Intellectual Property Primer
About the Author
Judith Silver
Judith is CEO and Founder of her virtual law practice, Coollawyer Legal Forms, which provides e-commerce forms and legal advice for Internet and technology companies. She served as in-house counsel at Adobe Systems and Sabre/Travelocity.com prior to starting Silver Law Inc. She holds a B.A. cum laude from Cornell University, her J.D. from University of California, Hastings College of the Law and is licensed in CA, FL and TX.
By: Judith Silver
April 15th, 2002
Note: Readers are cautioned not to rely on this information as legal advice and to always consult with an attorney in their jurisdiction.
Intellectual Property is the group of legal rights in things people create or invent. Intellectual property rights typically include patent, copyright, trademark and trade secret rights.
The Origins of IP
Most people are surprised to discover that Intellectual Property rights originate with our Founding Fathers in the Constitution (Article 1, Section 8, Clause 8), which states that Congress shall have the 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."
The right to exclusive ownership and use of one's inventions and the monetary rewards from giving others permission to use them complement the other beliefs of our Founders.
In the middle to late nineteen century, these beliefs grew into capitalism, which embodies:
- the benefits and rewards of hard work (as remained from Puritanism);
- the exchange of business ideas through products and services; and
- competition in the marketplace and financial reward for the most popular or beneficial ideas.
It wasn't accidental that capitalism had many of the same theoretical bases as Charles Darwin's notions of survival of the fittest from the same time; author and Harvard biology professor Stephen Jay Gould states that Darwin read Adam Smith prior to writing his "survival of the fittest" theory.
Indeed, intellectual property law, with exception of patents which preceded the rest in codification by several centuries, reached major legal codifications in this same period -- during the late eighteenth to late nineteenth century. These laws sought to ensure that the best and most popular inventions and creations earned monetary compensation for their creators. This, in turn, inspired others to create through discussion and understanding.
Balance is the Heart of IP Law
The heart of intellectual property law is the balancing of:
- financially rewarding creation through granting of exclusive rights to the author, and
- promoting the free flow of ideas to facilitate more creation.
This balance is two-fold:
- The tension between the reward of ideas and the encouragement of new ones.
- The balance between the "Promotion of Science and Useful Arts" Constitutional clause above, and the First Amendment. This is an equally compelling tension between ownership of arts, words and invention, and the freedom of Americans to speak and express themselves without restriction.
This balance is visible through all the laws and all the cases about intellectual property in the United States. If you keep this tension in mind, everything else becomes much easier to understand.
So let's consider briefly what rights are granted under:
- patent law
- copyright law
- trademark law
Patent
Origins
The United Kingdom Patent Office states that the first patent was issued in London in the fifteen century. In the United States, the first patent was granted in 1790.
When Do You Get a Patent?
After inventing a work, the inventor must apply for and obtain a patent from the US Patent and Trademark Office in Washington, DC.
What's Required to Get a Patent?
In order to patent something, you should have a patent attorney who's licensed to practice before the Patent Office assist you with the application. Upon receipt of your application, the Patent Office will examine it to determine whether it meets the legal requirements for obtaining a patent. The requirements are extremely complex, but in simple terms, state that your invention must be:
1. Novel
This means it must not be:
- known or used by others in this country, or
- patented or described in a printed publication here or abroad, or
- in public use or on sale in this country more than one year prior to the application for patent.
2. Non-obvious
This means it must not be obvious to a person having ordinary skill in the pertinent art as it existed when the invention was made
3. Useful
This means it must have current, significant, beneficial use as process, machine, manufacture, composition of matter, or improvements to one of these.
The Patent Office defines the terms above as follows:
- "'process' is defined as a process, act or method, and primarily includes industrial or technical processes.
- 'machine' ...needs no explanation.
- 'manufacture' refers to articles which are made, and includes all manufactured articles.
- 'composition of matter' relates to chemical compositions and may include mixtures of ingredients as well as new chemical compounds.
These classes of subject matter taken together include practically everything which is made by man and the processes for making the products."
Certain kinds of software and internet-related processes merit granting of patents.
What Do You Have When You Have a Patent and Is There Any Risk?
If the patent is granted, you receive a 20 year monopoly on selling, using, making or importing the invention in or into the United States.
What is granted is not the right to make, use, offer for sale, sell or import, but the right to exclude others from making, using, offering for sale, selling or importing the invention.
You should be aware of two risks.
First is that obtaining a patent can be expensive. You should consult your patent attorney to get a specific estimate, but the application and granting process can take years and require substantial legal work.
Secondly, be aware that in exchange for your patent rights, your patent (i.e. how the invention works), becomes public information so that others may learn from your ideas and create further. Due to the disclosure result, many often opt not to seek patent rights so that they can keep their invention and ideas secret.
Copyright
Origins
According to the United Kingdom government, the Statute of Anne was the first statute to legally address copyright during the eighteen century. In the United States, the first copyright law was passed in 1790.
When Do You Get a Copyright?
Upon creation (in a fixed form), a creator (author) has a copyright in the work.
What's Required to Get a Copyright?
You do not need to apply or register to have a copyright; you receive copyright protection when you create the work. However, registering your work expands your protections and sometimes can be done without disclosing the entire work. Depositing a copy of your work with the Copyright Office within 90 days of creation also protects your work, as it provides a legal record of the creation date, and allows others to have notice of your ownership rights.
The following categories of works have copyright protection:
- literary works
- musical works, including any accompanying words
- dramatic works, including any accompanying music
- pantomimes and choreographic works
- pictorial, graphic, and sculptural works
- motion pictures and other audiovisual works
- sound recordings
- architectural works
Software, sometimes the GUI, and Web pages have copyright protection.
The following do not have copyright protection:
- Works that have not been fixed in a tangible form of expression, (for example, choreographic works that have not been notated or recorded, or improvisational speeches or performances that have not been written or recorded)
- Works without enough "originality" (creativity) to merit copyright protection: titles, names, short phrases, and slogans; familiar symbols or designs; font design; ingredients or contents; facts; blank forms, etc. As there is great tension here between granting incentive and financial reward when something is worthy, but not granting it to things so basic and commonly used that everyone would be forced to pay, the law is somewhat unclear in this area.
- Ideas or concepts. Copyright protects the expression of the idea, but not the ideas themselves. This is easier to understand if you remember the goals of our Founding Fathers -- to reward creations, but protect the free flow of ideas and information. For example (*this is Plato's explanation of the concept long before copyright), if I ask you what a chair is, you get a picture in your head; the picture I get in my head is different; the picture Buffy gets in her head is different. These are the "ideas" of what a chair is. However, if you draw the chair in your head or use words to describe the chair, that the "expression" of the idea and that is protected by copyright.
What Do You Have When You Have a Copyright and Is There Any Risk?
The 1976 Copyright Act gives the owner of a copyright the exclusive right to:
- copy the work
- modify the work (create "derivative works")
- distribute the work
- perform the work publicly
- display the work publicly
The length of copyright protection can be complex, but generally lasts 70 years after the death of the creator.
As registration of copyright is not required for protection and some registrations can be done without full disclosure of the work, persons that want to keep their creation secret often opt to rely on copyright protection for their work. If registration is desired, it is relatively simple and inexpensive.
The Public Domain
The "Public Domain" refers to created materials which either do not by law get copyright protection, or their protection under the law has lapsed. By definition, materials in the public domain do not have copyright protection and thus you do not need the owner's permission to use these materials.
Contrary to the wording, however, whether materials are in public has no relationship to whether they fall into the Public Domain. This mistaken notion has somehow led many to believe that everything on the Internet is in public and therefore in the Public Domain, and is thus freely usable without permission. This is completely false.
Trademark
Origins
According to the United Kingdom government, the first trademark legislation was in the late nineteen century. In the United States, the first federal trademark legislation was enacted in 1870.
The Purpose of Trademark Law
The trademark act, or "Lanham Act", 18 USC Sec. 1051 etc. , is meant to allow consumers to correctly identify the sources of goods or services.
For example, when we buy a pair of Nike shoes, we want to know that Nike made them and they are of the quality and come with the guarantees that Nike, as a company, offers consumers. Trademark law allows Nike to stop other companies who might make cheap shoes and copy the Nike logo on it from doing so.
Allowing a third party to use the Nike mark on its products, would:
- allow it to easily sell products by taking advantage of the money which Nike has spent on advertising, brand development, warranties and customer service, and other techniques to develop goodwill and loyal customers;
- allow it to offer its products at lower cost than Nike due to lower overhead; and
- injure Nike because the consumer would associate bad performance of the products with Nike or will try to return products never sold by Nike to Nike and would be angered if Nike refused to take such products back.
When considering whether there is "trademark infringement", the main question a court considers is whether the average consumer would be confused as to the source of the good or service.
What is a Trademark?
A trademark is either a word, phrase, symbol or design, or combination of words, phrases, symbols or designs, which identifies and distinguishes the source of particular goods or services. A service mark is the same as a trademark, except that it identifies and distinguishes the source of a service rather than a product.
Normally, a mark for goods appears on the product or on its packaging, while a service mark appears in advertising for the services. A "tm" on a product indicates unregistered trademark rights and an "®" indicates a registered mark. It is illegal to place an "®" on a mark that does not have national registration.
Marks fall into several categories: arbitrary or fanciful, suggestive, or descriptive.
Arbitrary and Fanciful Marks
The marks most easily registered are those which are arbitrary or fanciful. These marks are those that have no obvious association with a particular good or service and/or are made up. Yahoo is a perfect example of a fanciful mark. Blue Diamond Almonds is an example of an arbitrary mark.
Suggestive Marks
Marks which are next most easily registered are suggestive. These marks require the consumer to give some thought to understand the association. Greyhound Buses is an example. A consumer must think about the characteristics of a greyhound (fast, sleek, etc.) and associate them with the bus service.
Descriptive Marks
Marks which describe a product or service, describe a product or service through use of a Surname (Smith's Plumbing), or describe a product or service through use of a geographical word (Napa Valley Chardonnay), may be difficult to register. When a mark is truly "descriptive", as opposed to "suggestive" is often subjective and depends on the USPTO examining attorney and how well your attorney can argue your application.
The idea behind denial of registration is that applicants who merely describe products should not be able to monopolize use of the words necessary to do so, as the general public and their competitors also need to be able to describe products and services without concerns about trademark infringement. The USPTO will grant the mark if a company can prove that consumers identify of a product or service with a source through a descriptive mark.
Trademarks are generally not granted in generic words, phrases, symbols or designs; immoral or scandalous words, phrases, symbols or designs; false, misleading or mis-descriptive words, phrases, symbols or designs; or surnames.
When Do You Get a Trademark and What's Required to Get a Trademark?
You may apply for registration of a trade mark or service mark after you use a mark to identify a product sold or service performed "in commerce" -- or for advertising and/or sale to customers. You may also register your company's intention to use a mark prior to its actual use and then have up to six months to file the actual application with a sample of its actual use.
You are not required to obtain national register of a trade or service mark. Trademark rights arise upon use in commerce. However, national registration expands and protects your trademark rights, giving your company a presumption of first use of the mark in association with particular goods or services.
When you formally apply for national registration of a mark, you must submit:
- an application,
- drawing of the mark if graphic, and
- sample of the mark as you have actually used it to identify your company's product or service.
Obtaining full registration of a mark usually takes up to several years due to the slow response rate of the USPTO which generally responds to correspondence once every six months. It is best to have an attorney handle the USPTO filing of the application and correspondence with the USPTO since the correspondence usually uses highly legal jargon and case citing with regard to analyses and argument about the application.
Trademark Searches
As trade and service mark rights are allocated on the basis of actual use in commerce, and are priority based on time and geography, not everyone registers marks -- registration isn't required in all cases. This means that when you apply for a trademark, you may wish to get a "trademark search".
A thorough trademark search includes phone books, newspapers, the Internet, state company trade name registrations, the USPTO and other sources and the typical price is about US$750. The results of such a search are several hundred pages of analyses of similar words and/or graphic representations of the marks from the US including many that may not be registered but may have prior rights in the marks.
A mark search is not a requirement of registration but if you choose to apply without one, you are taking two risks:
- the USPTO may reject your mark due to pending applications not yet updated in the USPTO database, or because of the USPTO's own national search for the mark; and
- even if your company obtains permission for proceeding with the application from the USPTO, another party may claim prior use of the mark during the application process (called 'opposition') or after you receive registration and contest your rights to use the mark due to their prior use.
Therefore, it you intend to invest large sums of money in brand recognition, corresponding domain name or company name recognition, a full search rather than a lesser search is the smart choice. Alternatively, if you are not particularly attached to the name of your company, are willing to change it in the future if necessary and want to take the risk by saving money early on, skipping a search may be more in line with your business goals.
What Do You Have When You Have a Trademark?
Trademark registration may allow to you to prevent others from using the same or similar mark with similar products or services by giving you a presumption of first national use of the mark in the US. To explain it another way, a mark allows a company to ensure that their customers know which products and services are made by them through use of a word, phrase, symbol or design -- their trademark.
If another company uses your mark to sell similar products or services, you may bring a trademark infringement claim against such company to stop their use. These cases are usually decided on priority of use, geographical use and consumer confusion with regard to the source of the mark. Trademark rights are indefinite as long as use of the product or performance of the service in commerce continues, your company makes attempts to control use of the mark by others, and the trademark is renewed every ten years.
Domain Names
Having trademark rights is also important with regard to current law and domain names. Presently, the USPTO will not register a domain name that does not merit trade or service mark rights under traditional analysis. The name by itself is considered merely an address. Thus, it is very important to be sure to use your domain name as a trade or service mark in order to ensure retention of the domain name. Under current law, trademark owners may be granted ownership of their trademarks through arbitration or court if a party without trade mark or other rights is using their mark -- in other words, trade mark holders can take domain names which utilize their marks from registrants.