YOU DON'T HAVE TO BE A GENIUS TO OWN INTELLECTUAL PROPERTY

©2009 Leonard D. Messinger, Esq.

You don't have to be a genius to own intellectual property. If you are in business, you likely already own one or more forms of intellectual property.

What is intellectual property, how do you get it and, most importantly, how do you best protect and avoid losing it?

Intellectual property generally consists of "products of the mind" which may encompasses different types of property. Knowing about each can help in planning and running your business, protecting your reputation and assets, competing effectively in the marketplace and, often most importantly, avoiding lawsuits. Taking steps to maximize its protection can also maximize its value and avoid loss of important rights.

PATENTS are grants from the government to protect inventions. There are two basic types: utility patents and design patents. Utility patents typically cover apparatus (such as products and equipment), or processes (methods of making something, performing certain tasks or running equipment). Design patents protect and cover non‑functional design elements (that is, its overall appearance) of devices. A patent grants its owner the right to exclude others from making, using, importing, offering to sell or selling products or processes which include the patented invention. Patents, and the right to enforce them, are valid only after an application is filed and evaluated, and the patent is issued by the government. Although some exceptions exist, a patent is enforceable only for or in the country which issued it. A system, enabling patent applications to be filed in multiple countries, is available. Patents are valid for a specified time. In the U.S., a utility patent term is usually 20 years from the filing date. But, regardless of where a patent application is filed, care must be taken to avoid losing potential patent rights due to premature public disclosure of the claimed invention.

TRADEMARKS AND SERVICE MARKS are brand names and things used for products or services to indicate their source (for example, Kodak® film, Coca‑Cola® beverages, Orkin® pest control). Under certain circumstances, colors (like the pink color of fiberglass insulation) or sounds (one familiar example is the NBC chimes) can also qualify as a trademarks or service marks. Business owners can develop and obtain rights in trademarks and service marks without government registration, by using them on or for specified goods or services. Unlike patents, which require issuance of a formal grant, trademark and service mark rights may be obtained by use (called "common law rights"). Common law rights may be restricted to the particular geographic area in which they have been used. A government trademark or service mark registration, however, can provide significant additional protection and create beneficial legal presumptions. Such registrations have often been a deciding factor in settling disputes or in lawsuits over the right to use a trademark or a confusingly similar variation. And trademarks can be "forever": they can be enforced, and registrations renewed, as long as the owner uses or properly licenses use of the mark for the specified goods or services.

TRADE NAMES are company or business names. Whether your business is a sole proprietorship, partnership, joint venture, limited liability company or a multi‑national corporation, it must have a name. Unlike trademarks, trade names identify the business, not the product or service provided by your business. Trade names may consist of a "fictitious business name" or "dba" (doing business as) often used by sole proprietors and partnerships, or corporate names (XYZ Corporation, Inc.). Fictitious business names often must first be advertised and recorded with the County Clerk's office to enable businesses to open a checking account. Corporations must register their corporate names with the state (usually, the secretary of state) as part of the incorporation process.

Neither a trademark registration nor a trade name registration (nor incorporation) guarantees the exclusive right to use the registered name, but each may create certain procedural presumptions which can be used as a shield to defend attacks by others, or as a sword against infringers.

COPYRIGHTS protect works of authorship, such as artwork, written text, computer software, motion pictures, photographs, audio and other audio-visual material. Copyrights protect against unauthorized copying by others (unlike patents, trademarks, and trade names, which can be infringed without actually copying your works). But, protection is limited to only the particular manner in which the work of authorship is "expressed": copyrights do not protect ideas or concepts.

In the United States, copyrights are created when an original idea is expressed in a "tangible form" (e.g., sheet music, a recorded song, photograph, script, book or a recorded or written computer program). No registration is required! But, a federal copyright registration, issued by the Registrar of Copyrights in Washington, D.C. as the result of an application filed promptly after introduction of the property to the public, can provide significant additional rights and presumptions. These include, among others, the right to file a lawsuit for copyright infringement, the right to a certain type ("statutory") of damages for infringement, and the right to an attorney's fees award if you win your case. Failure to promptly apply for registration may result in the loss of some of these rights.

TRADE DRESS protects the unique or distinctive overall appearance of products and packaging and, in some cases, even premises (a restaurant's overall decor and design may be protectable as a trade dress). Trade dress may include format, design, layout, shape or color elements. But, the claimed elements making up the trade dress cannot contribute to functional aspects of the product or service, or be a feature which other competitors must have to compete in the marketplace. For example, although a bottle might be considered functional (because it functions to hold liquid), a uniquely shaped bottle may have protectable trade dress. The appearance of an item may also qualify for trademark registration, or if novel, for a design patent.

TRADE SECRETS consist of information, including items such as formulas, patterns, data compilations, programs, techniques, or processes which are valuable because they are not generally known to the public and not readily ascertainable by people who might use them. They can be as exotic as a complicated formula for a complex chemical, a manufacturing process for building intricate machines, or as simple as a recipe or customer list. Although there are no registrations or other governmental certificates for trade secrets, their owners must take affirmative steps to protect and reasonably maintain the secrecy of the information, or face forfeiture of their trade secret status.

Your business probably owns one or more of these intellectual properties. Here's an example: you design and sell computers. The company's name is a trade name. If the company modifies or invents new structures for computer hardware components or methods of making them, or develops the software to run them, it may be entitled to utility patent protection. If the appearance and shape of your computer is distinctive and does not make it operate better or more efficiently, that appearance may be protectable by a design patent or as a trade dress. The computer software, displays, brochures, packaging, and your television advertising for it, may all be subject to copyright protection. If you use your own brand name or trademark on or for your computer hardware or software, it may be eligible for trademark protection. Similarly, computer design, maintenance or even retailing services, advertised or offered under brand names, may qualify for service mark protection. Even your domain names, if used appropriately, may be protected and registered as service marks. Your customer list and lead list may be protectable as trade secrets. And, if your biggest competitor tells lies about you or your products, or otherwise makes false statements about your products or even its own computer systems, you may have a basis to sue it for unfair competition or misrepresentation as to the source or quality of goods.

So, you see, you need not be an intellectual to own intellectual property. But intellectual property may be the lifeblood of a business and a valuable business asset, both now, while the business is successful, and in the future if the business is offered for sale. A wise business owner will conduct periodic intellectual property audits and take reasonable steps to protect all intellectual property interests ‑ or face the possibility of losing them.

Leonard D. Messinger is an attorney in the Los Angeles intellectual property law firm of Fulwider Patton LLP.