Chapter 12 Intellectual Property McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.

Intellectual Property (Definition): Property that is the result of one’s intellectual and creative efforts, rather than physical efforts; includes marks (trademarks and service marks), copyrights, patents, and trade secrets 12-2

Mark A distinctive mark, word, design, picture, or arrangement used by producer in conjunction with a product, and that tends to cause consumer to identify product with producer A distinctive mark, word, design, picture, or arrangement used by producer in conjunction with a product, and that tends to cause consumer to identify product with producer Mark must be registered with U.S. Patent and Trademark Office; mark must be renewed between fifth and sixth years, and after initial renewal, every 10 years Mark must be registered with U.S. Patent and Trademark Office; mark must be renewed between fifth and sixth years, and after initial renewal, every 10 years Remedies for mark infringement: Remedies for mark infringement: Money Damages Money Damages Injunction Injunction Trademarks used in interstate commerce protected under Lanham Act Trademarks used in interstate commerce protected under Lanham Act 12-3

Types of Marks Service Mark: Mark used in conjunction with a service Service Mark: Mark used in conjunction with a service Product Trademark: Mark affixed to a good, its packaging, or its labeling Product Trademark: Mark affixed to a good, its packaging, or its labeling Collective Mark: Mark identifying producers as belonging to a larger group (Example: trade union) Collective Mark: Mark identifying producers as belonging to a larger group (Example: trade union) Certification Mark: mark licensed by a group (Examples: “U.L. Tested” and “Good Housekeeping”) Certification Mark: mark licensed by a group (Examples: “U.L. Tested” and “Good Housekeeping”) 12-4

Copyright Protects the fixed form of the expression of an original, creative idea Protects the fixed form of the expression of an original, creative idea Examples of copyrighted material include books, periodicals, musical compositions, plays, motion pictures, sound recordings, lectures, works of art, and computer programs Examples of copyrighted material include books, periodicals, musical compositions, plays, motion pictures, sound recordings, lectures, works of art, and computer programs Length of protection—Life of creator plus 70 years Length of protection—Life of creator plus 70 years Remedies for copyright infringement: Remedies for copyright infringement: Money Damages Money Damages Injunction Injunction “Fair Use”--Most common defense against copyright infringement “Fair Use”--Most common defense against copyright infringement Provides that a portion of copyrighted work may be reproduced for purposes of reporting, teaching, scholarship, and research Provides that a portion of copyrighted work may be reproduced for purposes of reporting, teaching, scholarship, and research 12-5

“Fair Use” Factors Purpose and character of use, including whether use is of a commercial nature or for nonprofit educational purposes Purpose and character of use, including whether use is of a commercial nature or for nonprofit educational purposes Nature of the copyrighted work Nature of the copyrighted work Amount and substantiality of portion used in relation to copyrighted work as a whole Amount and substantiality of portion used in relation to copyrighted work as a whole Effect of use on potential market for or value of copyrighted work Effect of use on potential market for or value of copyrighted work 12-6

Patent Protects a “product, process, invention, machine, or plant” that is “novel, useful, and non-obvious” Protects a “product, process, invention, machine, or plant” that is “novel, useful, and non-obvious” Length of protection: 20 years Length of protection: 20 years Remedies for patent infringement: Remedies for patent infringement: Money Damages Money Damages Injunction Injunction Lanham Act—allows patent holder to license use of idea for royalties, provided that holder does not enter into “tying arrangement” or engage in “cross-licensing” Lanham Act—allows patent holder to license use of idea for royalties, provided that holder does not enter into “tying arrangement” or engage in “cross-licensing” 12-7

Trade Secret Alternative to patent protection Alternative to patent protection Remedies for trade secret infringement: Remedies for trade secret infringement: Money Damages Money Damages Injunction Injunction Allows holder to sue for violation, if owner can prove: Allows holder to sue for violation, if owner can prove: Trade secret existed Trade secret existed Defendant acquired trade secret through unlawful means Defendant acquired trade secret through unlawful means Defendant used trade secret without plaintiff’s permission Defendant used trade secret without plaintiff’s permission 12-8

International Protection of Intellectual Property The Berne Convention of 1886 The Berne Convention of 1886 The Universal Copyright Convention of 1952 The Universal Copyright Convention of 1952 (Revised 1971) (Revised 1971) The Paris Convention of 1883 The Paris Convention of 1883 The 1994 Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPP) The 1994 Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPP) 12-9