Intellectual property rights are the property rights of the owners of inventions, creations, designs and other works. These are intangible rights, which you normally can’t see, unlike real property and goods. Intellectual property laws are the laws meant to protect and enforce those rights, which can include copyright, trademarks, and patents.These types of rights have become more critical as technology has moved beyond hardware into new frontiers, such as software, biotechnology, and the internet, with its ability to transmit content and services globally.
In the United States, the Constitution gives Congress the authority to grant rights to authors and inventors and to regulate trademarks. The intellectual property laws passed by Congress are enforced by the U.S. Patent and Trademark Office (USPTO) and the U.S. Copyright Office. The USPTO is also tasked with registration and enforcement of patents and trademarks, while the Copyright Office is where copyrights are required to be registered.
What is a patent?
A patent is an exclusive property right related to an invention, which is defined by the World Intellectual Property Office as a “product or process that provides in general, a new way of doing something, or offers a new technical solution to a problem.” In the United States, patents are granted by the United States Patent and Trademark Office (USPTO). To get a patent, the patent application has to provide the invention’s technical information to the public. Examples of patents include machines, manufactured goods, certain manufacturing processes, and chemical compositions.
What protections does a patent offer?
Basically, the owner of the patent has the exclusive power to prevent others from economically benefiting from their invention. Others can not make, use, distribute, or sell the invention without the permission of the owner of the patent. If the inventor, after a lot of hard work, came up with a new good or process, that person should enjoy the financial rewards of that work. Someone can not simply copy another’s work and make money from it without permission. A properly filed patent will ensure that the creator has the legal standing to enforce his or her rights against this kind of infringement.
Is a patent valid outside the United States?
Patents are generally only valid in the country where they are registered; though, there are treaties that protect intellectual property rights.
How long does a patent last?
This depends on what type of patent it is:
What is a trademark?
The USTPO defines trademark as “a word, phrase, symbol, and/or design that identifies and distinguishes the source of the goods of one party from those of others.” Trademarks are protected by intellectual property rights. Everyday examples of trademarks include the Nike “swoosh” or the Uber logo.
How can I protect my trademark?
In the United States, to protect a trademark, it should be registered through the USPTO. Internationally, it can be filed with each individual country’s trademark office, or through the World Intellectual Property Office’s Madrid System.
What rights does trademark registration provide?
In principle, a registration will give the owner of the registered trademark the exclusive right to the use of the trademark. Which means it can be exclusively used by the registered owner, or it can be licensed to a third party for a period of years in return for a fee. Example: the use of the French Lacoste “alligator” brand was licensed in the United States to Izod for a number of years. Registration gives the owner, clear standing, in terms of commercial rights and for litigation.
How long does a trademark last?
The term of trademark registration can vary, but it’s usually ten years. Provided you pay the fees promptly, it can be renewed indefinitely.
What kinds of trademark can be registered?
A trademark can be one word or a mix of letters words and numbers. Drawings, symbols, the shape or packaging of goods (i.e. the Coca Cola bottle) and other signs, such as sounds or smells (Chanel perfume), and even shades of colors (Ferrari Red)
What is copyright?
The copyright is grounded in the U.S. Constitution and granted by law for original works of authorship fixed in a tangible medium of expression. Copyright law covers both published and unpublished works. Works covered by copyright range from books, music, paintings, sculpture, and films, to computer programs, databases, advertisements, maps, and technical drawings.
What does copyright protection cover?
Copyright vs. patent or a trademark?
Copyright protects the authorship of certain works, while patents cover inventions or discoveries. A trademark protects “words, phrases, symbols, or designs identifying the source of the goods or services of one party and distinguishing them from those of others.” Apple, for example, owns the patents to the iphone; the trademarks “Apple” and the Apple logo that appear on the phone; and the copyright to the IOS software that runs the phone.
When does copyright protection start?
Copyright protection starts at the moment the work is created and fixed in a tangible form that it is perceptible either directly or with the aid of a machine or device. Think of the moment scenes for a movie are shot and recorded. Those images are now afforded copyright protection. No one else can reuse those shots without permission.
What rights does the copyright owner have?
There are two types of rights under copyright:
Our clients come from a wide variety of industries and sizes. We help advise clients about the best ways to protect their existing intellectual property rights. This involves a broad range of services that ranges from business formation, contracting and licensing, and contract drafting and litigation.
We can summarize our Texas intellectual property practice in these three areas:
Business Formation in Texas
When starting a new business in Texas, it is advisable to seek legal assistance to look at the different business structures available. In the State of Texas, these structures are set out in the Texas Business Organizations Code and administered by the Texas Secretary of State. The options include: C Corporations, S Corporations (which has to be filed through the IRS), Limited Liability Companies (LLCs), as well as other entities for professional partnerships and non-profits. A corporation is formed by filing a certificate of formation with the State of Texas Secretary of State. If you have an existing corporation in another state, you can register it to do business in Texas.
Intellectual Property Advantages to Incorporating
These entities offer different advantages/disadvantages from legal and taxation standpoints, so it is always good to consult with a CPA besides a lawyer. One of the most popular business structures is the corporation because it protects the individual owners from being personally liable for the debts and responsibilities of the company.
In the case of intellectual property, incorporating offers inventors, creators, and entrepreneurs advantages for protecting their copyrights, patents, and trademarks. It puts the public on notice that the holder of the registered trademark or patent is a corporation or LLC in Texas. Since corporations in good standing, federal trademarks, and patents are electronically searchable, it means both competitors and potential partners can easily find who the legal owner of the intellectual property is. For litigation purposes, it means that there is little confusion over ownership for any party conducting a due-diligence search.
To illustrate how important incorporating a business can be, ask the simple question of who owns the intellectual property in the business? Does it belong to one owner? To three shareholders in a partnership? To the contract software developer who wrote code or an employee who did the work? Does the company hold a license? In the case of a shareholders’ divorce is the IP part of the marital assets? Who gets the IP in a corporate bankruptcy?
Corporate Ownership of Intellectual Property
Setting up a corporate structure can help clarify the rights to business intellectual property. A corporation can hold the patents, copyrights and trademarks created by the partner(s) and/or employees of the company. An independent contractor hired to produce software can sign an agreement assigning all IP rights in his work product to the corporation.
Then you may have a really common scenario. A company’s founder contributes his patents, trademarks or copyrights to the company assets at formation. In a sole proprietorship that might be the only assets of the company at formation. If he/she has partners, they might bring in capital. Think of businesses started based on one invention or program. A start-up where the developer brings his app or program and partners supply investment capital. Or, new partners buy into an existing corporation through purchase of stock in the company.
This just goes to show the type of complexity that can surround the formation of a business where intellectual property is one of the main assets, if not the main asset!
The Importance of Proper Business Formation for IP
Having a proper corporate structure is critical in all these scenarios. It keeps all the assets of the company under the ownership of the corporation and not individuals. That ensures that the corporation’s rights and obligations are legally tied to the company and not to individuals. The corporation and not owners/investors individually are liable for the debts of the company. If there is litigation, the corporation itself has standing to bring suit or be sued, instead of individuals.
Having shareholder, partners, owners with clearly spelt-out roles and ownership interests allows for more certainty and less confusion. Contracts and licenses can even be included into the operating agreements or incorporation papers filed with the state, creating a record.
Many corporate entities require a board of directors or partners meetings—with a record taken of the proceedings and filed. Changes in ownership structure must usually take place at these meetings. They often require special notice—like with weeks of notice through certified letter. These conditions can be set during the incorporation process by counsel with agreement of all partners.
The advantages of formally incorporating a new or existing business are many. For owners of intellectual property, it is even more critical. Whether it’s for transparency, certainty, or for standing, the benefits clearly outweigh the downside.
Our law form can help you choose the right type of business structure to protect your company and its intellectual property.
At Eldredge Law Group, our full-service IP practice offers Intellectual Property Litigation in Texas state court, federal courts, and administrative agencies. Our experienced litigators handle a wide variety of IP litigation, including patent, copyright, and trademark infringement. Our experienced litigators handle a broad range of intellectual property property actions at the state and federal level. We handle copyright, patent, and trademark law, including USPTO Trademark Trial and Appeal Board proceedings. Protect your intellectual appointment and schedule a consultation in our Houston or Dallas office.