The basics of intellectual property

Every hour of every day each of us deals with one or more forms of intellectual property.We deal with it at home, at work and during our free time.

Every time we buy something we deal with brands (trademarks).

Almost everything we read, listen to or watch is protected by copyright.

Daily, we use inventions that are or were protected by patents.

And every time we have a Coke or Pepsi, we are drinking something whose formula is a heavily guarded trade secret.

Each one of us also has a right of publicity, which allows us each to determine how our name, image or likeness is used for profit.

As a business owner, employee or lawyer, the first step is learning how to identify your company or client's valuable intellectual property assets so that you can take the next step to protect these assets.

The commonly used shorthand for intellectual property is "IP," which will be used interchangeably with the term intellectual property in this article.

Every business owns intellectual property.

There are four main areas of IP: copyrights; trademarks; trade secrets and patents:

Copyrights are creative works of expression, such as artwork, photography, graphic design, music, text, source code, architectural works and boat hulls.

Trademarks are what businesses use to identify and distinguish what they offer in the marketplace from that which is offered by others, and includes brands, logos, slogans and taglines.

Trade secrets are business secrets that are not known, nor easily learned, by people outside the company.

Patents are unique inventions, designs or processes.

IP rights originate in various ways, depending on the nature of the IP.

Copyrights exist once the work is memorialized or recorded in some form.

Trademark rights are granted to the first person or entity to use a mark is used in commerce.

Use of a mark in intrastate commerce (in only one state) grants rights in that state.

Use of a mark in interstate commerce (more than one state) grants nationwide rights.

Trade secret rights exist once the secret is discovered or created.

Patent rights exist once the patent is granted by the U.S.

patent & Trademark Office (PTO).

IP rights are exclusive because they allow the owner to exclude others from using its IP.

Ownership of IP assets entitles the owner to certain rights.

Most importantly, IP owners may prevent others from using their IP without permission and/or the payment of a fee (usually referred to a licensing fee or royalty rate).

It is sometimes simpler to understand IP rights in terms of what the IP owner can prevent others from doing with its IP.

Copyright owners have the sole and exclusive right to copy, transfer, and publicly perform or display (whichever is applicable) their works, as well as to create derivative works, which are works that are based upon the copyright owner's original creation.

They may also prevent all others from exercising these rights without permission, which usually includes payment of a licensing and/or royalty fee.

Trademark owners have the sole and exclusive right to use their mark on their goods and/or services and to prevent all others from using the same or a similar mark for the same or similar goods and services.

Trade secret owners have the sole and exclusive right to benefit from use of their secret(s) and to prevent the unauthorized use and disclosure thereof.

Patent owners have the sole and exclusive right to create or utilize the invention or process covered by the patent and to prevent all others from creating or using an identical or equivalent invention or process.

IP owners may also transfer some or all of their rights permanently to one entity (by an assignment) or for a limited duration to one or more entities (through licensing).

An assignment terminates the IP owner's rights and transfers those rights to a third party.

Licensing enables an IP owner to continue to use its IP at the same time as one or more others are using it.

The duration of IP rights depends on the nature of the IP.

IP assets are valuable to your business because they are unique and exclusive.

No one else has or can legally use those assets without your permission.

A company can use its IP to generate revenue from third parties through licensing agreements.

Unauthorized use of IP is considered "infringement" and may be remedied by sending cease and desist letters or by filing a lawsuit.

Copyright rights' duration depend upon who created the work and when.

If the work was created and owned by an individual author after Jan.

1, 1978, copyright protection lasts during the author's life, plus 70 years after the author's death.

For works owned by a corporation ("works made for hire") that were created after Jan.

1, 1978, the duration of copyright will be 95 years from first publication or 120 years from creation, whichever is shorter.

For works created before 1978, one must determine who created the work and when and then consult the Copyright Act to determine the duration of rights under the applicable version of the act.

Trademark rights last as long as the mark is used properly.

Proper use includes preventing infringing uses and avoiding naked licensing (licensing without quality control) of the mark.

Trade secret rights exist as long as the secret remains secret.

Disclosure of the secret, even through unauthorized means, can eliminate the trade secret.

Patent rights' duration depend on the type of patent application filed and when it was filed.

Design patents last for 14 years from the date the patent is granted.

Utility patents filed before June 8, 1995 expire 17 years from date of issue or 20 years from date of filing which ever is longer.

Utility patents filed after June 8, 1995 expire 20 years from the date of filing.

IP registration creates a formal government record of the asset.This record serves as proof of certain evidence in litigation, and is like a deed to the IP asset when a business is sold.

Copyright registration is not required for rights to exist, but is required to sue someone for infringement.

Trademark registration is not required for rights to exist, but provides numerous additional and important benefits that are only attainable through registration.

Trade secrets are not registered (as registration would reveal the secret, thereby destroying it).

Patents are the only IP asset that must be registered for rights to exist.

Who in your business deals with IP? Here are some of the ways that the people in your company or client's company deal with IP: * Marketing: trademarks (brands, taglines, slogans, logos); copyrights (logos, marketing collateral) * IT: copyrights (source code) * Design: trademarks (brands, taglines, slogans, logos);copyrights (logos, marketing collateral) * Management: copyrights (company & product manuals, guidelines, plans & strategies); trade secrets; trademarks (promoting the company's brands) * Research and development: patents (inventions, processes) * Sales: copyrights (sales brochures, pitches); trade secrets (your company's unique selling technique) What do you do next, and where do you go from here? Before you can protect your company's IP, you must identify it.Talk to your employees and take an inventory of any creative works (copyrights) your company owns, whether such works are used internally or sold to others.

Determine how your company identifies and distinguishes its products and/or services in from those offered by others the marketplace (through use of trademarks).

Figure out whether your company has any secrets that give it a competitive edge, and whether it has invented anything that may be eligible for patent protection.

Don't forget to make sure that you have permission to use the names, images or likeness of all persons in your marketing collateral and on your company website, etc.

Then, contact an intellectual property attorney to make sure that you did not miss anything and to help you through the registration process.

Lara Pearson, an attorney in Incline Village, focuses exclusively on intellectual property law.


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