Technopreneurship 101

Lesson 4: INTELLECTUAL PROPERTY

Lesson 4A: Trademarks and Copyrights
The following topics introduce the basic issues of an intellectual property strategy. There
are four major types of intellectual property:
o Trademarks
o Copyrights
o Patents
o Trade secrets
These lessons do not offer legal advice. They help you understand your options in pursuing
the various types of protection available.
Learning objectives:
After the completion of the lesson, the student will be able to:
1. Define intellectual property, trademarks and copyrights
2. Determine what can be protected
3. Recognize the basic issues of ownership
4. Discuss trademarks and copyrights as IP strategies
5. Establish own IP strategy
Intellectual property
Intellectual property (IP) is a form of legal protection for owners who manage the use and
commercialization of their work. Governments and industries embrace IP protections to encourage
new talent to produce innovative and original ideas. Intellectual property is intended to help
creators of new ideas to protect and develop their innovations so that they can successfully bring
those ideas to the market.
What can be protected?
Many things can be protected by as IP—some of them surprising! You can protect a
specific performance or recording, the shape of your product, the words you have written a
chemical formula…
You can protect a sound you want associated with your product. Technology companies
often use sound to create an experience for their users. (You may have heard Microsoft chimes or
AT&T’s cell phones tones.) They trademark those sounds to strengthen the brand and ensure
customer know they are dealing with actual company.
Consider what aspects of your innovation might be protectable. As we discuss trademarks,
copyrights, patents and trade secret, keep an open mind about the wide variety of IP that might
apply to you.
Where are you protected?
IP can be protected nationally and, occasionally, regionally. IP protection only protects you
in the country where it was granted. It does not automatically grant protection outside of that
country. Some entities, such as the European Union, have established regional patent protections.
 Generally, each nation has its own laws relating to IP. They vary widely among countries.
Some countries do not recognize all of these or have specific variations that affect what, how and
when you can secure your IP. Planning to promote a technology in an international market place
will need a clear and strategic IP scheme.
Ownership
When you choose to protect your work, you have many options. These include
sophisticated patent portfolios, disciplined use of trademarks and copyrights, and/or keeping your
most valuable business elements secret through diligent effort.
But before you start thinking about your intellectual property strategies, you must clearly
articulate who owns the technology. Possible owners of the technology include the inventor or co-
inventors; funding sources (university, lab, investors); and your own company.
Documentation
Think of all the knowledge required to successfully execute on your innovation. What
collateral do you have that may be considered IP, and that someone might think he or she owns?
Do you have documented procedures, diagrams, or specifications? Have you created physical
prototypes? Do you have undocumented know-how that is shared with your collaborators?
Documenting your work is one efficient way to clarify ownership. Knowing when your
technology was invented and precisely who invented it is critical for getting IP protection later.
Engineers’ notebooks are a great way to keep an archive of what you have developed and
how it has progressed. A diligent and well maintained notebook can serve as evidence you were
the inventor. It can demonstrate exactly when, and by whom, an idea was generated. By keeping
a disciplined notebook, you establish not only a valuable product development and research tool,
but also a legal tool to aid you in later IP efforts.
Consider giving notebooks to everyone on the team, and treat those notebooks as corporate
assets. If you use a physical notebook, it is a best practice to use one with a binding (with no loose
page…) this way you can later prove when invention occurred.
Notebooks may also take the form of electronic tools and documents. Carefully consider
how those electronic documents are maintained and how you can tell who authored or changed
them.
Ownership questions
As your technology progresses, you might find applications in a new geographical region
or market segment, potential partners or joint ventures, or improvements to the technology. When
planning for the future, know the answer to these questions:
How is ownership of the technology distinct from the company?
How formal are your agreement? If the agreements are informal, what are the expectations
of future developments?
Do current owners have a clear understanding of what their ownership might look like as
the company grows?
What are the expectations of each party about future development? For example, if your
local partners helped to fund the technology locally, how do they expect to participate in the
development of another branch in another country? Do you have processes in place to have
purposeful conversation with them about such issues?
Do you have the right to take the technology into a new place and markets? What kind of
approval do you need from the current owners? What kind of flexibility do you have to join with
new partners?
It is critical to understand and document your ownership. Future partners and investors
need to know you have authority to make decisions. They will be less willing to work with you if
they fear someone new might come in and change the rules of the game.
Having a clear and formal articulation of ownership builds trust with new partners. It shows
them you are thoughtful and respectful of your collaborators.
Now that you understand who owns your innovation, let’s discuss the various types of IP.
Trademarks
Trademarks, one of the oldest forms of IP, have existed for hundreds of years. Two of the
oldest trademarks, established by famous European breweries, date from the 1300s. Now these
brands are recognizable throughout the world.
Trademarks help the public identify the source of goods and services. A strong trademark
protects the owning company’s reputation and prevents it from being associated with inferior
goods. A trademark can help ensure the public is buying products they trust and not pirated or
counterfeit goods.
Your ownership of a trademarks secures exclusive rights to use the trademark to distinguish
your goods and services. Trademarks can also be licensed, allowing you to get revenue from
someone else’s use of your mark.
Some of the popular trademarks
What makes a good trademark?
Trademarks can be designs, letters, slogan, or symbols. Trademark examiners look to see
if your trademark is both distinctive and not deceptive.
Distinctive trademarks describe the product in a way the public can clearly identify. A
distinctive mark must allow the consumer and other competitors to identify the owner without
confusion. For example, Nike shoes bear the distinctive “swoosh” symbol. If another company
chose a similar swoosh, it could cause confusion in the market place. Under trademark law, Nike’s
competitors must choose different, non-swoosh trademarks for their own shoes.
Deceptive trademarks imply qualities the product does not actually have.
In general, there are four types of trademarks:
 Arbitrary or fanciful marks
 Suggestive marks
 Descriptive marks
 Generic marks
Arbitrary or fanciful
Strong trademarks are often fanciful-that is, they do not directly correlate to the product.
Apple Computer is a strong example; if its mark were a computer or phone, that would correlate
to their products and therefore not be fanciful. Xerox and Amazon use fanciful trademarks that do
not correlate image and product.
The downside to a fanciful trademark is that an audience that is not aware of your brand
may miss the connection. Rigorous marketing is needed to establish the trademark for the
consumer.

Suggestive
Suggestive marks help explain your product’s nature, qualities or function. For example,
Coppertone is a suggestive trademark for suntan lotions. Greyhound suggests a bus service that is
fast.
Descriptive
Descriptive trademarks described what they market. To be identified as distinctive,
descriptive marks must achieve a secondary meaning for the customer.
For example, bran flakes can be served with milk and dried fruit in anyone’s kitchen at
home. Most Americans would recognize “Raisin Bran” as a particular brand of cereal and even
have expectations to the flavor and use of raisins. “Raisin Bran” is a descriptive trademark (it
certainly describes what the product is) and has achieved a secondary meaning (a particular
breakfast cereal made by Kellogg’s).
 Descriptive marks can be harder to register, since the company will have to prove they
have created this secondary meaning. Creating a secondary meaning is not easy or obvious.
Companies may need extensive marketing to achieve secondary meaning.
Generic
A generic (or genericized) mark is one that, though formerly owned by an individual company,
has passed into general use. The mark has become a colloquial description or synonym for a whole
class of products or services. For instance, the Otis Elevator Company created the term “Escalator”
as the brand name for its moving staircases, but lost the mark when the word “escalator” became
part of the general vocabulary.
Other words that began as trademark but became generic: aspirin, butterscotch, kerosene,
thermos and zipper.
What can you use in a trademark?
You can use numbers, images, designs, almost anything!
You must use something that is distinctive and not deceptive. For example, when the
University of Minnesota began to commercialized their new variety of apples, they could not use
the name “apple”. They needed something distinctive. They chose “Honeycrisp,” a name
suggestive of the apple’s characteristics. “Apple” works as a trademark for a computer company,
but not as a mark for the actual fruit.
Indicating a trademark
In the U.S., a trademark design is designated by the following symbols:
 Use the ™ symbol for an unregistered trademark to promote a product.
 Use the SM symbol for an unregistered service mark to promote a service that is not a
product.
 Use the ® symbol for a product or service trademark registered with the U.S. patent and
Trademark Office.
The same trademark could be registered in one nation/region but unregistered in another,
according to their varying regulations. Determining an international trademark strategy may be a
key issue for your company if you expect to heavily use a trademark to enhance your marketing
and promotion strategies. If you plan to go international, investigate whether your desired
trademark is available in the countries you want to sell into. It would be disappointing to spend
significant money building a brand around a trademark that works locally, but is too similar to a
company in your target country and cannot be used!
How long do trademarks last?
Trademark duration varies by country or region. In general, assuming you renew the
registration according to local law, trademark protection lasts until you lose or abandon the mark.
You can lose or abandon a trademark if you stop using and maintaining it. Once the mark is lost
or abandoned, you no longer have the IP protection it offers.
The legal definition of abandonment varies from region, so talk to your IP advisors to understand
its legal steps and ramifications. It is important to consider the value your trademark might have
before you abandon it. It could be an asset to your company’s value, should you choose to sell the
company.
If you register a trademark, pay careful attention to filing or response dates from the patent
office, so you do not unintentionally abandon your application and miss the opportunity to protect
your product.
Another way to lose a trademark is to allow it to become a generic. Trademarks owners
sometimes need to remind the public their trademarks are not generic words. Xerox corporation’s
“anti- generic” ads are perhaps the best known. They discourage generic use of the term “Xerox”
to mean “copying paper”. One of their marketing messages urged customers to pause and think:
“When you use Xerox the way you use Aspirin, we get a headache.” The company did not want
Xerox to become generic for photocopying the way aspirin is used to refer to generic pain reliever.
Protecting your trademark
It is your responsibility to protect your trademarks. You are responsible for monitoring the
proper use of your mark and for defending it from inappropriate use. If you plan to legally enforce
your trademark, you need to demonstrate you maintained it and took steps to protect it.
If you license your technology, you must continue the monitor the licensee’s activities
relating to your trademark. A trademark represents the owner’s reputation for goods and services
of a certain level of quality. Consumers tend to rely on this reputation in making purchasing
decisions. If a licensor does not exercise sufficient control over the quality of the good and services
offered by the licensee, the trademark may become vulnerable.
Some firms do trademark monitoring for a fee. You might also set up processes within your
company to actively monitor and protect your trademark. For example, you might have someone
on staff who regularly checks search engines for use of your trademark online. You can work with
an attorney to create a letter that asks violators to stop using your trademark.
Copyrights
A copyright is the easiest form of IP protection to acquire. Typically, you are automatically granted
copyright as soon as you create the work.
What is a copyright?
The right to copy is a limited monopoly that allows the owner of a work to control how the
work can be distributed, printed, performed, etc.
For over 300 years, governments have recognized it is critical to be able to protect a new
and innovative work. To encourage innovation and creativity, they help ensure creators benefit
from their creation. This encourages them to write more books and thus to aid the flow of ideas
and learning.
The concept of a copyright originated with the Statute of Anne in Britain. This act gave the
author of a work the right to control how it was used. It was created “for the encouragement of
learned men to compose and write useful books”. At the time, publishers were reprinting the works
of authors without their consent, and authors felt it was” to their very great detriment, and too often
to ruin of them and their families”. The statute also established the concept of fixed term-meaning
authors were given control for a fixed period of time.
What can be protected?
Copyrights are granted the moment the work is created and do not require formal
protection. Examples of copyrighted work include literature, choreography, dramatic pieces, art,
music, software code, etc. Even your notes from a meeting can have a copyright.
A copyright protects expressions – not the pure idea or concept, but the expression of that
idea. Facts and ideas are not copyright-protected-only the expression of those ideas in a piece of
work. For example, if you were gathering data on the average speed of automobiles, database of
data or a report on your results are both copyrightable. The fact that a car drove at a given speed
is not copyrightable.
The idea of writing a book on how to get your ideas into the market is not, by itself,
something you can copyright. Many authors can write books on this topic. But once you write your
own version of the topic, your expression of that idea –the specific book-is protectable.
Registering a copyright
To sue copyright infringement, you must register your copyright. If you suspect you would
want to stop someone from infringing on your copyrights, consult legal advisors. There are legal
costs associated with both registration and litigation. Registering a copyright may provide a strong
disincentive to infringe on your work, since it indicates your commitment to protecting your work.
The costs indicate you might rigorously go after the infringer!
This is an important element of your IP strategy, especially if the value of your work is
best protected by copyrights rather than patents. (for more about patents, see the next module).
What rights are protected?
A copy right typically includes these rights: to produce copies or reproductions of the work
and to sell those copies (including mechanical rights and, sometimes, for electronic copies or for
distribution)
 To import or export the work
 To create derivative works (works that adapt the original work)
 Perform or display the work publicly (performance right)
 To sell or assign these right to others
 To transmit or display by radio or video (broadcasting rights)
As the owner of a copyright, you have the power to grant these rights to other people in return
for financial compensation. For examples, you could give someone the exclusive right to distribute
your work in return for a fee.
Who owns the copyright?
Copyrights were indented to protect creators. But there are some situations where the work
you do may belong to someone else. If you created a work while you were an employee of a
company, the work may belong to the company. A company’s employee agreement might include
clauses that claim rights to all works created by the employees, even works created when not on
the company time. If you did the work as a freelancer, the purchaser might buy the copyright as a”
work made for hire”.
 Remember to ask very early in the process: who owns the copyright? What are the rights
of each owner? If a company or client wants to keep certain restriction on the work (by limiting
how can you use it), it is fair to consider that in your financial negotiations.
How long does a copyright last?
Copyright laws have been standardized to some extent through international conventions
such as the Berne Convention and Universal Copyright Convention. These multilateral treaties
have been ratified by nearly all countries, and international organization such as the European
Union or Word Trade Organization require their member states to comply with them.
Still, every country is different! Each country or jurisdiction has separate and distinct laws
and regulations about copyright. The duration of your copyright can vary depending on what kind
of work it is, whether it has been published, whether the author is known and anonymous, and
whether it was created by a person or a company, etc. In the U.S., in general, if the work has not
been published and is by an identifiable author, the copyright lasts throughout the life of the author
+ 70 years.
If copyrights are key to your ability to benefit from your work, it is worth the effort to do
your research and find out what rules apply to you.
When should you talk to an attorney?
It is always best to consult legal experts early and especially in these cases:
 If you think your business could be damaged by someone infringing upon your work
 Before you spend considerable money on a marketing
 Before you go global
A Harvard business review article listed the top ten legal mistakes made by entrepreneurs –
number 5 was “Waiting to consider international intellectual property protection.”
(hbswk.hbs.edu/cgi-bin/print/3348.html)
Take Note!
Remember, it is critical that you have clear and documented ownership of all of your IP.
Once you have clarity on who owns and controls your work, you can begin to craft an IP strategy.
Trademarks and copyrights are effective protections. Trademarks can be used to help your
customers identify you as a source of goods and services. They help to build your brand and protect
your quality and reputation in the market place.
Copyrights allow you to control how your work is distributed, printed and used.

Reference:
Peterson, Robert A. Innovation Readiness Series. 2012