Chapter 8 Intellectual Property Rights

The Berne Convention of 1886

A book copyrighted in one country that is a signatory to the Berne Convention is given copyright protection in all other countries that signed the convention. - Copyright notice not needed to gain protection. - Musicians and record labels have been declining revenues because of a drop in the sales of CDs and an increase in illegal downloads. * So, in 2011, the European Union extended royalty protection for musicians to 70 years from 50 years.

Trademark

A distinctive mark, motto, device, or implement that a manufacturer stamps, prints, or otherwise affixes to the goods it produces so that they can be identified on the market and their origins made known. - A source indicator - In common law, the person who used a symbol or mark to identify a business or product was protected in the use of that trademark. - Allowing another company to use another's trademark could cause confusion among the public. The value of the world's intellectual property exceeds the value of physical property such as machines and factories. For a company, ownership rights in intangible intellectual property are more important to their prosperity than their intangible assets. - Protection of these assets is critical. Article I, Section 8 of the Constitution

Similar Mark May Constitute Trademark Dilution

A famous mark may be diluted not only by the use of an identical mark but also by 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: 1. Related goods 2. Compete against each other 3. In the same market

What is Patentable?

Almost anything that is: 1. New and useful 2. Process, machine, manufacture, or composition of matter 3. Any new and useful improvement Thereof, almost anything is patentable, except: - The laws of nature - Natural phenomena - Abstract ideas including algorithms

Intellectual Property

Any property that results from intellectual, creative processes--the products of an individual's mind.

Compilation of Facts

Are copyrightable if they meet the test of originality. - The white pages of a telephone directory ordinarily do not meet the test. * Since it is strictly alphabetical, no originality. - The Yellow Pages can qualify for copyright protection. * Is the information selected, coordinated, or arranged in an original way?

Copyright Protection for Software

Computer Software Copyright Act of 1980 amended the Copyright Act of 1976 to include computer programs in the list of creative works protected by federal copyright law. Generally, the look-and-feel aspects (the general appearance, command structure, etc.) of computer programs are not copyrightable, because it is a method of operation.

Trade Secrets in Cyberspace

Computer technology makes it difficult for organizations to protect confidential information including trade secrets. - Disgruntled employee may email the information to a competitor, or save it to a flash drive

Counterfeit Goods

Copy or otherwise imitate trademarked goods but are not genuine. May poses serious public health risks. - Pharmaceutical and nutritional goods * Foreign counterfeiters may not be prosecuted because our laws do not apply to them. * The government may seek a court order to shut down the domain names of Web sites that sell such goods

Secondary Meaning

Descriptive terms, geographic terms, and personal names - Are not inherently distinctive * Are not protected under the law until they acquire a secondary meaning Requires the trademark owner to show that: 1. The public recognizes its trademark 2. Associates it with a single source Examples: - London Fog - Windows Usually depends on how extensively the product is: 1. Advertised 2. The market for the product 3. Number of sales Once a secondary meaning attaches to a term or name, a trademark is considered distinctive and is protected. A shade of color may qualify for protection once customers associate the color with the product. - Home depot, orange - John Deere, green - UPS, brown FedEx v. JetEx - JetEx used the same color combination, a similar name and logo - FedEx: The World on Time - JetEx: Keeping the World on Time

Service Mark

Essentially a trademark that is used a distinguish the services (rather than the products) of one person/company from those of another. - United's "Fly the Friendly Skies" is a service mark. Title and character names used in radio and television are frequently registered as service marks.

Penalties for Counterfeiting

Fines up to $2 million. Prison up to 10 years of more (for repeat offenders) Forfeiture of the counterfeit goods as well as any property used in the commission of the crime, followed by its destruction. Restitution up to the amount of the victim's loss

Patent Infringement Lawsuits and High-Tech Companies

High tech companies may lose significant profits if someone "makes, uses, or sells" something that incorporates their patented invention. - Apple v. Samsung * A jury found willful infringement * An appellate court found that certain design elements were functional and thus, not protected under the Lanham Act.

Registration of a trademark is not necessary in order to sue for infringement:

However, registration furnishes proof of the date of inception of the trademark's use

Remedies for Patent Infringement

If a patent is infringed, the patent holder may sue for relief in federal court. Royalties, lost profits, attorney's fees and, if the infringement is willful, treble damages. - Injunctions are now available only if the patent holder proves: 1. It has suffered irreparable injury 2. It serves the public interest - If damages will adequately compensate the plaintiff an injunction may not be available.

The Madrid Protocol

In the past, protecting U.S. trademarks internationally was difficult because of the time and expense required to apply for trademark registration in foreign countries. A U.S. company wishing to register its trademark abroad can submit a single application and designate other member countries in which the company would like to register its mark. - Reduces the cost of international trademark protection by more than 60% * Questions remain about member enforcement of the law and protection for a mark.

Trademark Registration

May be registered with state or federal government if: 1. It is currently in commerce 2. If the applicant intends to put it into commerce within six months. - In special circumstances, the six-month period can be extended by thirty months, for a total of three years from the date of notice of trademark approval to make use of the mark and file the required use statement. - Registration is postponed until the mark is actually used. - Registration is renewal between the fifth and sixth years after the initial registration and every ten years thereafter (every twenty years for those trademarks registered before 1990)

The TRIPS Agreement

More significant and extensive in scope than all other agreements. Establishes Standards and Procedures - For the first time, established standards for the international protection of intellectual property rights, including patents, trademarks, and copyrights for movies, computer programs, books, and music. - Each member country of the World Trade Organization must include in its domestic laws broad intellectual property rights and effective remedies (including civil and criminal penalties) for violations of those rights. Prohibits Discrimination - No discrimination against foreign intellectual property owners

Plaintiff must show that the defendant's use of the mark created a likelihood of confusion:

Plaintiff need not show that the infringer acted intentionally

Trade Dress

Refers to the image and overall appearance of a product. Ex) Distinctive decor, menu, layout, and style of service of a restaurant, the fish shape of a cracker, G-shaped design of a Gucci watch, lighthouse as part of the design of a golf hole etc. - Receives same protection as trademarks - The test: Are consumers likely to be confused by the allegedly infringing use?

Trademark Infringement

Registration with the U.S. Patent and Trademark Office (USPTO) gives notice on a nationwide basis that the trademark belongs exclusively to the registrant. - Registrant is allowed to use the symbol ® to indicate that the mark has been registered.

The First Sale Doctrine

Section 109(a) of the Copyright Act 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. - A person who buys a copyrighted book can sell it to someone else. * Applies also to promotional CDs and used textbooks

Section 102 Exclusions

Specifically excludes copyright protection or any "idea, procedure, process, system, method of operation, concept, principle, or discovery, regardless of the form in which it is described, explained, illustrated or embodied." An idea CANNOT be copyrighted. - The underlying ideas embodied in a copyright work are freely useable by others. - Whenever an idea and an expression are inseparable, the expression cannot be copyrighted. Facts widely known are NOT copyrightable. - The way in which it is expressed may be protected. Generally, anything that is not an original expression will not qualify for copyright protection, i.e., facts that are widely known, and mathematical calculations.

What is Fair use?

The 4th factor is usually the most important. HathiTrust Digital Library - Digital copies for the purpose of online research in fair use. * Allows researchers to search for terms of interest, but not read the volumes online

Copyright Infringement

The reproduction does not have to be exactly the same as the original, nor does it have to reproduce the original in its entirety. - If a substantial part of the original is reproduced, the copyright has been infringed.

Remedies for Copyright Infringement

Those who infringed copyrights may be liable for damages or criminal penalties. Actual damages (based on the harm caused to the copyright holder) or statutory damages not to exceed $150,000 and criminal proceedings resulting in fines and/or imprisonment. Ex) Online term paper business. - Authors whose work was posted on this website without their permission sued and won. * Permanent injunction

Distinctiveness of the Mark

Trademark must be: 1. Sufficiently distinctive 2. To enable consumers 3. To identify the manufacturer of the goods easily 4. To distinguish between those goods and competing products

Searchable Patent Databases

USPTO (uspto.gov) European Patent Office (epo.org)

Usual remedy is injunction:

Under the Lanham Act, a trademark owner that successfully proves infringement can recover actual damages, plus the profits that the infringer wrongfully received from the unauthorized use of the mark. A court may also order destruction of the infringing goods.

Certification Mark

Used by one or more persons, other than the owner, to certify the region, materials, mode of manufacture, quality, or other characteristic of specific goods/services. - "Good Housekeeping Seal of Approval" - "UL Tested"

Collective Mark

When used by members of a cooperative, association, or other organization. Ex) End of motion picture credits to indicate the various associations and organizations that participated in the making of the films.

Registration

Works can be registered with the U.S. Copyright Office. Owner needs not place the symbol ©, Copr. or Copyright on the work to have it protected against infringement. Copyright includes protection from: 1. Reproduction of the work 2. Development of derivative work 3. Distribution of the work 4. Public display of the work

Trademark is infringed whenever a trademark is:

1. Copied to a substantial degree 2. Used in an entirety by another, intentionally or not

Licensing

Allows use of another's trademark, copyright, patent or trade secret, for a certain purpose, while avoiding litigation. - The party that owns the intellectual property rights and issues the license is the LICENSOR, and the party obtaining the license is the LICENSEE. - Licensee generally pays fees, or royalties, for the privilege of using the intellectual property. License: An agreement, or contract, permitting the use of a trademark, copyright, patent, or trade secret for certain purposes.

Combating Foreign Counterfeiters

Court order to shut down the domain names of Web sites that sell such goods.

What is Protected Expression?

Books, records, films, artworks, architectural plans, menus, music videos, product packaging, and computer software. To be protected, a work must be "fixed in a durable medium" from which it can be perceived, reproduced, or communicated. - Protection is automatic, and registration is not required. A work must be original and fall into one of the following categories: 1. Literary works (including newspaper and magazine articles, computer and training manuals, catalogues, brochures, and print advertisements) 2. Musical works and accompanying words (including advertising jingles) 3. Dramatic works and accompanying music. 4. Pantomimes and choreographic works (including ballets and other forms of dance) 5. Pictorial, graphic, and sculptural works (including cartoons, maps, posters, statues, and even stuffed animals) 6. Motion pictures and other audiovisual works (including multimedia work) 7. Sound recordings. 8 Architectural works

Copyrights

Copyright is an intangible property right granted by federal statute to the author or originator of a literary or artistic production of a specified type. The Copyright Act of 1976 as amended, governs copyrights. - Works created after January 1, 1978 are automatically given statutory copyright protection for: 1. The life of the author plus 70 years. 2. For copyrights owned by publishing houses, the copyright expires 95 years from the date of publications or 120 years from the date of creation, whichever comes first. 3. For works by more than one author, the copyright expires 70 years after the death of the death of the last surviving author. - These time periods reflect extensions contained in the Copyright Term Extension Act of 1998. * The extension prevents copyrighted works from the 1920s and 1930s from losing protection and entering the public domain for an additional twenty years. * When copyright protection ends, works enter the public domain. - Sherlock Holmes by Arthur Conan Doyle * Published between 1887 and 1927 * Elements published before 1923 have entered the public domain

Starbucks v. Sambuck's Coffeehouse

Created confusion for consumers; there was a high degree of similarity between the marks and both companies provide coffee-related services and marketed their services through stand-alone retail stores. - The use of a similar mark

The "Fair Use" Exception

Fair use allows someone to reproduce copyrighted material without payment of a royalty. Section 107 of the Copyright Act The court looks for four factors: 1. Purpose and character of the use; is it commercial or educational? 2. The nature of the copyrighted work 3. The amount of substantiality 4. The effect of the use on the potential market or value of the copyrighted work

Strong Marks

Fanciful, arbitrary, or suggestive trademarks are considered the most distinctive (strong) trademarks without demonstrating secondary meaning. Receive automatic protection because they serve to identify a particular product's source, as opposed to describing the product itself. 1. Fanciful - Invented words: i.e. Xerox, Kodak, Google, IKEA 2. Arbitrary - Common words used in an uncommon way that is not descriptive of the product: * Dutch Boy: As a name for paint. * A stylized "X" has led to litigation between ESPN (X games) and Quiksilver's clothing 3. Suggestive - Indicates something about a product's nature, quality, or characteristics, without describing the product directly - Dairy Queen: Suggests an association between its products and milk, but it does not directly describe ice cream. - Blu-ray associated with the high-quality, high-definition video contained on a particular type of optical data storage disc. Although blue-violet lasers are used to read blu-ray discs, the term blu-ray does not directly describe the disc.

Patent Infringement and Foreign Sales

Foreign companies can obtain U.S. patent protection on items sold within the U.S. American companies can obtain patent protection in foreign countries where their goods are sold. - Limitations on Exported Software * Generally, under U.S. law, no patent infringement occurs when a patented product is made and sold in another country

Generic terms

If they refer to an entire class of products, such as bicycle and computer, receive no protection even if they acquire a secondary meaning. Occasionally, a trademark becomes generic: - Aspirin - Thermos - Escalator - Trampoline - Raisin Bran - Dry ice - Lanolin - Linoleum - Nylon - Corn Flakes A trademark may not become generic simply because it is commonly used: - Two individuals sued in federal court to have Google canceled as a trademark. * They argued that because most people used Google as a verb ("to google") it lost its protection. * The court disagreed * "...the primary significance of the word google to a majority of the public...is a designation of the Google search engine" * It is still a protected trademark if consumers associate the noun with our company.

The Anti-Counterfeiting Trade Agreement

In 2011, Australia, Canada, Japan, Korea, Morocco, New Zealand, Singapore, and the U.S. signed the Anti-Counterfeiting Trade Agreement (ACTA) - To combat global counterfeiting and piracy. Goals and Provisions - Increase international cooperation - Facilitate best law enforcement practices - Provide a legal framework to combat counterfeiting - Applies to: 1. Physical goods such as medications 2. Pirated copyrighted works distributed by the Internet Border Searches - Member nations allowed to search commercial shipments of imports and exports for counterfeit goods. - Does not require, nor prohibit, random searches of electronic devices, such as laptops, tablets, and smart phones for infringing content. - A reasonable belief allows seizure of suspected goods until the owner demonstrates the items are authentic and non-infringing. - Online service providers may be compelled to provide information, including the identity, of suspected trademark and copyright infringers.

Trade Names

Indicates part or all of a business's name. - Directly related to a business and its goodwill. - Trademarks apply to PRODUCTS. -May be protected as a trademark if the trade name is also the name of the company's trademarked product. - Ex) Coca-Cola Trade name cannot be registered with the federal government unless also used as a trademark or service mark. May be protected under the common law but only if they are unusual or fanciful (i.e. Safeway)

Statutory Protection of Trademarks

Lanham Act of 1946 - Enacted to protect manufacturers from losing business to rival companies that used confusingly similar trademarks.

The Stop Counterfeiting in Manufactured Goods Act

Makes it a crime to: - Intentionally traffic in or attempt to traffic in counterfeit goods/services. - Or to knowingly use a counterfeit mark on or in connection with goods/services. Previously, it was not illegal to create or ship counterfeit labels that were not attached to a product.

Patent Infringement

Making, using, selling another's patent design, product, or process without permission. May occur even though the patent owner has not put the patented product into commerce. - Infringement does not require that the patent owner put the patented product "into commerce" Does not require that all features or parts of an invention be copied (except for a patented process) provided that the features are equivalent to those used in the patented invention

Patents

Patent is a grant from the government that gives an inventor the exclusive right to make, use, or sell his/her invention for a period of 20 years. - 14 years for a design The invention, discovery, process or design must be: 1. Novel 2. Useful 3. Not obvious in light of current technology Notice is the word Patent or Pat. and the patent number Until recently, the U.S. gave protection to the first to invent. - Many other countries give protection to the first person to file a patent application. - It may be difficult to prove who was the first to invent. America Invents Act of 2011 * First to file an application for a patent * Nine month statute of limitations to challenge a patent * Patent protection begins on the date the application is filed, not when the patent is issued, which may be years later. * When the patent period ends, the product or process enters the public domain and anyone may make, sell, or use the invention without paying royalties to the patent holder

Central Objective of the Lanham Act

Reduce the likelihood that consumers will be confused by similar marks. - Only those trademarks sufficiently distinctive from all competing trademarks will be protected.

State and Federal Law on Trade Secrets

Section 757 of the Restatement of Torts One who discloses or uses another's trade secrets, without a privilege to do so, has committed a tort if: 1. They discovered the secret by improper means 2. Their disclosure or use constitutes a breach of duty owed to the other party Industrial espionage, such as tapping into a competitor's computer, does not involve a contractual violation but may violate criminal law. Until recently, virtually all law was common law. - To address the unpredictability of the common law the Uniform Trade Secrets Act was prepared. * Not all states have adopted this law. - In addition, the theft of trade secrets is a federal crime under the Economic Espionage Act

Trade Secrets

Some business processes and information that are not, or cannot be, patented, copyrighted, or trademarked, are nevertheless protected against appropriation by competitors as trade secrets. Trade secret is basically information of commercial value, such as customer lists, plans, and R&D pricing information, marketing techniques, etc., that make an individual company unique and would have value to a competitor. Unlike copyright and trademark protection, protection of trade secrets extends both to ideas and their expression. - Confidentiality ("nondisclosure") agreement

Trademark Dilution (aka "blurring")

The Federal Trademark Dilution Act (1995) amended the Lanham Act. - Previously, federal law prohibited the unauthorized use of the same mark on competing - or noncompeting but "related" goods - goods/services only when such use would likely confuse consumers. -Now, federal law protects "distinctive" or "famous" trademarks (i.e. Rolls Royce, Mcdonald's, Apple) regardless of a showing of competition or likelihood of confusion. - Under the Trademark Dilution Revision Act (TDRA), to state claim for trademark dilution, a plaintiff must prove: 1. The plaintiff owns a famous mark that is distinctive. 2. The defendant has begun using a mark in commerce that allegedly is diluting the famous mark. 3. The similarity between the defendant's mark and the famous mark gives rise to an association between the marks. 4. The association is likely to impair the distinctiveness of the famous mark or harm its reputation.

International Protection for Intellectual Property

The Paris Convention of 1883 - Allowed a party in one country to file for patent and trademark protection in any of the other signatory countries.