Written by Jesson & Rains attorney, Kelly Rains Jesson
This is the third installment out of our intellectual property series. The fourth and final article will be about protecting trade secrets and confidential information using contracts.
A patent is a federally-issued form of intellectual property protection granted to inventors of unique designs and processes. The patent prevents other individuals and companies from making or selling the invention for 14 to 20 years. An inventor must apply for a patent within one year of publicly disclosing the invention. A patent is public record information, so while the invention is protected, it is not secret.
The two main types of patents are utility patents and design patents. A utility patent is a machine, process, or component part thereof used to make a product. A design patent is the unique design of the product itself. The design patent covers only the appearance of the product and not the structural or functional features (that would be a utility patent). An example of a design patent is a glass soda bottle. A design patent lasts for fourteen years.
A utility patent is the most common type of patent. In addition to machines, processes, and component parts, utility patents are also issued for inventors of improved existing patents. The improvement must be non-obvious to a person having ordinary skill in the same area of technology related to the invention. For example, a person cannot simply change the color of a machine and get approved for a new patent.
Utility patents must be useful, serve a legal purpose, and be “novel.” If a substantially similar process or product has been marketed in the past year, the application will be rejected. It must be man-made—naturally occurring things cannot be patented. Also, the product or process must actually work. Patents will not be issued for ideas, theories, and inventions that do not work. A utility patent lasts for twenty years.
Unlike copyrights and trademarks, there are no state versions of patents (only federal) and there is no common law protection. You do not get a patent simply by inventing something—you must apply and be granted a patent by the federal government.
If you have any questions about protecting your intellectual property, give Jesson & Rains a call!
By Attorney Kelly Jesson Rains
A copyright protects an original work of authorship, whether in writing, video, or audio form.
Like trademarks, a common law copyright is created as soon as the work is authored. People should use the copyright symbol © to deter would-be infringers. Also like trademarks, despite the existence of common law protections, there are still numerous reasons for registering federally. To rely on federal copyright protections (versus state court), the work must be registered. This is important because federal law provides statutory damages, whereas in state court you might have to prove actual damages, which is difficult. If a registration application is submitted to the U.S. Copyright Office within five years after first publication of the work, it will be presumed that the copyright is valid. Finally, registering puts the world on notice that you own the work (and who to contact if someone wants to use the work for a fee). Copyrights last for the author’s life plus seventy years.
Sometimes, the author of the work does not own the copyright. This is true in two situations:
1) Work made for hire, and
2) Work commissioned.
These are two very narrow exceptions that are improperly overused. For the “work made for hire” rule to apply, an employee must create the work in the scope of their employment. This is oftentimes up for interpretation and dispute. A work that was not created within the scope of a creator’s employment cannot be made into a work made for hire by way of agreement.
Specially ordered or commissioned work is limited to the following uses:
Of course, an author can sell a copyright to another person. If the copyright is assigned or licensed to another, the author may limit the purchaser’s use.
While the Digital Millennium Copyright Act (DMCA) did not expand copyright protection, in 1998, it did make available a procedure whereby a person whose copyright is being infringed upon can send a notice to an internet provider, webhost, or search engine who must then take down the offending material. The law has specifics about what the notice has to include for it to be valid.
If you’re interested in getting more information about copyright or other intellectual property protection, please give Jesson & Rains a call.
A trademark is a “word, phrase, symbol and/or design” that identifies and distinguishes the goods or services of the owner of the mark from another party. Examples include brand names, slogans, tag lines, logos, and design elements (think, Tiffany blue boxes). In order to get a federal, registered trademark, the mark has to be used in commerce, so normally the owner of the mark is a business or business owner. Someone can apply for a trademark before the mark is used in commerce if the owner intends to use it in commerce, but the United States Patent and Trademark Office (“USPTO”) will not register the trademark until the applicant shows that it is actually being used. Trademarks don’t expire, as long as the mark continues to be used in commerce and the owner files periodic documentation with the USPTO.
The trademark application process is fairly simple, but actually obtaining the trademark can be quite tricky. Not only does the applicant have to worry about the application being denied because the mark is too similar to another in a similar industry (“likelihood of confusion” according to the USPTO), but the applicant has to worry that the USPTO will deny the application for other grounds such as the trademark being “merely descriptive.” For example, the name “Northeast Interiors” merely describes the business (interior design in the Northeast). The strongest trademarks are “fanciful and arbitrary,” meaning they are words that have no relation to the good or service sold (like Apple computers), and the second strongest trademarks are “suggestive” meaning they suggest the good or service without literally describing it (think, Facebook). Unfortunately, most people name their businesses something that describes them for marketing purposes! Is marketing more important or trademarking? This depends on the nature of your business.
A business can also have a common law trademark, but there are benefits to federally registering: first, inclusion in the national database deters others from using similar marks in similar industries; second, there is a legal presumption that the registrant owns the mark and was the first to use it, meaning that in a dispute with another, they would be presumed to be the winner.
A common law trademark is established simply by a business starting to use the mark in commerce. The mark should be identified with the ™ symbol. Only a federally registered trademark can use the ®. A common law trademark is limited in geographic area, so you could have a competitor business open up with the same name in an entirely different state, as long as you didn’t share customers. If a competitor opens in your geographic area, you could sue them for trademark infringement if they did damage to your mark. You would have to prove you were the first to use the mark (unlike having a presumption in federal court).
If you’re thinking of trademarking something in your business, give Jesson & Rains a call!
What is intellectual property?
“Intellectual” property refers to creative works used in business that have economic value. The four most common types of intellectual property (“IP”) are trademarks, copyrights, patents, and trade secrets. Trademarks protect words, names, symbols, and logos that are identified with a brand; copyrights protect artistic works like books, music, and photographs; patents protect inventions; and trade secrets are property that are valuable and have been kept secret and out of the public domain.
We’ll be starting a series explaining each of these types of property in detail over the next few weeks. As the word “property” signifies, intellectual property is an asset. Thus, it is important for both business planning and estate planning. In the business context, it is crucial to determine who owns the IP. Is it the individual who brought it into the business (and will take it with them when they leave) or does the business itself own it? If there is a possibility for litigation, it may be worthwhile to form a separate LLC to own IP so the other business assets stay separate and protected. Next time you look at fast food packaging, you’ll probably see that the company’s trademarks are owned by a separate business.
For estate planning purposes, we want to know about IP just like any other asset – how much is it worth? Who inherits it? So make sure to share this information with your estate planning attorney.
The next blog article will go into trademarks. Stay tuned!
Subscribe to our newsletter.