© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C HAPTER 5 I NTELLECTUAL P ROPERTY AND I NTERNET L AW

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. L EARNING O BJECTIVES  What is intellectual property?  Why is the protection of trademarks important?  How does the law protect patents?  What laws protect authors’ rights in the works they create?  2

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. L EARNING O BJECTIVES  What are trade secrets, and what laws offer protection for this form of intellectual property? 3

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. I NTRODUCTION  Intellectual Property (I.P.) is any property that is the product of an individual’s mind, e.g., books, software, movies, music.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. I NTRODUCTION  U.S. Constitution protects I.P. in Article I Section 8. Congress shall: “promote the Progress of Science and useful Arts, by securing for limited times to Authors and Inventors the exclusive right to their respective Writings and Discoveries.”  Ownership of I.P. is strategically important in the global economy.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. T RADEMARKS AND R ELATED P ROPERTY  Trademark. Distinctive motto, mark or emblem. Stamped or affixed to a product. So that it can be identified in the market. CASE 5.1 The Coca-Cola Co. v. Koke Co. of America (1920). How were the names confusing to the public?

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. T RADEMARKS AND R ELATED P ROPERTY  Statutory Protection for Trademarks. Lanham Act of 1946 provides federal protection of manufacturers from losing business to rivals that used confusingly similar brands and products.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. T RADEMARKS AND R ELATED P ROPERTY  Trademark Dilution Act of Amended Lanham Act to bring federal cause of action in federal court for trademark dilution –even when mark is unlikely to confuse. “Similar” marks may give rise to dilution suit.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. T RADEMARKS AND R ELATED P ROPERTY  Trademark Registration. U.S. Patent and Trademark Office gives notice to 3 rd parties. A mark can be registered if in use or mark will be used within 6 months.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. T RADEMARKS AND R ELATED P ROPERTY  Trademark Infringement. Unintentional or intentional substantial copying of mark.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. T RADEMARKS AND R ELATED P ROPERTY  Distinctiveness of Mark. Strong Marks: fanciful, arbitrary, or suggestive trademarks are most distinctive marks, normally not related to product (Apple, Xerox, Starbucks). Suggestive Trademarks: bring something to mind without describing the product directly. 

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. T RADEMARKS AND R ELATED P ROPERTY  Distinctiveness of Mark. Secondary Meaning: descriptive, geographical, or personal names do not acquire protection until consumers associate term with product (London Fog). Generic Terms: no protection (bicycle, computer).

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. T RADEMARKS AND R ELATED P ROPERTY  Service, Certification, and Collective Marks. Service Mark: similar to trademark but used for services (includes TV and radio). Certification Mark: quality of goods (UL tested, Good Housekeeping). Collective Mark: used by members of a cooperative, association, union.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. T RADEMARKS AND R ELATED P ROPERTY  Trade Dress. Protects image and appearance of a product or store (Example: fish shape of cracker, Starbucks stores).

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. T RADEMARKS AND R ELATED P ROPERTY  Counterfeit Goods. Stop Counterfeiting in Manufactured Goods Act (2006) criminalizes intentional trafficking in counterfeit goods.  Trade Names. Indicates all or part of a business name that is protected (Example: Safeway).

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. T RADEMARKS AND R ELATED P ROPERTY  Licensing. Agreement that permits use of trademark, copyright, or patent in cyber space. Owner is licensor, user is licensee. Terms of the use are delineated in the license agreement.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C YBER M ARKS  Domain Names. Trademarks in Cyberspace (example: Nike.com). Conflicts—ICANN.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C YBER M ARKS  Anticybersquatting Legislation. Occurs when 3d party registers a domain name that is the same or similar to another company’s own trade name Anticybersquatting Consumer Protection Act.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C YBER M ARKS  Meta Tags. Keywords in web pages used by internet search engines. Playboy Enterprises, Inc. v. Welles (2002).

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C YBER M ARKS  Dilution in the Online World. Trademarks can be diluted on the web. CASE 5.2 Hasbro, Inc. v. International Entertainment Group, Ltd. (1996). Why did IEG violate Hasbro’s trademark “Candyland”?

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. P ATENTS  A patent is a government monopoly that gives inventor the exclusive right to make, use or sell and invention for 20 years.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. P ATENTS  Patent Databases. USPTO.gov EPO.org  What is Patentable? Item must be novel and not “obvious”. Almost anything is patentable (excluding laws of nature, natural phenomena, abstract ideas).

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. P ATENTS  Patent Infringement. Manufacture, use or sale of another’s product or design without permission (license). Patent Suits and High Tech Companies. Generally no infringement occurs under US law when a patented product is made and sold in another country. 

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. P ATENTS  Patent Infringement. Patent Suits and High Tech Companies. Apple, Inc. v. Samsung Electronics Company, filed suit with the International Trade Commission and a U.S. district court, alleging infringement of patents, trade dress, and trademarks.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. P ATENTS  Remedies for Patent Infringement. Injunction. Damages for royalties. Reimbursement for attorney’s fees and costs.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C OPYRIGHTS  A copyright is an intangible property right automatically granted by federal statute to the author for life plus 70 years.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C OPYRIGHTS  What is Protected Expression? Work must be original and “fixed in a durable medium.” Ideas are not protected, but the expression of an idea is. 

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C OPYRIGHTS  What is Protected Expression? Section 102 Exclusions. Should the Copyright Act preempt plaintiffs from brining “idea submission” claims under state law?  “Compilation of Facts” is protected.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C OPYRIGHTS  Copyright Infringement. Form or expression is copied (does not have to be in its entirety). Remedies: Penalties, damages and criminal action are possible. 

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C OPYRIGHTS  Copyright Infringement. The “Fair Use” Exception: certain persons or organization can copy materials without penalty (e.g., education, news, research). 

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C OPYRIGHTS  Copyright Infringement. The First Sale Doctrine: Section 109(a). Once a person buys or is given a copyrighted work, the original copyright holder loses control of distribution.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C OPYRIGHTS  Copyright Protection For Software. 1980: Computer Software Copyright Act, which includes computer programs. Includes: Computer language readable by humans. Binary language object code of programs. Structure, sequence, and organization. DOES NOT include “look and feel”.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C OPYRIGHTS  Copyrights in Digital Information. Generally, anytime a party downloads software or music without authorization, infringement occurs DMCA. Proposed SOPA, PIPA.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. C OPYRIGHTS  MP3 and File-Sharing Technology. File Sharing: P2P sharing, distributed network. What about “cloud computing”? Sharing Stored Music Files: liable for contributory and vicarious infringement. A&M v. Napster. MGM v. Grokster.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. T RADE S ECRETS  Trade secrets are confidential, not filed with the government.  Can be customer lists, formulas, pricing, etc.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. T RADE S ECRETS  Theft of trade secrets is now a federal crime under the Economic Espionage Act of  Theft Secrets in Cyberspace. Employees can easily information to competitors.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. I NTERNATIONAL P ROTECTION FOR I NTELLECTUAL P ROPERTY  Berne Convention (1886). CASE 5.3 Golan v. Holder (2012). Why did the U.S. Supreme Court affirm the appellate court?

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. I NTERNATIONAL P ROTECTION FOR I NTELLECTUAL P ROPERTY  TRIPS Agreement (1994). Each member must include domestic laws protecting intellectual property of other nation-members.

© 2014 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. I NTERNATIONAL P ROTECTION FOR I NTELLECTUAL P ROPERTY  Madrid Protocol (2003). U.S. company can submit a single application to register its trademark with all 73 member nations.