Intellectual Property Overview

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"Intellectual property" refers to the set of rights granted to intangible creations of the mind.  In plain English, this means that certain ideas, creations, works of authorship, inventions, and meaningful symbols can be controlled exclusively by the person/company that owns them.  There are three primary forms of intellectual property: copyrights, trademarks, and patents. There are other forms of intellectual properties, such as trade secrets, which protect business methods or data so long as they are kept confidential.  However, trade secrets and other forms of intellectual property are less common, and have rights that vary state by state.

Not all businesses own inventions that can be registered as a patent.  By contrast, copyrights and trademarks exist regardless of registration, and virtually all businesses own copyrights and trademarks, even if the owners do not realize that fact.  That said, it is only those copyrights, trademarks and patents that hold potential value that should be protected.  Otherwise, the costs of protection may not be justifiable.

Here is a brief summary of these different types of intellectual property:

Copyrights exist in anything that required a modicum of creativity to create, as long as that something was stored in a way that is was not transient.  For instance, an artist who sketches a portrait in a sketch-pad has just created a copyrighted work.  Or, the computer programmer who types in code and saves it to disk has also created a copyrighted work.  These rights exist as of the moment they are created and stored, even without registering them.  However, registration enhances rights that might not otherwise exists in those copyrighted works.

Patents exist only if they are federally registered.  In order to become registered, the thing being patented (any new, useful and non-obvious invention, method, process or idea) must not have been shown in public for more than one year prior to the application date.  Thus, prototyping must be done in secret, or within the one year period. The rights you get with patents are defined by the writings contained within the patent application itself.  Thus, poor drafting of an application can be harmful or even disastrous.

Trademarks are any "thing" that helps consumers identify and distinguish one company's products from another company's.  Trademarks and brands are essentially synonymous concepts.  If anything such as color, sound, designs, words, etc. are used by a company to help distinguish themselves in the marketplace, that thing may become a trademark. See our companion site, TrademarkEdge.com for extensive information about trademarks. 

Trade secrets only exist if you take sufficient steps to keep them confidential. Some trade secrets may be patented.  However, trade secret protection is lost when you register a trade secret as a patent.  That is because trade secrets cease being secret upon registration as a patent, because all patents are published.  Thus, not all patentable ideas should be patented.  The advice of a reputable patent attorney should be sought if you believe you may have a patent. 

Chart: Comparing copyrights, trademarks and patents

Protection for intellectual property typically means: (1) clearing the property to make sure nobody else is using it before you start using it; and (2) takings steps to ensure the strongest possible rights in the intellectual property.  Below, these two phases of protection are considered in reference to the specific types of intellectual property.

Copyrights
It is not necessary to conduct clearance on copyrighted works, unless you were not the author/creator of the work.  If you independently created the work without copying, then no clearance is needed, because, unlike with patents and trademarks, it is a complete defense to copyright infringement to independently create a work, even if you coincidentally create a work that looks identical to a prior work.

However, if you have copied all or part of a work created by someone else, then you either need to determine that the work is in the public domain, or else you need to obtain permission to use that work.  A work is in the public domain if enough time has elapsed from the time the work was created or published so that the copyright protection has expired.  Determining these expiration dates is one of the most complex and frustrating jobs a copyright attorney does.  It is not recommended for trying at home.  However, sometimes, it is obvious that a work is in the public domain, such as when the author declares it to be in the public domain, which some authors do even if they don't have to.

In order to protect your own copyrights, you should register them with the Copyright Office.  The fees are relatively inexpensive if you do them yourself.  The rewards can be huge.  Most notably, you have built in leverage to stop an infringer.  If you're copyrights are not registered, you may have trouble getting a copyright infringer to stop infringing promptly if the ostensible economic consequences are minimal, which is often the case unless you register.  By registering, you have built-in damage awards, and the possibility of getting your attorneys fees paid for.

The process for registration is spelled out on Copyright Office web site.  Typically, you wouldn't need an attorney to register copyrights.  The forms and instructions are all available on the site.  However, there are a couple traps for the uninitiated.  You need to carefully read all the information and regulations on the website before attempting this on your own.  Odds are, if you register on your own without the aid of an attorney, you will probably do it as well as the attorney.  But, if the value of the copyrights warrants maximum protection, then it is not worth being penny wise on attorneys fees for help with registration.
 

Trademarks
It is recommended that every business engage in some form of clearance when it comes to their business names and other trademarks they might be using.  How much money and time a business invests in this process is very dependent on the size and resources of the business, and whether the trademark will be relied upon heavily in the future, such as for franchising or licensing.  Minimally, every business should engage in some limited searching over the internet on various search engines, and also at the US Trademark Office website.  While there is no law stating, "thou shalt conduct a trademark search," the reality is that if you don't do so, you risk not only loosing your investments in marketing your own name, but you could face liability for trademark infringement.

For example, if the name you've chosen for your business is "WildRoast Coffee" and there already exists a coffee shop such as the www.WildeRoastCafe.com, then you may have a problem.  To better ascertain whether you have a problem, you may want to obtain a legal opinion.  The attorney will help you determine whether the two trademarks were sufficiently similar, whether the products offered and channels of distribution were sufficiently related, whether the two companies were sufficiently proximate to one another, and whether other factors would cause confusion between the marks.  For more information about trademarks generally, visit our sister site at:  www.TrademarkEdge.com. 

Unlike with copyright owners, trademark owners can enforce their rights against those who have independently arrived at a identical or even similar ideas or trademarks.  Thus, there is no defense available for infringing patents or trademarks based on not knowing better, or not intending to copy.  Increasingly often, courts are holding companies liable if they turn a blind eye to prior uses of their trademark. While this particular liability has thus far been reserved for large companies, courts could easily shift this precedent toward smaller companies, particularly in light of the easy access to searching over the internet.

The search you need to conduct will depend on your case.  There is virtually no limit to the amount of money you could spend in conducting an exhaustive trademark searches. However, most small startup companies find that searching existing and pending State & Federal registered trademarks together with common law marks provides a reasonable balance between risk reduction and expenditures. Of course, If you are less risk tolerant, and have the extra cash, you may prefer to supplement the standard search in various ways that may be appropriate for your particular situation.

Trademark registrations can be applied for online without an attorney.  However, unlike with copyright applications, trademark applications are riddled with pitfalls for the unwary.  As with any legal work, however, while you don't want to be penny wise and pound foolish, circumstances may justify not hiring an attorney, and registering on your own.  This would be the case where you wanted some protection, but simply didn't have the extra money for an attorney, or where the trademark is temporary and not intended to be particularly valuable.  You can always hire an attorney later and if your application is too narrowly worded, or has poor specimens, or is not in all the classes is should be, then you can add a new application when money is more plentiful.  Of course, having an attorney advise you from beginning to end about your trademarks would be best, if money isn't an issue.

Protecting trademarks includes not only registering them, but also monitoring the use of identical or even similar marks used by others, and stopping infringers by enforcing your trademark rights.  Monitoring is much like clearance searching, but done on periodic intervals after the initial clearance. Enforcement of your trademark can be as simple as sending a "cease and desist" letter warning the other party to stop using your trademarks.  Or, enforcement may mean you have to sue infringers.   Failure to enforce your rights against infringers will not only whittle away at the strength of the mark, but is some instances may cause you to abandon your rights in the mark altogether.

Patents 
Not every business uses or creates patents.  In fact, very few do.  However, if your business is the type that relies on the use of patentable inventions, then you should work closely with an attorney to determine whether your invention will infringe a prior patent.   

As with trademarks, a patent holder can sue for infringement, even if you didn't copy them, and even if you didn't know they existed.  The rules for patent clearance are similar to, but not identical to trademark clearance.  Even more so than with trademark searching and analysis, you need to rely on legal advisors to help you determine whether you are infringing a prior invention. 

More than any of the intellectual property categories, patent registration requires specialized legal experience.  While there are do-it-yourself books on patenting your own inventions, the pitfalls are too great and too frequent to be advisable.  If you don't have the money to hire a patent attorney, find one who will do the patent in exchange for an interest in the business. 

For more information about patents, see www.bitlaw.com

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