Lewis Resolves Intellectual Property Disputes
Most businesses have intellectual property rights that are important to the success of the business. As our economy is increasingly becoming service and technology oriented, the value of many businesses is largely incorporated in its IP. This means resolving intellectual property disputes is vital to a company’s long-term success.
The value may be:
- It’s trade name and logo.
- It’s branding through trademarks its goods and service.
- It’s works of creative authorship in its software, designs, music, books, publications, and photographs.
- It’s creation and collection of a valuable stock of information constituting trade secrets.
- It’s contracts with employees that prohibit disclosure of information, post-employment competition and solicitation for customers, suppliers, and employees.
These IP rights may be valuable to provide a legal competitive advantage by:
- Setting your business apart from competitors preventing customer confusion and increasing goodwill.
- Protecting innovation from those less willing to invest in research and development.
- Offering your customer something new, different and unique.
- Laying the basis of a relationship to your customer base, and giving your business a legitimate competitive advantage.
Lewis guides clients in selecting trademarks that will be strong, registerable, and enforceable, and that will avoid disputes with other trademark owners. Lewis assesses prospective trademarks for clients in an understandable and cost-effective manner. Lewis assists clients to resolve trademark disputes with advice, negotiation, mediation, arbitration and litigation. Many disputes over trademarks also involve other business disputes. Read more about Trademarks.
Lewis guides clients in avoidance of copyright problems in creating works of authorship, defensible litigation-ready registrations, and sound licensing practices. Lewis assists clients to resolve trademark disputes with advice, negotiation, mediation, arbitration and litigation. Some disputes over copyrights also involve other business disputes. Read more about Copyrights.
Lewis is not admitted to practice before the Patent Office. He refers clients to patent lawyers for patent prosecution and patent litigation. Lewis assists clients and associated patent lawyers to resolve business and patent disputes with advice, negotiation, mediation, arbitration and litigation.
Lewis guides clients in pre-dispute protection of trade secrets through advice and drafting of contracts to protect confidential, proprietary, and trade secret information. Lewis assists clients to resolve trade secret and intellectual property disputes with advice, negotiation, mediation, arbitration and litigation. Many disputes over trade secrets also involve other business disputes. Read more about Trade Secrets.
Lewis, a former software developer and software company CEO, guides clients in best legal practices in software development, through employee contracts, independent developer contracts, works for hire, fair use issues, public domain issues, compliance with open source and Creative Commons considerations and licenses, the avoidance of copyright infringement, and assessment of software infringement under the abstraction-filtration-comparison test. Lewis assists clients to resolve software disputes with advice, negotiation, mediation, arbitration and litigation.
Trademarks and Service Mark Overview
A trademark is a word, name, symbol, phrase, or combination that identifies the source of a good or product, and distinguishes it from other goods or products. For example, “Golden Flake” identifies products made by the Birmingham company of the same name.
A service mark identifies the source of services. For example, “Sneaky Pete’s Hot Dogs” identifies the restaurant services of a Birmingham company. For purposes of trademark law, trademarks and service marks are treated the same.
These marks not only allow consumers to quickly identify the source of the product, they also allow a business to gain a competitive advantage when its mark comes to stand for a high quality product. For the mark to distinguish one source of a good from another the mark must be distinctive. If the mark is not sufficiently distinctive, the consumer cannot distinguish one competitor’s goods from another resulting in confusion, which is bad for the consumer and the business. In determining whether a mark is distinctive, the courts focus on the relationship between the mark and the product using four categories that define requirements for the mark, and degree of legal protection afforded the mark.
- An arbitrary or fanciful mark bears no logical relationship to the product. For example, “Buffalo Rock” has no inherent relationship to either ginger ale or soft drink distribution. Such marks are easily capable of identifying and distinguishing a product and the law gives them a high degree of protection.
- A suggestive mark evokes or suggests a characteristic of the underlying good. “Energen” is suggestive of energy but does not specifically describe natural gas distribution. Suggestive marks are inherently distinctive and are given a high degree of protection.
- A descriptive mark describes, rather than suggests, a characteristic or quality of the underlying product. For example, “Golden Flake” describes a potato chip. Giving a potato chip manufacturer the exclusive right to use the term could confer an unfair advantage so full trademark protection is not immediately available. However, the mark may be protected by trademark law once the consuming public associates it with a particular source of potato chip manufacture. This is called secondary meaning. The public need not be able to identify the specific manufacturer; only that it comes from a single manufacturer. Evidence of secondary meaning includes the amount and manner of advertising; the volume of sales; the length and manner of its use; and the results of consumer surveys.
- A generic mark describes the general category of the product belongs. Should a brewer attempt to brand a variety of beer with “Beer” as its trademark, trademark law would give no such exclusive right. Giving a single beer brewer the right to exclude other beer brewers from using “Beer” as trademark would not provide a distinction between the brewing sources, and would give an unfair competitive advantage not unlike a monopoly. Marks that are generic are unprotected by trademark law.
Ultimately if a trademark otherwise qualifies for protection rights to a trademark by being the first to use the mark in commerce or by being the first to file with the U.S. Patent and Trademark Office.
Applications to register a mark are of two types: actual use or intent to use. Marks actually used for more than a token purpose may be registered upon the basis of actual use in interstate commerce. An intent to use application may be filed for proposed marks when there is a good faith intention to use. Following examination, the Trademark Office may issue a notice of allowance, which must be followed up with a further filing once the mark is actually used in commerce. Since descriptive marks are not protected as trademarks until they have acquired secondary meaning, there is a supplemental register for descriptive marks capable of becoming distinctive which can block registration of confusingly similar marks in the interim.
Federal registration with the U.S. Patent and Trademark Office provides benefits to the owner including the right to use the mark nationwide with some limitations, enhanced rights, including use of federal courts with potential treble damages and attorney fees, constructive nationwide notice of ownership of the mark, and incontestability of the exclusive right to use the mark after five years.
Copyrights protect the expression of ideas, but never the idea. Patents protect the application of ideas embodied in a product or process. Trade secret laws and contracts may protect raw ideas. Copyrights protect the rights of authors and their transferees.
The legal basis for patents and copyrights is found in the U.S. Constitution. Congress has the power:
- … 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.
The Copyright Act of 1976 provides the basis for copyright law today, although copyright lawyers still have to refer to the 1909 Act since copyrights last a long time. Analyzing a copyright issue starts with the statute’s rules governing subject matter and scope, ownership and transfer, duration, notice, deposit, registration, infringement and remedies, and operations of the Copyright Office. While the rights of copyright are found in statutes, these rights form one component of intellectual property. These rights of copyright are the subjects of massive commerce, which increases daily in the digital age. This commerce is based upon a contract based trade in copyrighted works which starts with the creation of a work of authorship including issues of employment, ownership, transfer of ownership, assignment and licensing.
Copyright has minimal substantive requirements. That requirement may be simply stated: an author has a copyright in his or her work if it is his or her original work of authorship that is fixed in a tangible medium of expression. However, every word counts. Questions of authorship, originality and fixation are fertile ground for dispute.
Copyright provides the author a number of exclusive rights:
- Reproduction right
- Adaptation right
- Public distribution right
- Public performance right
- Public display right
To adhere to the international Berne Convention, the Visual Artist Rights Act of 1990 provided some new very limited rights to authors of works of visual art such as attribution of authorship, prevention of misattribution of authorship, and protection of the work from intentional modification or destruction.
Upon the demonstrated failure of many digital rights management (DRM) technologies, new types of copyright protections were added by the Digital Millennium Copyright Act of 1998 (DMCA). The Act prohibits circumvention of anti-access technology to access copyrighted works. It also prevents the making and trafficking of devices or services to circumvent either anti-access technology or any technology that effectively protects any of the exclusive rights of a copyright owner.
Copyright registration requires submittal to the Copyright Office of an application for registration with some required information. The form is deceptively simple, but loaded with legal terminology. Mistakes in filling out the form, possibly even inadvertent or innocent mistakes, may invalidate the registration
In addition to the registration application, the work may be required to be deposited, in whole or in part. There are also many rules concerning deposit of works. An incorrect deposit may invalidate a registration. Special rules exist for the deposit of software, including rules for the deposit of source code as to which a claim of trade secret is made. If infringement is charged, the owner will have the burden to prove the exact deposit made with an application since otherwise there is no way to judge whether the alleged infringing work is substantially similar to the registered work.
Registration is valuable since infringement litigation, even limited to an effort to obtain a temporary restraining order or injunction, cannot be brought until the application and deposit are submitted. Further, statutory damages and attorney fees are generally unavailable for infringement occurring prior to registration, which is very significant to the owner since often statutory damages exceed any provable actual damages.
Trade Secret Overview
Lewis Resolves Business Disputes Over Information, Including Trade Secrets. Trade secrets law protects information. Unlike patents which protect ideas, copyrights which protect the expression of ideas, or trademarks which protect marks indicating the source of goods or services, trade secrets only protect information.
Trade secrets law is based upon the law of the individual states. There is no generally applicable federal law, although legislation has been introduced to federalize trade secret law.
All states either have trade secrets legislation or recognize some form of trade secrets under common judge-made law. While a voluntary organization has drafted a “uniform” trade secrets law which states may enact, Alabama chose to deviate from the uniform law when it passed its legislation.
The Alabama Trade Secrets Act governs claims for misappropriation of trade secrets in Alabama. This Act supersedes inconsistent prior judge-made law.
The Alabama Act defines a trade secret as “information” meeting six requirements, all six of which must be proven to establish a protectable trade secret:
- The information must be “used or intended for use in a trade or business”.
- The information is “included or embodied in a formula, pattern, compilation, computer software, drawing, device, method, technique, or process”.
- The information is “not publicly known and is not generally known in the trade or business of the person asserting that it is a trade secret”.
- The information cannot “be readily ascertained or derived from publicly available information”.
- The information is “the subject of efforts that are reasonable under the circumstances to maintain its secrecy”.
- The information has “significant economic value”.
In litigation, the focus is often on whether or not the “information” can be articulated with sufficient specificity to allow proof of the six elements. Only by expressing in words exactly what “information” is claimed to constitute the trade secrets may the six elements be proven about that specific information. In several cases involving software, the trade secret claim has failed with executives, who were not programmers, attempting to explain with specificity what specific information in the software was a trade secret.
Obtained by Improper Means
In addition to proving that the claimed trade secret information meets each of the six defining criteria of a trade secret, there must also be proof that the information was obtained by one of any six specific “improper means” which the statute defines as:
- Inducement of a breach of confidence
- Other deliberate acts taken for the specific purpose of gaining access to the information of another by means such as electronic, photographic, telescopic or other aids to enhance normal human perception, where the trade secret owner reasonably should be able to expect privacy.
Remedies available should the plaintiff prevail on a trade secret claim are serious with the plaintiff having very favorable remedies to recover money including each of these remedies:
- Recovery of the profits and benefits conferred by the misappropriation. The burden of proving these profits and benefits is set in the Act:
- First, the plaintiff is required to present proof only of the misappropriator’s gross revenue.
- Second, the burden shifts to the defendant to present proof of his or her deductible expenses and the elements of profit attributable to factors other than the trade secret.
- Third, the recovery is the difference between the gross revenue proved by the plaintiff and the deductible expenses and profit attributable to other factors proved by the defendant.
- Actual Damages.. Other “actual damages” are allowed to the extent they are “not duplicative.”
- Punitive Damages.. “If willful and malicious misappropriation exists, then the plaintiff may recover punitive damages capped so as not to exceed the greater of $10,000 or the monetary damages.”
- Injunction. Injunctive and other equitable relief is available for actual or threatened misappropriation of a trade secret.
- Attorney Fees.. Reasonable attorney’s fees may be awarded to the prevailing party if:
- A claim of actual or threatened misappropriation is made or resisted in bad faith.
- A motion to terminate an injunction is made or resisted in bad faith.
- Willful and malicious misappropriation exists.
Resolving Intellectual Property Disputes
If you’re struggling with intellectual property disputes, Lewis can provide the advice and assistance needed to resolve these issues. Contact Lewis at 205-939-3900 to obtain legal advice and resolution.