Copyrights, Trademarks, Service Marks, Patents, and Trade Secrets Comprising Intellectual Property

Copyright protection is the means by which authors establish their rights of ownership in a fixed tangible medium of expression. Authors may transfer their ownership rights to third-party owners, or it is possible that authors do not establish ownership because of contractual arrangements where the work is created by an author but owned by someone else. By copyright, an owner has basically five exclusive rights of the copyrighted work including:

  1. Right of reproduction. The work's owner has the exclusive right to determine duplication, transcription, and imitations of the work.

  2. Right of modification. The work's owner has the exclusive right to modify the work, thereby creating a new work. Legally, a work that is a modification of an original work is known as a derivative work.

  3. Right of distribution. This is the right to determine the distribution of copies, including derivative works, to the public by sale, leasing, lending, or rental.

  4. Right of public performance. This is the right to play, dance, recite, act, or display the work at public places, and to transmit the work to the public. In the case of audiovisual works such as movies, showing a movie is considered a public display.

  5. There is a connected right called the Right of public display where the copyright owner has the right to control the showing of a copy of the work directly or by means of film or electronic transmission.

The copyright owner's rights are subject to a number of legal exceptions and limitations giving others the right to make limited use of a copyrighted item. Here are a few of the major exceptions:

  • Ideas and concepts. Copyright laws only protect against the taking of a protected work's "expression" in an unauthorized fashion. Copyright does not include the copyrighted work's processes, procedures, ideas, concepts, discoveries, and methods of operation.

  • Originality. A work's facts are not considered protected under copyright. Regardless of the measure of effort expended by the author or owner, copyright protects the work's originality only.

  • Separate and independent creation. Copyright does not protect a work where someone else working independently creates an exact duplicate of a copyrighted work. Independent creation of an analogous, exact duplicate, or similar work does not violate the owner's rights.

  • Fair use of copyrighted works. Using works under fair use is limited to criticism, news reporting, teaching, comment, scholarship, and research. Such use is not considered an infringement of the work's copyright. By virtue of the copyright, a work's owner is deemed to have consented to the use of their works by others within fair-use constraints.

Works that Can Be Copyrighted

Copyright laws protect the rights of ownership, grouping works into the following general categories:

  • Literary works, which may consist of novels, nonfiction works, poetry, newspaper articles, magazines and magazine articles, computer software, software documentation, applicable software manuals, catalogs, training manuals, manuals, advertisements, and brochures

  • Dramatic pieces such as plays, theater productions, and operas

  • Musical works such as songs and instrumentals

  • Movies and other audiovisual pieces, including movies, training films, documentaries, television programs, news programs, movie and television advertisements, video games, and interactive productions

  • Choreographic works such as ballet, dances, and mime

  • Graphic, pictorial, and sculptural works such as paintings, drawings, photographs, posters, works of fine art, display advertisements, graphic art productions, cartoon characters, statues, and toys

  • Architectural works including building designs, plans, drawings, and the building itself

Copyright Protection

Interestingly, copyright protection arises automatically when an original work is marked with a tangible medium of expression. Registering the work with the Copyright Office is optional but must be completed before an infringement suit is filed. Copyright marking may take any of these forms:

  • The symbol © followed by a date and name

  • The word "Copyright" followed by a date and name

  • The abbreviation "Copr" followed by a date and name

Duration of Copyright Protection

Currently, the effective term for copyrighted works created by individuals is the life of the author plus an additional 70 years. The period of copyright protection applying to works for hire is 95 years from the date of publication or 120 years from the date of first publication, whichever date is sooner.

Copyright Infringement

Copyright infringement is basically defined as violating any of the exclusive rights granted to the copyrighted work's owner. Copyright owners can recover actual and punitive damages resulting from infringement as well as reporting violations considered criminal. Federal district courts have the power to restrain infringers and order the seizure (impoundment) and destruction of illicit copies. Disputes over copyright ownership are civil matters and are settled through legal proceedings.

Criminal Actions in Copyright Cases

Federal criminal laws address copyright infringers, who may be prosecuted under 17 U.S. Code 506 and 18 U.S. Code 2319. Elements of these laws include any person infringing a copyright for the purpose of commercial or private gain by the reproduction or distribution of copyrighted works having a total retail value of more than $1,000.

Title 17, Section 506 specifies that evidence of a person involved in the reproduction or distribution of a copyrighted work is not sufficient to establish willful infringement.


Experience Note

Judging from the criminal matters that have been prosecuted and adjudicated, there appears to be a need for financial gain motive before prosecution will move forward.

Criminal Copyright Forfeiture

Individuals who are criminally convicted for copyright violations may suffer additional punishment under legal provisions, including the forfeiture and destruction or other disposition of all infringing copies (more statute information is available at caselaw.lp.findlaw.com/scripts/ts_search.pl?title=17&sec=506 and caselaw.lp.findlaw.com/scripts/ts_search.pl?title=18&sec=2319).

Resolving copyright matters is accomplished by civilly suing the defendants with the objective of financial settlement and criminal prosecution.

Works that Cannot Be Copyrighted

Works created by federal government employees as part of their official duties cannot be protected by copyright. For this reason, policies, procedures, laws, discussions, presentations, and related items originating with government agencies are not protected as copyrighted works. Consequently, these works are usually considered part of the public domain. Federal government employees may copyright works they produce on their own time but not those done as part of their official duties. Further, employees of state and local governments may copyright works they produce as part of their official duties.

Trademarks and Service Marks Protection

Trademarks and service marks are words, symbols, or other unique devices used by manufacturers to identify their goods and services, distinguishing them from similar goods and services sold by others. Trademarks are customarily used for goods, while service marks are used for services. When registered, they may not be used or displayed without consent of the mark's owner.

Trademarks and service marks are protected under the federal trademark statute, known as the Lanham Act.

Criminal Prosecution for Trafficking in Counterfeit Goods or Services

Under the provisions of 18 U.S. Code 2320, it is prohibited for a person or persons to traffic in goods or services that are identified by identical or substantially indistinguishable marks registered with the U.S. Patent and Trademark Office. This law protects the mark's owners from those that would produce like or similar marks for their goods and services.

Anyone criminally convicted for this crime, depending on the facts and circumstances, could receive a maximum prison sentence of not more than 10 years and a fine of not more than $2 million; if there are defendants acting together other than an individual (such as a business), then the fine could go as high as $5 million.

Protected Works

There are many types of trademarks that can be protected; for example, "Dell" is a registered trademark of Dell Computer Corporation, "IBM" is the registered trademark for International Business Machines Corporation, etc. Sounds, jingles, and shapes can also be registered as trademarks; for example, the music introducing the "Today Show," the shape of the Coca Cola bottle, or the Bar and Shield logo for Harley-Davidson Motorcycles.

Trademark protection is extendable to words, names, symbols, or unique devices distinguishing the goods and services offered by an owner from those offered by others. Basically, a trademark identifying a class of goods or services distinguishing the class of goods or services is not going to qualify for protection. Trademarks and service marks must apply to specific goods or services and not general classes. For example, the word "fishing rods" describes a class of instrument used for catching fish, where "Browning fly-rod" distinguishes the manufacturer and type of fishing rod.

Trademark and Service Mark Protection

Trademark and service mark protection is obtained by filing a registration application with the U.S. Patent Office.

Protection under federal law is applicable to marks actually used, or intended to be used, in interstate commerce. In the case of federally registered trademarks or service marks, the use of public mark registration notice is optional. Registered trademark owners may provide symbolic or other type of notice indicating their trademark is registered by displaying the words, "Registered in the U.S. Patent and Trademark Office" or by merely displaying the ® symbol.

Trademark and service mark rights in the case of a federal registration can last indefinitely, provided the owner continues to use the mark on or in connection with goods or services and files the necessary documentation with the U.S. Patent and Trademark Office. Registration forms and filing times for marks are available at the U.S. Patent Office Web site.

Federal trademark and service mark registrations actually remain in effect for 10 years, on the condition that an affidavit of continued commercial use is filed with the U.S. Patent and Trademark Office in the sixth year of the registration. Mark registrations may be renewed for an indefinite amount of 10-year terms, provided the mark continues to be in commercial use.

Trademark and Service Mark Ownership

Owning a registered mark provides several protections to owners:

  • Exclusive commercial and private use of marks identifying specific goods and services as belonging to a particular organization or person

  • Notice to the public of the mark's ownership

  • Ability to enforce the mark's ownership through civil action in federal district court

  • Use of the federal registration as a basis to obtain registration in foreign countries

  • Use to file the U.S. registration with the U.S. Customs Service to prevent importation of infringing marks

Public Notification

Any time claims are made to a mark, the symbols TM or SM may be used to alert the public to the mark's claim, registered or not. However, the ® symbol may only be used after the mark is officially registered and only with goods and services listed in the federal trademark registration.

Internet Domain Names and Registered Marks

Domain names are the mechanism by which many private and open-ended computer systems function. Forming a computer network requires two basic elements: two or more computers connected together, and a common language or protocol allowing them to exchange information. Domain names are important to information providers because they deliver a user-easy name instead of the only-numbers method of connecting information seekers to information providers.

In short, regardless of the nature of the system, information cannot be exchanged easily through e-mail, newsgroups, instant messaging services, chat rooms, or the Web without domain names. Procuring a domain name for the Internet is as basic as contacting a registration authority (commonly known as a domain name registrar), determining that the desired domain name is not already registered, filing a domain name registration application, and paying the registration fee. Registration ensures that only one party can "own" the domain name at a time. And as long as the registrant pays the registration fees, he will continue to own that domain name indefinitely.

In the world of the Internet, if the information provider is a commercial entity, then its domain name will be significantly more effective if it is the same or similar to its registered marks. However, often it is discovered that someone has registered a domain name that corresponds to a business' trademark, preventing the business from owning it. What recourse does a business have when discovering that its domain name is unavailable for ownership or use? Should there be a regulation or law allowing the trademark owner to own a domain name corresponding to its trademark when it has been registered to someone else?

Acquiring exclusive trademark rights is as simple as using the trademark in commerce. Using trademarks or service marks, without registration, entitles users to common law trademark ownership. This type of trademark right extends only to the market boundaries where the mark's owner has actually used the mark.

Owners can obtain broader ownership rights by registering marks with the U.S. Patent and Trademark Office where the mark's exclusive use in a broad marketplace is guaranteed by federal registration.

Primarily, trademark rights are granted to protect the public from confusion about goods and services sold in the marketplace. Consequently, if it is discovered that someone other than the trademark's owner is using a trademark, causing confusion in the marketplace, the owner is able to file suit for infringement. An interesting case develops when similar trademarks are used for different goods or similar trademarks are used in separate geographical areas. Here, it is supposed there exists a small chance the public will be confused; consequently, both trademarks may be used simultaneously.

With the Internet, registered and unregistered marks change in a way that could not have existed a few years ago. Because the Internet allows virtually anyone to access goods, products, and services spanning all types of trade channels, it is possible there exists a significant degree of confusion between Porsche automobiles and Porsche umbrellas.

Cybersquatters

Enter the cybersquatters as factors in domain registration. These are people who register trademarks as a domain name for the purpose of selling it to the owner of the trademark. They have little, if any, intention of using the domain name in commerce. Many organizations and businesses have paid significant amounts of money to buy domain names containing their trademarks from cybersquatters who registered the domain name before the rightful owners were able to do so. Domain name registrars simply do not require registrants to show that there is any connection to the specific domain name. For example, in 1998, Compaq paid about $3 million for the domain name "Altavista.com" that was registered to someone other than Compaq, according to the Wall Street Journal, July 29, 1998.

Cybersquatting is generally identified by two basic elements:

  1. Presence of a unique and famous trademark

  2. Registration of a related domain name

In the event these cybersquatting elements are not present, a traditional trademark infringement assessment is pursued, looking at the uniqueness of the trademark to:

  • Determine if the domain name is being used as a trademark or service mark

  • Determine if the mark is legally protected

  • Determine if the registered domain name results in a likelihood of consumer confusion between the domain name and the mark

There are organizations and famous individuals that choose to fight rather than pay for their namesake. For example, Panavision International was one of the first companies to sue and successfully prevail against a cybersquatter for diluting their trademark (Panavision International, L.P. v. Toepen, 141 F.3d 1316, 9th Circuit, 1998).

Cybersquatter-Victim Protection

With potential confusion looming about domain names and mark owners, there are two avenues to address cybersquatters: the Anticybersquatting Consumer Protection Act, 15 U.S. Code 1125.

Administratively, domain name conflict resolutions can be affected through the ICANN (Internet Corporation for Assigned Names and Numbers) and their Uniform Domain Dispute Resolution Policy, available at icann.org/udrp/udrp.htm.

In the Anticybersquatting Act signed into law in November 1999, there is a means to predicate civil actions charging defendants with trademark infringement when domain names are in dispute. A mark's owner, the plaintiff, must prove that the cybersquatter registering the domain name infringed on the mark's owner and exhibited bad faith, intending to profit from the domain registration's sale. Elements that support bad faith on the part of the cybersquatter are:

  • Determine any intellectual property rights the domain name registrant has with regard to the domain name

  • Determine the use of the domain name in the sale of goods or services on the part of the registrant

  • Determine the domain name owner's intention to divert consumers from the plaintiff's Web site

  • Determine the domain name owner's intention to dilute or tarnish the value of the trademark by confusing consumers

  • Determine domain name registrant's efforts to sell or assign the domain name for financial gain without having used it for bona fide purposes

In 1999, ICANN approved the Uniform Domain Name Dispute Resolution Policy providing a procedure for resolving domain name disputes. This is an administrative procedure and not a judicial one. To be successful, complainants must:

  • Identify how the domain name is identical or sufficiently confusing with respect to the mark in question

  • Identify that the domain name owner has no legitimate interest in the name

  • Identify why the domain name should be considered as having been registered in bad faith

All domain name registration agencies are bound by this policy, and all registrants agree when applying to register a domain name or renewing a domain name registration. The domain name registrant warrants or agrees to the following:

  • Information made in the Registration Agreement is complete and accurate

  • Domain name registration will not infringe upon or otherwise violate the rights of any third party

  • Domain name is not being registered for any unlawful purpose

  • Domain name registration is not in violation of applicable laws or regulations

  • It is the responsibility of the registrant to determine if the domain name registration infringes or violates another's rights

The Uniform Domain Name Dispute Resolution Policy considers bad faith registration as the registration of the domain name primarily for the purpose of selling, renting, or transferring the domain name to the trademark's owner. Administration of this dispute policy is usually completed in roughly six weeks with fees approximating $1000. If the complainant is successful, the domain name registrar (domain name registration agency) will either disconnect the domain name or transfer it to the complainant.

Complainants must allege facts and circumstances focused in the following areas:

  • The domain name in question is identical or confusingly similar to a trademark or service mark in which the complainant has legitimate rights

  • The domain name registrant has no rights with respect to the domain name

  • The domain name has been registered and is being used in bad faith

Victims of cybersquatting can select between remedies based in federal civil law and those administered by ICANN. Actions filed under the Anticybersquatting Act permit victims to sue defendants for infringement, unfair competition, and mark dilution. Remedies available under this law include but are not limited to:

  • Actual damages

  • Punitive damages

  • Attorney's fees

  • Injunction against defendants pending the resolution of claims

ICANN's Domain Name Dispute Policy provides a measure of conflict resolution by canceling the registrant's domain name or transferring the domain name to the successful claimant. Of course, the resolution must be supported by evidence before the arbitration board. ICANN's policy process is significantly more economical and expedient than civil actions filed under the federal statute and yet does not preclude future legal action against the domain name registrant.

Patent Protections

Patents are issued only by the U.S. Patent and Trademark Office, as individual states are prohibited from granting them. Patents are basically property rights delivered to an invention's owner. In the language of the Patent Act is the grant of ownership providing for the ability to exclude others from making, using, offering for sale, or selling the invention in the United States or importing similar inventions to the United States.

Patent laws protecting inventions are known as utility patents, while ornamental designs for articles of manufacture are known as design patents. Utility patents include any new and useful processes, machine, manufacture, or composition of an item or any new useful improvement.

Inventions may be electrical, mechanical, biological, or chemical. Internet-related inventions such as interfaces, networking protocols, information retrieval methods, and encryption might be protected by utility patents.

Qualifications for Design Patents

In order to be granted a design patent, the invention must be new, original, and ornamental. Design patents are limited to the ornamental appearance of an item and little more.

Qualifications for Utility Patents

Utility patents are granted for inventions that are new, useful, and not obvious. To qualify for registration, the invention must be unknown or used by others in the United States before a patent may be granted. Utility patents are granted for unique devices that add to the public's knowledge and are useful to society. Inventions must be sufficiently distinct from currently existing technology and must not be obvious to a person of ordinary skill in the invention's field.

"Firstest with the Mostest"

The inventor who actually invents the claimed item, not the inventor who files first for the patent, becomes the patent owner. This is a significant departure from many other countries that have the first-to-patent rule granting the patent to the first inventor to file for an invention's patent.

Utility patents are difficult to obtain in the United States. If an invention meets the levels of uniqueness, usefulness, and lack of obviousness, a patent may not be granted if the invention was described more than a year before the actual patent application date. This also applies to inventions in public use or sale in the United States for more than one year before the patent application date.

Filing for Patent Protection

Before filing a patent, there are several considerations that should be made. Although individuals without specialized training and experience can file a patent application, the process is expensive and time consuming, generally taking upwards of two years or more. In applying for patents, it is highly recommended that patent attorneys and patent agents (persons who have passed Patent Office examinations) are used in the process to avoid pitfalls and unnecessary delays.

Patent Ownership

Patent owners have the right to exclude others from manufacturing, selling or offering for sale, using, or importing a similar item to the United States. This exclusive ownership has a term of the patent. Anyone who violates these ownership rights is deemed an infringer.

Patent Terms

Current laws allow utility patents to be granted for a period of 20 years from the date the patent's application was filed.

Patent Validity

Patents might be subject to legal challenges based on infringement allegations. Infringement suits question the patent's validity by alleging the patented invention was not sufficiently novel or not obvious or belongs to someone else.

Trade Secrets

Trade secrets are basically defined as information that is valuable and maintained as secret. To qualify as trade secrets, information must be preserved as secret by the owner having taken reasonable steps to keep it from general knowledge.

Protected Trade Secrets

These are some types of business and technical information that are protected by trade secret laws:

the term trade secret means all forms and types of financial, business, scientific, technical, economic, or engineering information, including patterns, plans, compilations, program devices, formulas, designs, prototypes, methods, techniques, processes, procedures, programs, or codes, whether tangible or intangible, and whether (or how) stored, compiled, or memorialized physically, electronically, graphically, photographically, or in writing.

— 18 U.S. Code 1839

There is also a necessity of being the trade secret's owner and taking reasonable steps in keeping the information a secret:

the owner thereof has taken reasonable measures to keep such information secret; and (B) the information derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable through proper means by, the public; and (4) the term "owner," with respect to a trade secret, means the person or entity in whom or in which rightful legal or equitable title to, or license in, the trade secret is reposed.

— 18 U.S. Code 1839

There are generally some factors that are considered to determine whether or not information qualifies as a trade secret:

  • Extent to which the secret is known outside the owner's business

  • Extent to which the secret is known by the owner's employees

  • Specific measures taken by the owner guarding the information's secrecy

  • Value of the secret to the secret's owner and the owner's competitors

  • Ease at which the secret could be acquired from the secret's owner

There are two federal criminal statutes that apply to the theft of trade secrets; one applies to the theft of trade secrets by a foreign government or its agents (18 U.S. Code 1831), and the other applies to the theft of trade secrets by individuals and their co-conspirators (18 U.S. Code 1832). In both statutes, the theft of trade secrets is contingent upon the following elements:

  • Whether the entity stealing the trade secret is a foreign government or an individual

  • Whether the trade secret is stolen by means of theft, copied, destroyed, etc.

  • Whether the trade secret is received by an individual or foreign government

  • In the case of trade secret theft (18 U.S. Code 1832), whether the trade secret is produced or included in a product placed in interstate or foreign commerce

Criminal Forfeiture

Individuals convicted of violating either of these trade secret criminal statutes can suffer the forfeiture of property connected with both of these laws (18 U.S. Code 1834):

The court, in imposing sentence on a person for a violation of this chapter, shall order, in addition to any other sentence imposed, that the person forfeit to the United States

  1. any property constituting, or derived from, any proceeds the person obtained, directly or indirectly, as the result of such violation; and

  2. any of the person's property used, or intended to be used, in any manner or part, to commit or facilitate the commission of such violation, if the court in its discretion so determines, taking into consideration the nature, scope, and proportionality of the use of the property in the offense.

  1. Property subject to forfeiture under this section, any seizure and disposition thereof, and any administrative or judicial proceeding in relation thereto, shall be governed by section 413 of the Comprehensive Drug Abuse Prevention and Control Act of 1970 (21 U.S. Code 853), except for subsections (d) and (j) of such section, which shall not apply to forfeitures under this section.

Obtaining Trade Secrets Protection

Trade secrets protection automatically attaches when the information belonging to the owner is kept secret. Secret owners are not required to register or notify anyone with regard to their information. Trade secrets' owners have the right to see that civil and criminal actions are leveled at misappropriating or unauthorized use of their trade secret. Trade secrets protection, under the law, lasts as long as the owner engages in security measures protecting it from general knowledge. However, the owner loses protection if she fails to take reasonable steps to keep the trade secret concealed.

Interestingly, discovery of trade secret information by means of independent research or by means of reverse engineering is not legally considered theft or misappropriation. On another note, if an employee leaves her employment with knowledge of trade secrets, and does not have any binding agreements barring her disclosure of the protected information, then she may disclose it to her new employer.

1 comments:

Doug Friant said...

The Architectural Works Copyright Protection Act case T-Peg vs Vermont Timber Works has been decided in Vermont Timber Works favor. You can view details of the case, including public documents and exhibits at:
http://www.vermonttimberworks.com/T-Peg-Inc-Timberpeg-East-vs-Vermont-Timber-Works-Inc.html

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