TIME TO TAKE STOCK: PROTECT WHAT'S YOURS AND WATCH OUT FOR WHAT ISN'T
All businesses have intellectual property (IP), whether they know it or not. Be it a brand, an invention or website content, IP is an intangible asset that, when properly protected, can enhance the overall value of a business. By the same token, using IP assets of others (no matter how innocent or unwitting that use might be) can threaten the business with liability for unanticipated costs. Here are 10 points to consider about your IP and those of others in the New Year:
1. Patent, trademark, copyright – keeping them straight. Generally speaking, utility patents protect functional ideas embodied in devices, methods and compositions of matter by excluding others from practicing the invention. A trademark is a distinctive word, symbol or device used in connection with goods in commerce to (a) indicate the source of the goods and (b) distinguish them from goods of others. A copyright protects creative expression fixed in a tangible medium, such as videos or literary works including computer software.
2. Consider the value of your brand. With the pervasiveness of social media, protecting your brand has become all the more important. Trademarks (which may be your company name, products, logo or a combination) derive their value from being distinctive. Distinctive marks are stronger and can be more valuable than descriptive ones. While many people are often tempted to use marks that are descriptive, descriptive marks are weak and subject to diminished protection, if they can even be protected at all.
3. Make sure you own the IP your employees create. Employees are an important piece of the IP protection puzzle. A solid employee IP agreement will require employees to protect your IP by making it clear that: (a) your company owns the IP they develop on the job or in your industry while they work for you; (b) the employees are required to keep your proprietary and confidential information secret; and (c) they cannot walk out the door with your IP or your secrets when they leave, among other things.
4. Make sure you own the IP your independent contractors create. Believe it or not, paying your consultant, vendor or independent contractor to develop your website, computer software or marketing materials does not mean that you automatically own the IP for which you have paid them. Without an agreement that says you own it, likely you don't. And, yes, they can turn around and sell what you thought was exclusively yours to your competitor.
5. Protect what you have created or paid for. Once you are sure your company owns what it has created or paid a third-party to create, then put a plan in place to protect that IP through the appropriate protection vehicles or combination or vehicles. The most effective protections can be a web of patents, trademarks, copyrights and trade secret protections developed specifically with your business objectives and business model in mind.
6. Register your copyrights early. To sue for copyright infringement of U.S. copyrights, U.S. copyright registration is now a pre-requisite. In 2019, the U.S. Supreme Court settled a split among various Circuit Courts of Appeals when it issued a decision in Fourth Estate Public Benefit Corp., holding that in most cases the U.S. copyright registration process must be completed prior to suing for infringement based on U.S. copyrights, which can take many months.
7. When you haven't created it, be sure that you have the rights to use the IP someone else created. Just because you find material posted on the internet does not mean you have the right to use it. Works of creative expression on the internet, such as images, articles and content, are still the subject of copyright protection even though they are publicly available. If you intend to use images or content from the internet for commercial purposes, you will need to secure the right to do so from the copyright owner.
8. When you haven't created it, be sure that you have the rights to use the IP someone else created. Stock photo agencies and services use image matching technology to continuously look for copies of copyright holders' images (or even image portions) on the internet. If they happen to find one on your website, you will likely receive a cease and desist letter from an attorney representing the stock photo agency demanding damages for copyright infringement under threat of a lawsuit.
9. When picking a trademark, be mindful of big company trademarks. Some large, well recognized companies can be very aggressive in enforcing their trademark rights taking an overly expansive view of the breadth of their trademark rights.
10. Be mindful of big company trademarks. Reprise. Designs for goods, clothing, shoes, toys, sports apparel to name a few can also be registered as trademarks if they function as a source identifier. Well-resourced companies who aggressively enforce their trademark rights often take advantage of this protection by recording their trademark registrations with CBP. You can investigate CBP records before importing goods from abroad.
Sue Chetlin is an Intellectual Property attorney with Burch and Cracchiolo, a proud Legacy Partner of Local First Arizona.