1. Chapter 6 Intellectual Property See My Pointers (Local Access only)

2. Chapter 6 - Intellectual Property
Chapter 6 - Objectives
Define intellectual property.
Discuss copyrights, patents, and trade secrets.
Define reverse engineering.
Summarize the purpose of the Uniform Computer Information Transactions Act.
Distinguish competitive intelligence from industrial espionage.
Outline a strategy to protect your organization from cybersquatting.
Chapter 6 - Intellectual Property

3. Intellectual Property
Intellectual property includes works of the mind such as art, books, films, formulae, inventions, music, and processes that are distinctive and that are “owned” or created by a single entity.
Copyrights, patents, and trade secrets are used to protect intellectual property.
Chapter 6 - Intellectual Property

4. Chapter 6 - Intellectual Property
Copyright
A copyright is a form of protection provided by law that grants the authors of “original works of authorship in any tangible medium of expression, now known or later developed, from which they can be perceived, reproduced, or otherwise communicated, either directly or with the aid of machine or device, the exclusive right to distribute, display, perform, or reproduce the work in copies or to prepare derivative works base upon the work.”
1976 Copyright Act prevents others from reproducing the work for the authors life plus 70 years.
Chapter 6 - Intellectual Property

5. Chapter 6 - Intellectual Property
Fair Use Doctrine
Four factors to determine whether a copyright is a fair use:
The purpose and character of the use (e.g., is the use for commercial or nonprofit, educational purposes)
The nature of the copyrighted work
The portion of the copyrighted work used
The effect of the use upon the value of the copyrighted work
Fair Dealing – Wikipedia
Chapter 6 - Intellectual Property

6. Software Copyright Protection
Software copyright is “tricky”.
To prove infringement, the copyright holder must show a resemblance that could only be explained by copying.
Developing a software package without prior knowledge is difficult to prove or disprove.
Chapter 6 - Intellectual Property

7. Digital Millennium Copyright Act
November 1998
To comply with the global copyright protection treaty from the World Intellectual Property Organization - Part of the United Nations.
Penalties of 5 years in prison and/or fines of up to $500,000.
Chapter 6 - Intellectual Property

8. Chapter 6 - Intellectual Property
Legal Overview - DeCSS
Content Scramble System (CSS) is an encryption-based security and authentication system used in DVDs.
DeCSS software breaks the encoding system used in digital video disks.
In 2000, eight movie studios sued 2600:” The Hacker Quarterly for posting the DeCSS program.
Chapter 6 - Intellectual Property

9. Legal Overview – DeCSS (contd.)
The Motion Picture Association of America filed injunctions to block the Internet distribution of DeCSS software.
Courts ruled that unauthorized reverse engineering of the DVD system violated copyright and trade secret laws.
Chapter 6 - Intellectual Property

10. Chapter 6 - Intellectual Property
Patents
A patent enables the inventor to take legal action against those who, without the inventor’s permission, manufacture, use or sell the invention during the period of time the patent is in force.
The United States Patent and Trademark Office reviews patent applications and issues patents to approved inventions.
Patents in Canada
Chapter 6 - Intellectual Property

11. Chapter 6 - Intellectual Property
Patented Invention
It must fall into one of five statutory classes of things that can be patented.
It must be useful.
It must be novel.
It must not be obvious to a person having ordinary skill in the art to which said subject matter pertains.
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12. Chapter 6 - Intellectual Property
No Patent Protection
The U.S. Supreme Court has ruled that there are three categories of subject matter for which one may not obtain patent protection:
Abstract ideas
Laws of nature
Natural phenomena
Chapter 6 - Intellectual Property

13. Chapter 6 - Intellectual Property
Software Patents
Since the 1980s, the USPTO has granted a large number of software-related patents. Examples include:
Applications and business software
Compilation and system software
Edit, control, and operating system software
Software patents – Canada
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14. Chapter 6 - Intellectual Property
Trade Secrets
The UTSA defines a trade secret as “information, including a formula, pattern, compilation, program, device, method, technique, or process that:
Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by persons who can obtain economic value from its disclosure or use
Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy
Trade Secrets – Canada
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15. Chapter 6 - Intellectual Property
Trade Secret
To qualify as a trade secret, the secret must have
Economic value
Must not be readily ascertainable
The trade secret owner must take steps to maintain its secrecy
Chapter 6 - Intellectual Property

16. Advantages of Trade Secrets
No time limitations on the protection of trade secrets
No need to file an application, make any disclosures, or otherwise disclose a trade secret to outsiders
Patents are frequently ruled invalid by courts, meaning that the then-disclosed invention no longer has protection
Chapter 6 - Intellectual Property

17. Nondisclosure & Non-compete
A nondisclosure clause requires employees to refrain from revealing secrets that they learn at work.
A non-compete agreement requires employees to not work for any competitors for a set period of time.
Chapter 6 - Intellectual Property

18. Intellectual Property Issues
Reverse engineering is the process of breaking something down in order to understand it, build a copy of it, or improve it.
A compiler is a language translator that converts computer program statements into machine language that a computer can execute.
A decompiler is a software tool that reverse reengineers a software application.
Chapter 6 - Intellectual Property

19. Intellectual Property Issues
In 1999 the National Commissioners on Uniform State Laws approved the Uniform Computer Information Transactions Act.
The UCITA applies uniform legislation to software licensing issues.
Chapter 6 - Intellectual Property

20. Organizations That Support UCITA
Software and Information Industry Association
Information companies like Microsoft and AOL
Others (Caterpillar, Circuit City, insurance companies)
Chapter 6 - Intellectual Property

21. Organizations That Oppose UCITA
Association for Computing Machinery
Computer and Communications Industry Association
Computer Professionals for Social Responsibility
Digital Future Coalition
Electronic Frontier Foundation
International Communications Association
Society for Information Management
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22. Chapter 6 - Intellectual Property
UCITA
The UCITA defines a software license as a contract that grants permission to access or use information subject to conditions set forth in the license.
Shrink-wrap
Click-on
Active click wrap
Chapter 6 - Intellectual Property

23. Competitive Intelligence
The gathering of legally obtainable information that will help a company gain an advantage over its rivals.
Competitive intelligence is not industrial espionage.
Chapter 6 - Intellectual Property

24. Common Sources of Competitive Intelligence
Annual reports
Quarterly reports
Press releases
Promotional materials
Web site
Standard and Poor’s stock report
Dun & Bradstreet credit report
Interviews with suppliers, customers, former employees
Calls to customer service
Chapter 6 - Intellectual Property

25. Intellectual Property Issues
A trademark is anything that enables a consumer to differentiate one company’s products from another.
Trade Mark – Canada “A trade-mark is a name, symbol, or slogan which identifies or distinguishes a business or a product from the businesses or products of others.”
Cybersquatters are people who register domain names to which they have no connection in the hope of profiting from the legitimate trademark owner.
Chapter 6 - Intellectual Property

26. Chapter 6 - Intellectual Property
Summary
Intellectual property refers to works of the mind such as art, books, films, formulae, inventions, music, and processes.
Copyrights, patents, and trade secrets provide a complex body of law regarding the ownership of intellectual property.
Reverse engineering provides a means to gain access to information that another organization may have copyrighted or classified as a trade secret.
Chapter 6 - Intellectual Property

27. Intellectual Property Issues
A decompiler is a software tool that reverse reengineers a software application.
The 1998 Digital Millennium Copyright Act explicitly outlaws technology that can defeat copyright protection devices, but permits reverse engineering encryption, interoperability, and computer security research.
Chapter 6 - Intellectual Property

28. Chapter 6 - Intellectual Property
Summary
The UCITA is a controversial act that would apply uniform legislation to software licensing issues.
Competitive intelligence is not industrial espionage.
To avoid cybersquatting problems, organizations register their trademarks as soon as they know them.
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29. Chapter 6 - Intellectual Property
Case 1- Napster
Napster is a Web-based service founded in 1999 by Shawn Fanning. The goal is to provide music enthusiasts with an easy-to-use service for discovering and down loading music. The recording industry strongly objected to Napster.
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30. Chapter 6 - Intellectual Property
Case 2 - Lotus v. Borland
The Lotus v. Borland lawsuit lasted over five years going all the way to the Supreme Court and set a precedent that clarified the limits of software copyright protection. The case dealt with the “look and feel” of software.
Chapter 6 - Intellectual Property