Chapter 7 Intellectual Property and Cyber Piracy

Introduction to Intellectual Property and Cyber Piracy Federal law provides protections for intellectual property rights by means of: Patents Copyrights Trademarks 7-2 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trade Secret Trade secrets Product formula Pattern Design Compilation of data Customer list or other business secret Uniform Trade Secrets Act: Gives statutory protection to trade secrets 7-3 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trade Secret Lawsuits for misappropriation – brought against anyone who steals a trade secret Defendant must have obtained the trade secret through unlawful means Discovery of trade secret by reverse engineering is lawful A trade secret unprotected by the owner is not subject to legal protection 7-4 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trade Secret Civil Trade Secret Law: Misappropriation of a trade secret A successful civil plaintiff can: Recover profits made by offender Recover damages Obtain injunction prohibiting offender from divulging trade secret 7-5 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trade Secret Economic Espionage Act Makes it a federal crime for any person: To convert a trade secret to his or her benefit or for the benefit of others Performing the above knowing or intending that the act would cause injury to the owner of the trade secret Includes computer espionage Severe criminal penalties 7-6 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Patent A grant by the federal government upon the inventor of an invention for the exclusive right to use, sell, or license the invention for a limited amount of time Intended to provide incentive for inventors to make their inventions public Protects patented inventions from infringement Federal patent law is exclusive; no state patent laws 7-7 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Patent Subject matter that can be patented Machines Processes Compositions of matter Improvements to existing machines, processes, or compositions of matter Designs for an article of manufacture Asexually reproduced plants Living material invented by a person 7-8 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Patent Requirements for obtaining a patent An invention must be: Novel Useful Nonobvious Abstractions and scientific principles cannot be patented unless they are part of the tangible environment 7-9 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Case 7.1: U.S. Supreme Court Patent Bilski v. Kappos, Director, Patent and Trademark Office 130 S.Ct. 3218, 177 L.Ed.2d 792, Web 2010 U.S. Lexis 5521 (2010) Supreme Court of the United States Issue Is the petitioners’ claimed invention patentable? 7-10 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Patent Patent period Utility patents – twenty years Design patents – fourteen years Patent term begins to run from the date the patent application is filed The U.S. follows “first-to-invent” rule The invention or design enters the public domain after patent period expires 7-11 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Patent One-year “on sale” doctrine Public use doctrine Patents will not be granted if an invention was in the public domain for one year prior to application filing 7-12 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Patent Provisional patent application Filed by the inventor to obtain three months to prepare a final patent application American Inventors Protection Act provides provisional patent application 7-13 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Patent Patent infringement Occurs when someone makes unauthorized use of a patent Plaintiff may recover: Money damages equal to royalty rate Other damages caused by the infringement Order for destruction of infringing items Injunction against infringer Treble damages for intentional infringement 7-14 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Copyright Revision Act of 1976 Establishes the requirements for obtaining a copyright Protects copyrighted works from infringement Only tangible writings are subject to copyright registration and protection Federal copyright law is exclusive Copyright can be sold or licensed to others 7-15 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Registration of copyrights Must be an original work Registered with U.S. Copyright Office Registration Permissive Voluntary Done at any time during term of copyright Registration permits a holder to obtain statutory damages for copyright infringement Not required to use © or word “copyright” 7-16 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Copyright period Sonny Bono Copyright Term Extension Act Individuals are granted copyright protection for their lifetime plus seventy years Copyrights owned by businesses are protected for the shorter of either: 120 years from the year of creation 95 years from the year of first publication 7-17 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Copyright infringement Occurs when a party copies a substantial and material part of the plaintiff’s copyrighted work without permission Successful plaintiff may recover: Profit made by the defendant from the infringement Damages suffered by the plaintiff Order requiring impoundment and destruction Injunction preventing future infringement 7-18 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Fair use doctrine Permits certain limited unauthorized use of copyrighted materials No electronic theft act Makes it a crime for a person to willfully infringe on a copyright Digital Millennium Copyright Act Makes it a crime to circumvent encryption technology 7-19 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trademark Used to identify and distinguish goods of a manufacturer or seller or services of a provider from others Trade name Symbol Word Logo Design Device 7-20 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trademark Lanham (Trademark) Act Protects the owner’s investment and goodwill in a mark Prevents consumers from being confused as to the origin of goods and services 7-21 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trademark Registration of a mark Mark may be registered if it has been used in commerce Can be registered six months prior to use Mark is lost if not used within six months Mark may be opposed by third parties The use of the symbol ® is not mandatory 7-22 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trademark Types of marks Trademark Service Mark Certification mark Collective membership mark 7-23 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trademark Marks that cannot be registered Flag or coat of arms of the United States, any state, municipality, or foreign nation Marks that are immoral or scandalous Geographical names standing alone Surnames standing alone Any mark that resembles a mark already registered with the U.S. PTO 7-24 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trademark Distinctiveness or secondary meaning A mark must be distinctive A unique word or design Have acquired a secondary meaning An ordinary term becomes a brand name 7-25 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trademark Trademark infringement: Unauthorized use of a trademark Owner must prove that: Defendant infringed the plaintiff’s mark by using it in an unauthorized manner Use is likely to cause confusion, mistake, or deception 7-26 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Case 7.2: Trademark Infringement Intel Corporation v. Intelsys Software, LLC Web 2009 U.S. Dist. Lexis 14761 (2009) United States District Court for the Northern District of California Issue Is there trademark infringement that warrants the issuance of a permanent injunction against Intelsys? 7-27 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trademark Generic names Term for a mark that has become a common term for a product line or type of service and therefore has lost its trademark protection Name becomes descriptive rather than distinctive 7-28 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trademark Diluting, blurring, or tarnishing trademarks Federal Dilution Act of 1995 Protects famous marks from dilution Use by other party is actionable if: It is commercial It causes dilution of distinctive quality of mark Types of dilution Blurring Tarnishment 7-29 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. Trademark Trademark Dilution Revision Act A dilution plaintiff does not need to show that it has suffered actual harm It only needs to show that there would be the likelihood of dilution 7-30 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Case 7.3: Dilution of a Trademark V Secret Catalogue, Inc. and Victoria’s Secret Stores, Inc. v. Moseley 605 F.3d 382, Web 2010 U.S. App. Lexis 10150 (2010) United States Court of Appeals for the Sixth Circuit 7-31 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Case 7.3: Dilution of a Trademark Issue Is there tarnishment of the Victoria’s Secret senior mark by the Moseleys’ use of the junior marks Victor’s Secret and Victor’s Little Secret? 7-32 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.

Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall. 7-33 Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall.