Chapter 4Patents, Trademarks and
Trade Secrets
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Trademarks, Servicemarks
• Word, name, symbol or device• Used in trade with goods to indicate the source of
the goods (or service) and to distinguish them from the goods of others• Goal- consumer protection
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Trademarks, Servicemarks
• Mixture of:• Lanham Act of 1945• Madrid System• US Anti-Dilution Act• State Law
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Registration
• Ownership arises from use, not registration, but…• Registration has benefits• Public record of claim• Proof of ownership• Invocation of federal jurisdiction• Basis for foreign registration• Customs prevent importation
• IZOD alligator, gray market goods
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Search
• TESS• Trademark Electronic Search System• Not current, not all inclusive
• WHO IS• AllWhoIs
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Loss of Trademark
• Abandonment-Failure to use trademark• Enter common usage, public domain• Dry Ice, Corn Flakes, Zipper
• Trademark owners must promote use of trademark as adjective, not noun• Benefits Advertising Industry
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International Trademarks
• Nike conflict in Spain• European Community registration• Madrid System- international• One global application
• Madrid Agreement• Madrid Protocol-• Single application valid for 10 years
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Symbols
• TM -Trademark, not federally registered• ® - Trademark, federally registered
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Trademark Infringement
• Test- likely to cause confusion
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Trademark Dilution
• Requires• Commercial use• Famous mark• Causes dilution of the distinctive quality
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Trademark Blurring
• Famous trademark used on noncompeting goods• Smith & Wesson toasters
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Trademark Tarnishment
• Ridiculing mark’s distinctive quality• Hormel vs Muppets over SPAM or Spa’am
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Trademark Parody
• Conveying two simultaneous contradictory messages• PETA-People for the Ethical Treatment of Animals• PETA-People Eating Tasty Animals• Not a parody• Google vs Booble
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Patent
• Government grant• Monopoly rights• Exclude others from making, using, offering for sale
or selling invention for a period of 20 years from the filing date
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Patent
• Like Copyright, Patent cannot cover idea• Not a law of nature• Not a physical phenomena• Must be invention
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Inventions-Utility Patent
• Process• Machine• Manufacture• Composition of matter• Improvements on above
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Patent vs Trade Secret
• Patent-full disclosure of invention in return for 20 year monopoly-federal law• Trade Secret-secret, no disclosure required, infinite
life-state law
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Patent Value-Licensing!
• Exclusive license-to one licensee• Nonexclusive license- to multiple licensees• Limited use license• Cross licensing-create a cartel
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Patent Types
• Utility patent-most common, inventions• Design patent-appearance of object• Plant patent-appearance and color
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Utility Patent Requirements
• Novel• Non-obvious• Useful
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Utility Patent Application
• Filing application required, not optional• Prior art search• Patent Attorney-specialist• Process is expensive and time consuming• Patent Litigation is extremely expensive
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Utility Patent Application Sections• Petition• Abstract• Specification• Claims• Drawings• And strict time limits!
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Internet & Patents
• Protect software-.gif files• Protect business methodology- Amazon ‘One-click’
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Business Methods Criticism
• Not ‘Novel’• Not ‘Non-obvious’
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Patent Infringement
• Compare patent claims to infringing product• All claim elements must be present in product• Patent presumed valid (court assumes examiners
competent), therefore infringer must proved patent invalid• Threat of litigation expensive, use patents as shield
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International Patents
• World Intellectual Property Organization (WIPO)• Based on Paris Convention of 1883• One year filing deadline for intl
• Patent Cooperation Treaty of 1970• One intl patent application
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Trade Secrets
• Business Practices• Methods• Processes• Designs
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Trade Secret Elements
• Not generally publicly known• Information secrecy confers economic benefit• Secrecy maintained by reasonable efforts
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Trade Secret Law
• State Law-except Economic Espionage• Varies by Jurisdiction• Model statute-Uniform Trade Secrets Act• 45 states adopted
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Trade Secret Examples
• Google Search code• Supplier lists
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Misappropriation
• Independent research or reverse-engineering is allowed• Remedies• Injunction• Lost profits• Royalties
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Economic Espionage Act of 1996• Misappropriation or theft of trade secrets• Federal offense• Fines up to $5 million• Jail terms up to 10 years• Apple sues Ciarelli over leaks