Intellectual Property Issues

U.S. Constitutional Basis

Article 1, Section 8 – Congressional Powers: “to 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.”

Title 35 of the United States Code

“Bundle of Sticks” Theory

Ownership versus interest.
Protection of economic opportunity.

Intangible Property

Patents.
Copyrights.
Trademark.
Trade Secrets.
Reverse Engineering.
Goodwill.

Patents

Definition.
Holders of patents – individuals, however, individuals who are employees may execute an agreement to assign patent rights and split possible royalties.
Four Categories (all applied technology - invention must apply to only one):
- New and useful process.
- Machine.
- Manufacture or composition of matter.
- New and useful improvement of any one of A, B, or C above.
Four Requirements (invention must meet all 4 requirements):
- Novelty – unique in relation to the existing body of applied technology reasonable known in the field.
- Originality – applicant for patent must be the actual inventor/developer.
- Utility – invention must be of use or function to some one other than the inventor.
- Nonobviousness – invention would not have been contemplated by a person having ordinary skill in the art or field of invention.
Process to Obtain a Patent:
- Application with the United States Patent and Trademark Office.
- Requirements for application:
  - Completion of application form.
  - Submission of fee ($690 for domestic; $960 for international).
  - Detailed description of invention at level of skilled person in the relevant technical field.
  - Application must include arguments/rationale for invention’s meeting all four requirements of paragraph 4 above.
  - Description of how invention is made.
- Process of application (lengthy and costly):
  - Application is submitted to USPTO.
  - Upon receiving application, a USPTO examiner reviews it.
  - Examiner confirms requirements are met
  - Examiner conducts search to confirm novelty and nonobviousness.
  - Accepted Applications – examiner writes acceptance letter and patent becomes effective on the first date of invention.
  - Rejected Applications – examiner writes rejection letter. Applicant may appeal decision. If rejected again, applicant may appeal to Court of Appeals for the Federal Circuit in his/her district.
Duration of Patent – 20 years. May apply for extension of 16 years.
Infringement of Patent – refers to the unauthorized making, selling, or using of a patented invention. Proof includes:
- A patent exists on the invention.
- The inventor and person bringing suit is the patent holder.
- Alleged infringer has made, sold, or used the invention without authority from the patent holder.
- Patent holder is “harmed.”
Consequences of Infringement:
- Injunction – court order to preclude further use of patent.
- Fines – up to $100,000.
- Restitution of profits made by illegal use of patent.
- Legal fees.

Copyrights

Definition: - establishes ownership of original works of authorship fixed/expressed in any tangible medium of expression.
Holders of copyrights - individuals.
Categories

Reproduction.
Adaptation.
Public Distribution.
Public Performance.
Public Display.

Requirements – originality.
Process to Obtain

Expression of the work holds the © symbol.
Expression of the work is registered with the Copyright Office (not necessary).

Duration of Copyright –

Personal authorship – for the life of the author plus 50 years.
Authorship as part of employment - duration is for the life of the creator plus 70 years.
Copyrights created for an employer last 120 years from creation or 95 years from publication, which ever occurs sooner.

Infringement of Copyright – similar proof needed as with patents.
Fair Use of Copyrights –

Educational applications of partial works.
Non-economic related uses.
Uses of expression of the work from a factual work, published work, or out-of-print work.

Software Piracy

Definition – illegal copying of softwarMay include minor changes.
Considered a felony.
Fines of up to $250,000; incarceration of up to 5 years
Restitution.

Plagiarism

Illegal use of ideas, writings, drawings, words, or other expressions created by another but presented as one’s own.
Self-plagiarism.

Trade Secrets

Definition: - something that derives economic benefit to a commercial entity, for which common knowledge would detrimentally impact such benefit.
Holders of Trade Secrets – any individual or entity.
Categories – any apparatus, formula, or compilation of information of value in conducting a business.
Requirements - none.
Process – no specific process; however, in software industry, generally established by licensing agreements.
Duration - perpetuity.
Infringement –

Much harder to prove than with patents or copyrights.
Must prove existence of trade secret.
Must prove harm.
Must prove intent of information as a secret.

Reverse Engineering

Definition: obtaining an improved level of general understanding/knowledge of a product by taking it apart and becoming familiar with how it works.
Infringement issues – considered infringement.

“Look and Feel” Copyright Controversy

Definition: protection against unauthorized use of a form of a product (versus its content).

Recent Cases/Legal Issues

SPAM Laws

Ferguson v. Friendfinders, Inc.
State v. Heckel

Trademarks – identifying third party trademarks that are likely to dilute.
Copyrights – what constitutes authorship of a computer program?
Nanotechnology.
Internet distributions of movies (Harry Potter).
Length of copyrights – Disney’s characters.
Trade secrets – Procter & Gamble has sued Potlatch Corp. to stop 2 former employees from disclosing trade secrets for making paper towels and toilet paper. (Non-compete clauses in employment contracts at issue as well.)