KMD | Intellectual Property

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Patents are an instrument covering an invention for a limited period (generally 14 to 20 years) in which the inventor may exclusively make, sell, or use a product. While this right may be licensed to other entities, it is the sole right of the inventor to both enjoy the benefits of his or her invention while also excluding others from using that same invention.

Patents fall into two broad categories – utility and design patents. A utility patent is concerned with ‘how’ an invention operates while a design patent is focused on the look (commonly referred to as the ‘ornamentally’) of the invention.[1] Equally, while a utility patent is a very descriptive patent (describing, in great detail, the operability and function of an invention), a design patent is only concerned with the invention’s appearance.[2] Correspondingly, the cost involved in constructing a utility patent often far exceeds the cost of writing a design patent – where certain inventions may be eligible for both.

If you have an idea that needs protection now and is not quite ready for commercial sale, you can file a provisional patent that allows you preliminary protection and a priority date. One year from filing the provisional patent, you would then be required to file your nonprovisional, or permanent application, thus maintaining the priority date of your provisional patent filing.

Trademarks/Service Marks

Trademarks consist of a word, phrase, symbol, and/or design that identifies and distinguishes the source of the goods of a producer while a service mark identifies the source of a service as opposed to a good.[3] This is probably the most recognizable intellectual property, in that the general public is exposed to trademarks, and service marks, on a daily basis. Think brand names, logos, and slogans (including jingles, i.e. “I’M LOVIN’ IT”)[4].

Unlike patents, trademarks do not expire after a set term. Trademarks can exist indefinitely, with a few exceptions, so long as they remain (1) ‘in use’ and are (2) maintained through maintenance fees every 5 to 10 years depending on the term of maintenance. Further, trademarks gain strength through use, increasing in potential power, while patents lose value at the point of expiration.

If you have a trademark idea, but are not using it yet, you have the ability to apply for a trademark as “intent to use,” which gives you more time to create product and develop services before using the mark in commerce. Once you are ready to use the mark in commerce, you can then convert the application to “in use” and receive a trademark registration. It is extremely important to file for a trademark early once you have identified your brand name or logo, or settled on the top few candidates, most especially if you are interested in brand protection. Obtaining a trademark will help ensure that you are the only existing user with your specific name or slogan, giving you the power to enforce your rights against others.[5]

Of course, such power is only useful if you have the protection before you need to use it. Trademarks take time for the USPTO to process, typically 6-9 months from application to registration in the best-case scenarios and with everything ready and approved, on the first try. Before you spend large amounts of precious startup investment or operating capital on branding, marketing, product design, or labelling, you must ensure you have a clear right to brand your products and services as you have chosen. Otherwise, you risk spending large amounts of company time and resources only to find out that 6-9 months prior, or even only a few days prior, someone else applied for or already had applications or registrations on file with the USPTO, and thus is a superior user to you. Now you are in negotiation and settlement mode with a plaintiff, rather than the safer position of being the trademark holder.

Trade Dress Trademarks

A trade dress trademark is often seen as a branch of Intellectual Property protection that falls under the trademark umbrella. A trademark protects what can be defined as “brand identifiers.” That’s your name(s), logo(s), and slogan(s), primarily. A trade dress trademark protects the overall appearance, layout, and image of a product/packaging. Some of the most common examples of a trade dress trademark are the shape of a coke bottle,[6] the layout, look, and feel of a Starbucks store, the unique look and structure of a handbag, the color of turf on a football field,[7] and the stark red of a Christian Louboutin stiletto.

A hybrid of patents and trademarks, registration requirements for a trade dress trademark are not as simple or straight forward as their trademark counterpart. A trademark requires in sum (1) use or a bona fide intent to use and (2) distinctiveness. A trade dress trademark on the other hand requires: (1) distinctiveness in the marketplace—i.e. a high level of brand recognition among consumers, also known as “Acquired secondary meaning,” (2) use in commerce, (3) service as the identifier of a particular source—i.e. consumers immediately recognize your product or service and connect it to your brand and the goods/services provided under that brand and (4) primarily non-functionality—if a feature is functional that means it is likely to be used by different makers of the same/similar products preventing it from being connected to one particular brand. Unlike a Design patent, use and disclosure to the public of a trade dress trademark can make your claim to those specific IP rights stronger.

Copyright is a form of intellectual property allowing the copyright holder to make ‘copies’ of a creative work for a limited, albeit long time – typically from 50 to 100+ years after the creator’s death. Creative works can include artistic, literary, or musical works.[8] You can even copyright the photograph your grandmother took of Elvis.[9] And while the copyrighted work is specific to an individual or group of individuals, some limitations (e.g. fair use by the public for educational purposes) may apply.

Creating a copyright is extremely important because in doing so, a public record is created. This will put the world on notice that your work is protected and that you are the copyright holder. Additionally, it allows others, who may be interested in licensing your work, the ability to purchase rights to use your protected materials.

Unlike patents, but similar to trademarks, there are some inherent rights as an author of a copyrightable work that come from the moment the work is created. However, to enforce those rights, you must register your copyrights with the US Copyright Office. Without doing so, you lack jurisdiction and various claims or remedies against your infringers.[10]

Given a copyright is relatively inexpensive compared to a trademark, and much less than a full patent application, not just in filing expenses but also in labor, it is a highly recommended best practice for authors, artists, and creators to regularly file and maintain their copyright catalogs. Further, when licensing or transferring rights, the copyrighted work, as registered, will be an easy asset to define ownership of and subsequent transfer to new owners.

If you have created unique intellectual property that has garnered popularity, then it could be possible to earn royalty payments through its widespread use. You can allow your work to be used by others for profit as long as you are provided a fair percentage of their total profit or a flat royalty amount. When creating a royalty contract, our legal team will want to consider:

• Uniqueness of your intellectual property
• Popularity, value, or use of IP
• Requested or intended use
• Predicted profits or income through IP

Royalties can be related to musical pieces, artwork, literary publications, and even patents. Commonly, business owners will encounter royalties when establishing a new franchise location for their company. No matter why royalties might be needed, you can be certain our team can create a contract that benefits you.

A licensing agreement is similar to royalties in that it allows another party to recreate intellectual property for their own use. The licensing agreement will be established between a licensor and a licensee. To use the intellectual property, the licensee will typically provide an upfront amount of finances to the licensor, as well as providing a proposed contract that outlines how the IP will be used.

Product licensing agreements can be used as a common example. In such an agreement, the licensor owns a unique product or IP and grants limited rights to use to the licensee. The licensor gains the benefit of finances, and the licensee generally gains the benefit of a more recognizable brand name or corporate presence behind their product.

Kearney, McWilliams & Davis and our intellectual property attorneys are here to make certain your company does everything it can to succeed. A key portion of your business plan could be relying on licensing agreements to generate extra revenue. We will work diligently to create contracts between you and licensees that benefit your company and create a fair, profitable connection. You can also depend on us if you are a licensee who wants to approach a licensor with a proposed agreement.