.

Ernest invents a novel, useful, non-obvious product. He

A) must apply for a patent within one year of selling the product commercially.

What is the name of the treaty that allows American patents to be recognized and enforced in member countries?

A) the Paris Convention for the Protection of Industrial Property.

Of the following, which is an advantage of trademark registration.

B) After five years, the mark becomes almost impossible to challenge.

Which is NOT a provision of the Digital Millennium Copyright Act?

B) It is illegal to use copyrighted material under any circumstances without permission of the creator.

Jason and Stacey posted a copy of their favorite movie, Frozen, on YouTube. When YouTube realized it was posted, it removed it to avoid breaking copyright laws and was not liable for the posting. This is known as

B) a safe harbor.

If Cub Cadet wins a trademark infringement suit by proving the defendant's trademark Kub Kadet is likely to deceive customers about who made the goods, Cub Cadet is entitled to

B) an injunction to prevent further infringement.

James and his band played a very familiar song. However, they made up different words for the song that were intended to be funny. James's version of the popular song with different words is known as a

B) parody.

The Basic Books, Inc. v. Kinko's Graphic Corp. case held that

B) professors could not print and sell lengthy packets of copyrighted material under the "fair use" doctrine.

McDonald's famous golden arches and other marks used by the company illustrate a: a. suggestive mark. b. service mark. c. certification mark. d. collective mark.

B) service mark.

Richard wrote a song called "College Days." He copyrighted the composition and had it professionally printed. A couple years later, he was attending a business meeting about 1,500 miles from his home. While sitting in a nightclub, he heard a small local band perform a song called "College Memories." The music and words were extremely similar to his song. The composer of "College Memories" claims he never heard of Richard's song and that she is offended he would accuse her of stealing his work. If Richard wishes to sue for copyright infringement, he must prove

B) that his work was original and the infringer actually copied his work, or that the infringer had access to his song and that the tow works are substantially the same.

A trademark lasts for

C) 10 years, but it can be renewed for an unlimited number of terms as long as it is used.

A plant patent lasts for

C) 20 years from the date of the application.

A new savings and loan bank called Federal Deposit Bank applied for a trademark of its name. Why will this bank probably not receive trademark approval?

C) It is a deceptive mark.

Victoria registered a trademark under the Lanham Act. Six years later Don noticed Victoria's trademark and filed a lawsuit to enjoin her from using it because he had used it in his home state, even though he hadn't registered it. Will Don prevail?

C) No. Don will not prevail, and Victoria can continue to use the mark because of the time involved.

Monic, a college professor, makes 30 photocopies of a magazine and passes the article out to her students. The students are assigned to read the article and write an opinion paper about it. Has Monic violated copyright law?

C) No. Monic has acted within fair use.

Intellectual property is

C) expensive to produce but cheap to reproduce and transmit.

There are three categories of valid, distinctive marks. Which is NOT one of them?

C) generic marks.

The vast majority of patents that are issued are

C) utility patents.

Which of the following cases concerned a trade secret?

D) CDM Medai USA Inc. V Simms

A company's trade secret lasts for

D) as long as it is kept confidential

The USDA Organic Seal is an example of

D) certification mark.

In order for a copyright holder to collect money damages from a person who used copyrighted material, it must be proven that

D) the infringer actually copied the work.

A color cannot be trademarked since it cannot be kept from use by other companies.

False

A copyright is valid for 28 years after it is obtained and can be renewed for another 28 years.

False

A patent is available for an idea as well as a tangible application

False

Martina developed a new type of apple tree which could be reproduced through grafting. She cannot protect her rights in this tree by obtaining a plant patent since the tree cannot be reproduced by planting its seeds.

False

The Supreme Court has held that parody of copyrighted material is a violation of copyright law.

False

The Trademark Law Treaty made it more difficult to apply for trademarks around the world.

False

The name "Johnson Garage Doors" cannot be a trademark because a surname is already being used and other people have the right to continue to use the name.

False

Trademark dilution occurs in two important ways: blurring and garnishment.

False

A design patent protects the appearance of an item and is valid for 14 years.

True

A trade secret is a formula, device, process, method, or compilation of information that, when used in business, gives the owner an advantage over competitors who do not know it.

True

Clarissa trademarked her new company Samjack after her two sons Sam and Jack. This would be considered a fanciful trademark.

True

If a trademarked name acquires a generic meaning, the owner of the trademark loses protection.

True

Only civil penalties can be incurred under the Uniform Trade Secrets Act.

True

Southern Bar-B-Q owns a special, secret recipe for sauce which it guards because it gives the restaurant a competitive advantage. If Mort willfully misappropriates the recipe, a court may hold him liable to Southern for double damages.

True

Unlike with patents, the ideas underlying copyrighted material need not be novel.

True