7 The Importance of Intellectual Property
7 The Importance of Intellectual Property
Source: United States Patent and Trademark Office, Performance and Accountability Report for
Fiscal Year 2016, available at www.uspto.gov.
Patents
Three basic requirements for a patent
Types of Patents
Type Type of Invention Covered Duration
Utility New or useful process, machine, manufacture, 20 years from the date of the original
or composition of material or any new and application.
useful improvement thereof.
Design Invention of new, original, and ornamental 14 years from the date of the original
design for manufactured products. application.
Plant Any new varieties of plants that can be 20 years from the date of the original
reproduced asexually. application.
Business Method Patents (Special Utility Patent)
• A business method patent is a patent that protects an invention that is or
facilitates a method of doing business.
• The most notable business method patents that have been awarded:
• Amazon.com’s one-click ordering system.
• Priceline.com’s “name-your-price” business model.
The Process of Obtaining a Patent
Patent Infringement
• Takes place when one party engages in the unauthorized use of another
party’s patent.
• The tough part (particularly from a small entrepreneurial firm’s point of
view) is that patent infringement cases are costly to litigate.
• A typical patent infringement case costs each side at least $500,000
to litigate.
Trademarks
• A trademark is any word, name, symbol, or device used to identify the
source or origin of products or services and to distinguish those product or
services from others.
• Trademarks also provide consumers with useful information.
• For example, consumers know what to expect when they see a Macy’s
store.
• Think how confusing it would be if any retail store could use the name
Macy’s.
The Four Types of Trademarks
Type Types of Marks Covered Duration
Trademark Any word, name, symbol, or device used to identify and Renewable every 10 years, as long as the
distinguish one company’s goods from another’s. mark remains in use.
Examples: Apple, d.light, GoPro, Athletic Propulsion Labs,
3Derm
Service mark Similar to trademarks; are used to identify the services or Renewable every 10 years, as long as the
intangible activities of a business, rather than a business’s mark remains in use.
physical products.
Examples: 1-800-FLOWERS, Amazon.com, IndieU, Real Time
Cases, CoachUp, Dropbox
The Four Types of Trademarks
Type Types of Marks Covered Duration
Collective mark Trademarks or service marks used by the members of a Renewable every 10 years, as long as the
cooperative, association, or other collective group. mark remains in use.
Examples: Information Technology Industry Council,
International Franchise Association, Rotary International
Certification mark Marks, words, names, symbols, or devices used by a person Renewable every 10 years, as long as the
other than the owner to certify a particular quality about a mark remains in use.
good or service.
Examples: 100% Napa Valley, Florida Oranges, National
Organic Program, Underwriters Laboratories
What is Protected Under Trademark Law?
Item Example(s)
Descriptive marks Phrases like “golf ball” and “fried chicken” are
descriptive and can’t be trademarked
Pantomimes and choreographic Arrangements of dance movements, including ballets and mime works
works
Pictorial, graphic, and sculptural Photographs, prints, art reproductions, cartoons, maps, globes,
works jewelry, fabrics, games, technical drawings, diagrams, posters, toys,
sculptures, charts
Exclusions from Copyright Protection
The Idea-Expression Dichotomy
• The main exclusion is that copyright laws cannot protect ideas.
• For example, an entrepreneur may have the idea to open a football-
themed restaurant. The idea itself is not eligible for copyright
protection. However, if the entrepreneur writes down specifically
what his or her football-themed restaurant will look like and how it
will operate, that description is copyrightable.
• The legal principle describing this concept is called the idea-
expression dichotomy.
• An idea is not copyrightable, but the specific expression of an idea
is.
Obtaining a Copyright
How to Obtain a Copyright
• Copyright law protects any work of authorship the moment it assumes
a tangible form.
• Technically, it is not necessary to provide a copyright notice or register
work with the U.S. Copyright Office.
• The following steps can be taken, however, to enhance copyright
protection.
• Copyright protection can be enhanced by attaching the copyright
notice, or “copyright bug” © to something.
• Further protection can be obtained by registering the work with the
U.S. Copyright Office.
Copyright Infringement
Copyright Infringement
• Copyright infringement occurs when one work derives from another, is
an exact copy, or shows substantial similarity to the original work.
• To prove infringement, a copyright owner is required to show that the
alleged infringer had prior access to the copyrighted work and that the
work is substantially similar to the owner’s.
Copyright Infringement