This document provides an overview of intellectual property (IP) basics for businesses and entrepreneurs. It defines intellectual property as creations of the mind that are usually intangible and protected by law. The four main types of IP covered are copyrights, trademarks, trade secrets, and patents. For each type, the document explains what they protect, how rights are obtained, and important considerations for businesses. It emphasizes the importance of identifying, tracking, protecting, and enforcing IP rights as a valuable business asset.

1. Intellectual Property Basics
for Businesses and Entrepreneurs
May 19, 2016
© 2013-2016 EB Resource Group. All rights reserved.

2. Disclaimer bla bla bla…
Although I am an attorney, nothing in this
presentation is or should be deemed legal
advice. Please consult an appropriate
professional for your particular situation.

3. What Is “Intellectual Property”
or “IP”?
• Property created “with the mind”
• Usually intangible
• Owners granted exclusive rights
• Protected by federal, state and international
laws

4. Why Is IP Important?
• Creativity, Innovation, Competition
• Asset on Company’s Books
• Generates Revenue
• Employment
– 40 million jobs/27.7% of all jobs in the U.S. economy*
• U.S. Economy
– 34.8% of U.S. GDP in 2010*
– 60.7% of total U.S. merchandise exports in 2010*
– “The entire U.S. economy relies on some form of IP, because
virtually every industry either produces or uses it.”*
*Intellectual Property and the U.S.
Economy: Industries in Focus (2012)

5. What Laws Protect IP?
• Copyright: Federal Law
• Trademark: State and Federal Law
• Trade Secrets: State and Federal Law
• Patent: Federal Law
• International Treaties, too

6. Why Should Business Owners and
Entrepreneurs Know About IP?
• “Issue Spotting” by Management
• Awareness of Company IP (created by EEs and ICs)
• Avoid “Chain of Title” Issues
– Founder-created IP
– Selling the business
• IP Management
– Short/long term decisions
• Avoid Infringing IP Rights of Others
– Activities by EEs and ICs
– IP litigation is increasing
– Very expensive, time consuming

7. What Are the Most Common
Kinds of IP?
• Copyrights
• Trademarks
• Trade Secrets
• Patents

8. COPYRIGHTS

9. What is a Copyright?
Exclusive rights granted to:
– Original work (aka “Work of Authorship”)
– Tangible Form
Limited (but long) Period of Time
• What happens after that?
– “Public Domain”: anyone can use the work

10. Examples of Copyright
Protected Works
– Education/Training Materials
– Software (source code)
– Music
– Graphic Images
– Audio Recordings
– Photographs
– Videos
– Movies
– Articles/Publications
– Books
– Mobile Apps (code)
– Books

11. How Created?
• Original creative work
• In a Tangible Form
– Paper, CD-ROM, videotape, Word document
That’s it!

12. Who Owns the Copyright?
• General Rule: whoever creates it, owns it.
• Exceptions:
– Employers
• Course/scope of employment: employer owns
• Outside course/scope: employee owns
– Independent Contractors: IC owns, unless:
• “Work Made for Hire”; or
• Assignment
• Founders: who owns IP created before the company
existed-founders or company?

13. Is Registration Required
For Protection?
No, But:
• Searchable Database
• Extra legal protection and rights
• Must Apply/Register to Bring a Lawsuit

14. What Does the “©” Symbol Mean?
• Copyright notice
– Example: © 2016 ABC Publishing Company
• Claim of Ownership

15. Copyright Infringement
• Using someone’s copyrighted work without
permission
• Litigation is expensive and time consuming!
• “Fair Use” Exception

16. Common Copyright Myths
• I got it off the Internet, so it’s free and I can use it.
– No. It’s likely protected by copyright and you need
permission.
• I gave the copyright owner credit or a “disclaimer,” so I’m safe.
– Credit isn’t enough! You must have permission or an
exception.
• I only used a small portion, say, a paragraph of an article, or
just a few seconds of a song.
– Using a little bit doesn’t necessarily mean you’re safe.
– Could be the “golden nugget” of the work

17. Common Copyright Myths, cont.
– I helped someone else infringe, but I didn’t actually do it myself.
– Contributory liability (you knowingly helped someone else
infringe)
– I’m just the employer; my employee or the independent
contractor I hired did the infringing.
– Vicarious liability (you are liable for some else’s acts based
on a special relationship)
– I mailed a copy to myself; that creates copyrights in the work.
– Mailing helps prove who created it and when. Doesn’t
create copyrights in the work.

18. Copyright Takeaways
• You don’t own it: get written permission
• Work created for you: get contract signed
FIRST
– Especially with independent contractors
• Think “Fair Use” Applies: talk to attorney

19. TRADEMARKS

20. What’s a Trademark?
• Words (Apple®)
• Phrases (“I’m Lovin’ it”tm…McDonald’s®)
• Sounds (NBC® chimes)
• Colors (ebay® colors)
• Symbols/logos (Nike® swoosh)
• Trade dress (Campbell’s® soup can)
– shape of Coke® glass bottle
• Combinations of the above
• Used on/in connection with goods/services
Apple®, “I’m Lovin' ItTM, McDonald’s®, ebay®, Campbell’s®, Coke®and NBC® are registered
trademarks of their respective owners.

21. What Does a Trademark Do?
• Identify and distinguish the source of goods
and services from those of others
– Doesn’t identify the business
• Protects goodwill (business reputation)

22. How Do Trademark Rights Arise?
• General Rule: first to use wins!
–Even if other mark is registered
• Actual Use

23. How Long Do Trademark Rights Last?
Forever, as long as you continue to use it as a
trademark.

24. Trademark Search
Always do a “knockout search” first.
• Internet
• Domains
• Social Media
• Registration Databases
• Search Report
• Trademark attorney

25. Types of Trademarks
Made up words: Best
Ex: “Advair”
Arbitrary words: Better
Ex: “Apple” for computers
Descriptive words: Little/no protection
“Fast Computer Shop”
Generic words: No protection
“Bundt” for bundt cakes

26. Is Registration Required
For Protection?
No, But:
• Searchable database
• Extra legal protection and rights

27. What’s the Difference Between
“tm”, “sm” and ®?
TM, SM and ® are trademark notices
• TM: trademark
• SM: service mark (services)
• ®: trademark is federally registered with the
United States Patent and Trademark Office

28. What is Trademark Infringement?
• Using someone’s trademark (or
something similar) without permission
• Using it in a way that creates improper
appearance of
–Affiliation
–Endorsement
–Approval of use

29. Trademark Takeways
• Trademarks must be “searched” before use
• The more descriptive, the less protection
• Consider registration

30. TRADE SECRETS

31. What is a Trade Secret?
• Information:
– Not generally known to public;
– Economic benefit to owner; and
– Reasonable efforts to keep it secret
• Examples:
– Coca-Cola Recipe
– KFC fried chicken recipe
– Customer list with pricing specifics/key personnel
– Marketing Plan

32. How Long Does Trade Secret
Protection Last?
Forever, so long as it remains a trade secret of the
holder.

33. Be Aware: You May Have
Trade Secrets
• Not identified, so not protected
• Once disclosed, no longer “secret”

34. How To Protect Trade Secrets
• Keep Confidential
• Use Confidentiality Agreements (NDAs)
• Good Business Practices
– Shredding confidential documents
– Not openly available on network
– Password protected, encrypted files
– Restrict access to “need to know” basis

35. Defend Trade Secrets Act of 2016
• New federal law
• Lawsuits in federal court
• “Whistleblower notice” in employment, NDA,
assignment agreements

36. PATENTS

37. What is a Patent?
An exclusive right granted by the U.S.
Government “…to exclude others from making,
using, offering for sale, or selling” an invention
in the United States and importing the invention
into the United States.

38. What Can Be Patented?
Any new and useful
process,
machine,
article of manufacture,
composition of matter,
or any new and useful improvement thereof.
New: not already existing/patented
Useful: must have some use; low threshold

39. Three Types of Patents
1) Utility (ex: machine in manufacturing plant)
2) Design (ex: body design of auto)
• Doesn’t Include functional aspects
3) Plant (ex: hybrid flower)

40. Search & Registration
• U.S. is “First to File” Nation
• Search patent database first
– Uspto.gov
• Registration is Required for Protection
– Copyright/trademark: registration is optional
– Trade Secrets: can’t be registered (wouldn’t be
secret)

41. How Long Do Patent
Rights Last?
• Utility and Plant: 20 years from application
date (not the grant date)
• Design: 15 years from grant date
• What happens after that?
– Public domain-anyone can make the invention

42. Patent Notices
• “Patent pending”: application is pending
before USPTO
• “Patent” or “pat.” followed by registration
number: invention has a patent

43. What Is A “Provisional
Patent Application”?
• “Placeholder” application
• Less formal than standard application
• Often used to secure investors, funding for startups
• Benefit: if a normal patent granted, protection starts
from date of prov. patent application; that’s it
– Doesn’t provide other patent rights
• Must be converted into normal patent application
within one (1) year

44. What is Patent Infringement?
Using/selling invention without permission of
patent holder
Patent litigation is expensive!

45. Patent Takeaways
• Do patent search before using/selling
invention
• Keep invention confidential until patent
application filed
– Use NDAs
• Litigation is time-consuming & expensive

46. Conclusion
IP:
–Is a valuable asset for businesses
–One of greatest revenue generators in the
U.S.
–Keeps the company competitive and
innovative
–Litigation can be so expensive and time
consuming; it can “kill” a small business

47. IP Takeaways
1. Identify, Track, Protect, Enforce IP Rights
2. Educate and Train Management, staff, ICs
3. Have an IP Management Plan
a. IP Policy/IP in company handbook/invention assignment agt
b. Periodic Education and Training
c. Periodic IP Audit
d. IP part of business plan
– short/long term goals
4. Get Help From an IP Attorney

48. Resources
• Copyright: copyright.gov
• Trademark/patent: uspto.gov, sos.ca.gov
• Trade Secret: see federal/state laws
• International: wipo.org
• Domains: icann.org
• California law: leginfo.ca.gov

49. Questions

50. Time for the Activity!!!