Lesson 8: Intellectual Property
What You’ll Learn: Ideas are currency in the world of business. From original works to cutting-edge inventions, you want to protect your work from theft, reverse engineering and dilution. Learn the ins and outs of copyrights, trademarks, patents and trade secrets and how to protect your intellectual property.
Intellectual Property (continued)
Patents
A patent protects an invention and grants its inventor exclusive rights as to its use. The idea of protecting intellectual property is so important to the economy that its protections were outlined in the U.S. Constitution: Congress shall have power… to promote the progress of science and useful arts, by securing for limited time to authors and inventors the exclusive right to their respective writings and discovery.
Patents are handled by the United States Patent and Trademark Office (USPTO). The most common patent, the utility patent, offers protection for 20 years from the date of filing but is not enforceable until the date the patent is actually issued. Design patents protect ornamental designs and plant patents offer protections to new varieties of reproducing plants.
A patent application is submitted to the patent office, which is reviewed by an examiner to determine whether or not it can be patented. If a patent is granted, the USPTO will give you the exclusive right to make, use and sell your intention in the United States. Some countries offer the same protection of a U.S. patent within their own borders; others do not.
A patent can be worth a fortune, but they are also expensive to pursue. A typical patent application can cost between $8,000 and $20,000 per patent. The actual application and review process is excruciatingly slow, taking two to three years to be granted. The market can change tremendously in that amount of time, and thousands of inventions have become irrelevant while the patent application is still under review. For small companies, this can be a significant barrier, but it is the only way you can legally protect a product or service you invent.
Trademarks
Before we dive into trademarks, let’s clear up some confusion. The terms “trade name” and “trademark” sound similar but they are very different. A trade name is the company’s official name, the one you registered with the state. It is commonly known as a DBA, “Doing Business As.” A trade name in and of itself does not provide you with any legal protection or exclusive rights of usage.
A trademark, on the other hand, does offer legal protection. Think Coca Cola. It is the name of the company and the name of one of its soft drinks. If you were to name a product or service Coca Cola or Coke, you would receive a very curt cease and desist letter from Coke’s legal department, since it is a registered trademark. A registered trademark has a ® symbol behind it. If the trademark is not officially registered and approved by the USPTO, it has a ™ instead. Unregistered service marks have an ℠ after it.
Digital Print Version
To make things a bit more confusing, companies, products and services may have the same name from time to time. For instance, there’s Pandora, the jewelry company, and Pandora, the music streaming service. This may seem to contradict the Coke example, but these two entities are in vastly different industries, so there’s no cause to believe a consumer would confuse one with the other when making a purchasing decision.
Having a registered trademark from the federal government offers you protections that a state-level registration cannot. It allows you to bring legal action against another company that is using your registered mark. For instance, if you discover a business is using your federal registered mark in another state, you can send them a cease and desist letter or file legal action against them.
A trademark can be registered by you or an intellectual property attorney. Some companies offer this service as well. You can do an initial search in TESS, the Trademark Electronic Search System.
So, what can be trademarked?
Letters and words, logos, pictures, combinations of words and logos, slogans, colors, product shapes and sounds can be all be trademarked. For example, the distinctive pink of Owens-Corning’s insulation is trademarked as is the three-tone chime of NBC.
There are trademark rights that are also common law, existing beyond those protected in statute. This provides you some protection of your mark within your own state’s borders, even if someone else had it registered in another state. Unless they had a federal registration, of course.
Because a federally registered trademark is national in scope, it has certain benefits, including the ability to recover damages for infringement as well as attorney fees. You are granted the right to use the ® symbol, clearly demonstrating ownership and ease of discovery in searches, preventing others from using similar marks.