Intellectual Property Basics

Intellectual Property law developed to reward an innovator with some type of limited property right in the fruits of his or her innovative endeavors. The need to provide an incentive for innovation and creativity was recognized in the U.S. Constitution, which provides:

The Congress shall have power…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. Art. 1, Sec. 8, Cl. 8.

Intellectual Property law developed to reward an innovator with some type of limited property right in the fruits of his or her innovative endeavors. The need to provide an incentive for innovation and creativity was recognized in the U.S. Constitution, which provides:

The Congress shall have power…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. Art. 1, Sec. 8, Cl. 8.

The two primary purposes of Intellectual Property law are: (1) to encourage creativity and/or investment for research and development by rewarding innovation; and (2) to protect inventors from improper competitive activities.

There are three main areas of Intellectual Property law: patents, trademarks and copyrights.

Patents

Patent protection is one of the most powerful types of Intellectual Property protection. Once a patent has been obtained, the owner is allowed to prohibit others from making, using, selling, offering for sale or importing the patented invention for the life of the patent (generally 20 years from the filing date of the patent).

In exchange for disclosing the innovation to the rest of the world, the government will give the inventor a monopoly of limited scope and duration. The advantage gained for the public by disclosure is the stimulation and promotion of further research and development and free access to the invention at the end of the patent monopoly. A patent is available for “any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof.”

It is possible to patent a wide range of items including computer software, genetically engineered animals, oil-eating microbes, methods for performing certain tasks, and the more traditional patentable subject matter, such as mechanical devices.

To be patentable, the invention must be new. The “novelty” requirement means that the invention must not be identical to a prior invention and must not be obvious to one of “ordinary skill in the art” in light of the prior art. These requirements require diligence on the part of potential owners of Intellectual Property, since an invention which was first offered for sale, publicly used or described in a printed publication more than one year prior to the filing date of a patent application is not patentable.

The patent application consists of two primary parts: the specification and the claims. The specification includes a written description of the invention and any drawings necessary for understanding the invention. It must contain enough detail so that a person of “ordinary skill in the art” could reproduce the invention without undue experimentation, and it must disclose the “best mode” of making the invention known to the inventor at the time the application is filed.

The claims define the legal boundaries of the patent protection conferred upon the inventor by the patent. The claims are the heart of the patent. Once a patent issues, the claims will be used to determine if other products fall within the definitions set out by the claims and therefore infringe the patent.

There are several different types of patents which provide protection to inventions. The most common type is the utility patent. The other types include design patents, plant patents and method patents. An inventor who wishes to obtain a patent would first have his or her attorney conduct a “patentability” search to determine if a patent is available for the invention and how broad the protection will likely be.

The attorney would then proceed to prepare and file a patent application with the U.S. Patent and Trademark Office (USPTO). Within about nine months to one year, an examiner with the USPTO will conduct a search for prior art relevant to the invention and issue a report referred to as an “Office Action.” The typical Office Action will object to a variety of informalities and will likely reject those claims based upon any prior art found by the examiner.

Next, the attorney will prepare a response to the Office Action which will typically include an amendment to the claims and arguments refuting the arguments and positions offered by the examiner in the Office Action. After a response to an Office Action is filed, it will take the examiner between three and six months to respond to the attorney’s arguments in another Office Action. In all, the patent prosecution will typically take between 18 and 24 months.

Once issued, a patent is currently valid for a period of 20 years measured from the filing date of the application. Patents only give their owners rights within a geographic area, and the protection offered by a patent ends at the national border of the government that granted the patent. Therefore, one must file a patent application in every country where patent protection is required. However, international treaties, including the Paris Convention and the Patent Cooperation Treaty, simplify obtaining patent protection in foreign countries. U.S. patents will prevent foreign entities from making, using, selling, offering for sale or importing any product or processes protected by a U.S. patent.

Trademarks/Service Marks

A trademark is any word, name, symbol or device used to identify the source or origin of goods or services and to distinguish the goods or services from others. Trademark protection applies to trademarks, service marks, collective membership marks and certification marks.

The overall image of a product, including its packaging, configuration, design or overall impression, can sometimes be protected as a trademark and is referred to as the “trade dress” of the goods or services. Examples of trade dress include the unique design of the Coca-Cola bottle and the pink color of Owens-Corning fiberglass. If properly protected and policed, trademarks can represent a major asset for a business. It has been estimated, for example, that the “Budweiser” trademark is worth $3 billion.

The owner of trademark rights in a mark can prevent others from using similar marks on goods or services that would be likely to confuse the public as to the source or origin of the goods or services. A number of factors are considered when determining whether there is a likelihood of confusion. These include the similarity of the marks, the similarity of the goods or services and the strength of a mark.

Trademark rights may have infinite duration so long as they are used properly. However, a trademark owner may lose his rights to a trademark if the trademark evolves into a generic name for a good or service. Examples of trademarks that have become generic include escalator, linoleum, nylon, thermos bottle and aspirin. Generic marks are not accorded protection as they have become the actual names of things. In order to prevent a trademark from becoming generic, a trademark owner should use his trademark as an adjective and use the word “brand” after the trademark.
Diligent “policing” of the mark will also prevent it from becoming generic. A trademark policing or protection program may include an in-house or outside watching service that monitors trademark applications, corporate databases and the Internet for generic or confusingly similar uses of one’s trademarks.

In the event a confusingly similar mark is located, a cease-and-desist letter should be sent by the company’s attorney to the owner of the infringing mark only after determining that the infringing mark does not have rights superior to the company’s mark.

Common law rights to a trademark are acquired through use in commerce and are generally limited to the geographic area of actual use. Trademark protection outside the United States is based upon the laws of various foreign countries. Under the territoriality doctrine, trademark rights exist in each country according to that country’s statutory scheme.

Trademarks are generally classified, from strongest to weakest, as arbitrary (also fanciful), suggestive, descriptive or generic. Examples of arbitrary marks would be Exxon for petroleum products, Xerox for copying machines, and Kodak for cameras. Suggestive marks suggest a quality or characteristic of the associated goods or services, while descriptive marks merely describe the associated goods or services.

Registration of a trademark, although not mandatory, is recommended because registration can substantially expand the common law rights of a trademark owner. A trademark may be registered federally at the USPTO if used in interstate commerce. A trademark also may be registered at the registration office in any of the 50 states where used. However, state registrations offer only limited benefits, and protection varies widely from state to state.

Federal registration of a trademark at the USPTO is strongly recommended because federal registration provides nationwide rights. Federal registration creates federal question jurisdiction for infringement suits and makes the outcome of litigation more predictable because of extensive federal case law precedent.

A certificate of federal registration is also prima facie evidence of the registrant’s ownership and exclusive right to use the mark throughout the United States, and is prima facie evidence of the registrant’s continuous use of the mark in commerce from at least as early as either the filing date of a “use” application or the filing date of an “intent to use” application. Lastly, because many court cases have held that a federal registration is presumptive evidence that the mark, even if arguably descriptive, is distinctive, federal registration may eliminate the need to prove secondary meaning in a court case. Because descriptive terms initially describe rather than identify the source of a product, they are generally not protectable until the consumer learns to associate them with a single source. That learned association is called “secondary meaning.” For example, the primary meaning of “Extra Strength Pain Reliever” is a strong analgesic. The secondary meaning of “Extra Strength Pain Reliever,” which developed second in time to the primary meaning, is the Excedrin product made by Bristol-Myers.

Federal statutes permit recovery of profits, damages and costs, as well as equitable relief in the form of injunctions and seizure orders. Even treble damages and attorney’s fees can be obtained in exceptional cases.

Although not mandatory, a trademark search is recommended prior to filing a registration application for a proposed mark to determine whether the proposed mark can be registered successfully. If large sums of money are intended to be invested in a proposed mark, it is advisable to perform an extensive search, including state and federal trademark registrations as well as common law trademarks throughout the U.S.

After the trademark application is filed, an examiner performs a trademark search to determine whether the proposed mark is confusingly similar to any marks of record.
An Office Action is prepared by the trademark examiner, who may reject the proposed trademark based upon a variety of grounds including, among others, confusing similarity with existing mark registrations, descriptiveness of the mark and/or technical objections. There is a six-month deadline to respond to an Office Action. The response may include arguments and/or amendments in an attempt to achieve allowance of the trademark application.

If the trademark application is allowed, then the trademark will be published for opposition. If an opposition is filed by an existing mark owner during the 30 days after publication, then an opposition proceeding, like a mini-litigation, is held before the Trademark Trial Appeal Board at the USPTO to adjudicate whether registration is proper. If no opposition to the published trademark is received by the USPTO within 30 days, then the trademark is registered.

Federal registration entitles the registrant to use the registration symbol “®” in connection with the trademark to give notice of the registrant’s trademark rights and deter others from infringing. Prior to registration, the symbols “™” (for trademark) and “SM” (for service mark) may be used with a mark to serve as notice that the mark owner considers the mark to be proprietary. Notice of the federal registration tends to deter junior parties from adopting confusingly similar marks that otherwise could be infringements.

Copyrights

A copyright is a property right that protects against the copying of “original works of authorship fixed in any tangible medium of expression.” These works can include literary works (including computer programs), dramatic works (including associated music), musical works (including associated verbiage), pantomimes and choreographic works, pictorial, graphic and sculptural works, motion pictures and other audiovisual works, sound recordings and architectural works.

A copyright does not protect an idea, only an author’s particular expression of that idea. Copyright law gives the copyright owner exclusive rights to reproduce, adapt, publicly distribute, publicly perform and publicly display the work. The right of adaptation refers to the right of preparing derivative works based upon the copyrighted work. A derivative work is a work that borrows substantially from a preexisting work.

Public distribution includes the sale, lease or other transfer of the work. Except for sound recordings and computer programs, a copyright owner loses this right over a copy of the work that has been gifted or sold to another.

“Fair use” is a defense to an allegation of copyright infringement. The defense of fair use can be asserted when a copy of a protected work is made “for purposes of criticism, comment, news reporting, teaching, scholarship, or research.” In determining whether a use is fair use, the court will look at the purpose and character of the use, including the purpose for which it is used (i.e., commercial or nonprofit educational purposes), the nature of the copyrighted work, the amount and substantiality of the portion used in relation to the copyrighted work as a whole, and the effect of the use upon the potential market for or value of the copyrighted work.

A work created on or after January 1, 1978, is protected by copyright law for the life of the author plus 70 years. If a joint work was prepared by two or more authors who did not work for hire, the copyright term lasts until 70 years after the death of the last surviving author. “Works made for hire” and anonymous works are protected for 95 years from publication or 120 years from creation, whichever is shorter. For works created prior to 1978, provided renewals are made, protection can extend for a term of 95 years. A “work made for hire” is a work generated by an employee within the scope of his employment, and in this case, the employer owns the copyright. Where an independent contractor is hired to generate a particular work, the work is generally not a “work for hire” and the contractor is the owner of the work.

A work is protected by copyright when it becomes “fixed in any tangible medium of expression” and has sufficient “originality.” A work is considered “fixed” when it is in a form which is “permanent or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more than transitory duration.” Examples of works fixed in a tangible medium would include sculptures, photographs and works fixed in magnetic mediums.

Examples of works that are not fixed include speeches or performances that have not been written or recorded, ideas, methods or concepts. Although registration is not generally a requirement for protection, the copyright law accords several significant advantages to those copyright owners who make the registration. These advantages include establishing a public record of the copyright claim and providing a prerequisite for bringing a suit for copyright infringement.

If registration is made within three months after publication of the work or prior to an infringement of the work, statutory damages and attorney’s fees for later infringement are available to the copyright owner. Statutory damages can range from $750 to $150,000 for each work infringed. In order to register for copyright protection, a registrant must file a registration, deposit copies of the work and file a fee with the Copyright Office at the Library of Congress, Washington, D.C. The copyright examiner will review the submission to make sure that the application was completed properly, that the Office received a nonrefundable filing fee and that the Office received a nonreturnable deposit of the work being registered.

There are three elements in a proper copyright notice: the symbol “©” and/or the word “copyright” or the abbreviation “copr.”; the year of first publication of the work; and the name of the copyright owner. For sound recordings, a circled “P” is substituted for the word “copyright” or the © symbol. The phrase “All Rights Reserved” also should be placed in a copyright notice to protect the work under certain international treaties. A search of copyright registrations is warranted when one wishes to copy an existing work, whether or not the work has a copyright notice, so as to determine whether the work has been registered for copyright protection.

There is no such thing as an international copyright. However, several multilateral treaties, most notably the Berne Convention, have extended copyright protection to U.S. authors in foreign countries.

Take Advantage Of Your Constitutional Rights

Beginning with its founding fathers, the United States has led the world in invention and innovation, both in science and the arts. This distinguished position is no doubt attributable, in a most significant way, to the long-standing protections afforded to its residents and citizens by Intellectual Property laws. Everyone who seeks to make creative and new intellectual contributions should be familiar with and properly enforce his proprietary rights through patent, trademark or copyright protection.