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Can You Protect Your Gasp?
Knowing the Differences Among Patent, Copyright, and Trademark
Intellectual property (also called IP) is the hot buzzword in startups, and for good reason. So much of what you create these days can’t be tangibly touched, but can be protected. You need to know your rights and opportunities when starting up any business. There are many non-legal services that offer copyright and trademark registration, but without a proper understanding of intellectual property or hiring an attorney with a comprehensive understanding of intellectual property, you may find yourself making catastrophic errors.
Intellectual property in the U.S. consists of:
● Patents
● Trademarks, service marks, and trade dress
● Copyright
● Trade Secrets (more on that in the next chapter)
● Mask Works (circuit design, not discussed here)
Patents
Patents are granted for useful, novel, and non-obvious inventions for processes, methods, machines, manufactured goods, and compositions and improvements. Inventors apply to the United States Patent and Trademark Office, and patents are granted if the examiners at the Office believe your invention is suitably useful, novel, and non-obvious.
There are utility patents, design patents, and plant patents (which are so narrowly focused as to likely have little relevance to you). When a utility patent is granted, the invention’s novelty exists in the way it is used. When a design patent is issued, the novelty exists in the invention’s design. So, if you 3-D print, let’s say a cup, unless you find a new use for that cup that has not been patented before, the only way that cup will be granted a patent is if the design of the cup is so unique that no cup has been created quite that way before.
Patent attorneys and even patent agents are in short supply, and the U.S.P.T.O. has been notoriously backlogged. An ordinary attorney will be of little use to you in your pursuit of a patent for your invention, and you must be strategic when applying for a patent, so do your due diligence when seeking out a patent agent or patent attorney.
Trademarks and Copyright
Lay people often confuse trademarks and copyrights — often referred to as “soft IP” — for each other. Most small businesses will need to deal with trademark or copyright matters, and it’s often in these areas that a little bit of prevention will buy a small business a whole lot of cure.
In the United States, trademarks are usually registered federally through the United States Patent and Trademark Office, though they can often be registered with the state in which the trademark will be used or has been used. The U.S.P.T.O. defines a trademark as
“…generally a word, phrase, symbol, or design, or a combination thereof, that identifies and distinguishes the source of the goods of one party from those of others. A service mark is the same as a trademark, except that it identifies and distinguishes the source of a service rather than goods… A trademark typically protects brand names and logos used on goods and services.”
A trademark can protect a word or words, shapes, colors, sounds, smells, and designs. When determining whether a “mark” infringes an already registered mark, the main question posed is: “Are these marks confusingly similar in this trademark class?” For instance, you can have a Dove chocolate-covered ice cream bar and Dove soap because, even though both products use the same word, “Dove,” they are registered in very different product classes, and would not be confusingly similar in their respective classes.
Copyright is an intellectual property right that is conferred on an original creative work “fixed” in a tangible medium. The laws surrounding copyright are very often confusing even for judges. One of the primary sources of confusion comes from the concept of “fair use,” which has been traditionally considered a defense to a copyright infringement claim. In other words, the concept of fair use is something that comes up in a lawsuit.
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Fair Use
The four factors of copyright fair use considered in a lawsuit are:
● The purpose and character of use of copyrighted work.
● The nature of the copyrighted work.
● The amount and substantiality of the portion used.
● The effect of the use upon the potential market.
Another consideration that has been lumped in with the fair use factors has been the question of whether the new work that has infringed on the copyright is sufficiently “transformative,” i.e. whether the new work turns the old work into something substantially new. This question of transformation has been one that has been posed with a high level of inconsistency. Just because you think your work has completely transformed someone else’s work doesn’t mean a judge or jury will agree with you.
Unfortunately, there is no application process to allow your use of someone else’s original work to be labeled “fair,” and if you want to make sure you will not likely face a lawsuit, you need to be sure you are not using copyrighted material, whether fairly or not. Or, you can discuss the issue with an attorney and together determine whether your use of copyrighted material would likely be considered fair in a court of law, but keep in mind that you are playing with fire, and be prepared to defend a suit even if you are likely to be victorious.
Trademark Fair Use
There are also the concepts of trademark fair use and “nominative” fair use, which are fuzzier and less established. Some might argue it is an artificial standard created by certain segments of the judiciary. Nonetheless, different courts have come up with standards for fair use infringement of trademark. A federal case in New York involving Oprah delineated guidelines for trademark fair use, finding that the trademark was used:
● In a way other than as a mark.
● In a descriptive sense.
● In good faith.
Nominative fair use, a phrase coined in a Ninth Circuit case that involved the band New Kids on the Block suing a company that was conducting a "New Kids on the Block survey," may be a valid defense to a claim for trademark infringement when:
"First, the product or service in question must be one not readily identifiable without use of the trademark; second, only so much of the mark or marks may be used as is reasonably necessary to identify the product or service; and third, the user must do nothing that would, in conjunction with the mark, suggest sponsorship or endorsement by the trademark holder."
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The Law and Practicality of the Bully Pulpit: Big Names Go After Small Business
Why do entertainment stars go after the “little guy” for copyright and trademark infringement? The short answer? Because they can. You may have heard that Etsy sellers have been sent "cease and desist" letters for incorporating Taylor Swift's lyrics, or that an entrepreneur sculpting a 3-D likeness of the "Left Shark" from Katy Perry's 2015 Super Bowl performance has been accused of copyright infringement. But, really, why go after the "little guy?"
Even if musicians and other entertainers make a lot of money, they often see legal fees as the cost of doing business in a "360 degree" world. They want to make more money and may not want their personal brands co-opted by strangers. But intellectual property law is complicated, and small business startups are often surprised when they hear from lawyers from other parts of the country. There are a few issues in intellectual property law that have made small businesses ripe for C&D letters and actual litigation (lawsuits) from entertainers.
It seems that everywhere you look, big name artists are embroiled in litigation or some sort of legal dispute. Most of these battles settle before trial, so the outcome rarely affects "case law" — law created or clarified by the outcome of a trial or appeal.
However, a trend of late is the tendency of lawyers to try to make trademark out of copyright cases, copyright out of patent cases, and generally shoehorn one type of law into another. For instance, Taylor Swift has made claims for trademark infringement of lyrics. To try to make sense of this, let's take one of her big hits, "Shake It Off."
Now, it would be impossible for Ms. Swift to claim she created the phrase "shake it off," so she would find no refuge in copyright law. But she may claim that the phrase has become so distinctively associated with her song - maybe even has acquired "secondary meaning" - that she may use the phrase in commerce.
Trademark law requires quick response from the holders of trademark, as a failure to oppose someone else's use of the mark (name, design, or phrase) may be seen as a tacit surrender of any claim to the mark. Trademark law is meant to be a battleground; it often becomes an area where the deep-pocketed claimant can attempt to shut down the poorer defendant.
One example is the letter that clothing entrepreneurs received from a lawyer for Seattle's Space Needle, claiming trademark infringement for a black-and-white drawing of the Space Needle from a photo taken by one of the entrepreneurs.
The idea that the owner of a building can claim a monopoly on the use of any image of that building may be anathema to creativity and innovation, but a successful defense would not be a slam dunk for a tiny retail business and is often just not worth it. A cease and desist letter for trademark infringement can be written for next to nothing, yet forces a small business into submission if it doesn't know how to fight back.
On the other hand, lawyers sometimes try to force a square trademark or patent peg into the round hole of copyright. Copyright law is old, in need of serious updating, and comes with riders such as the Digital Millennium Copyright Act (DMCA) that can sometimes do more harm than good. Because Katy Perry and the NFL likely did not anticipate the meme of the "Left Shark," it had not registered the Left Shark with the U.S.P.T.O.
Since a creative work's copyright begins at the moment of creation, a copyright cease and desist was sent instead. However, it did not sound like a valid claim, because Katy Perry did not create the costume, and the sculptor selling the shark has not copied the creative expression of the Left Shark's Super Bowl performance.
But why are lawyers using different forms of IP law to go after unsuspecting defendants? For one thing, IP law is constantly being reshaped and re-defined by the dizzying progress of technology.
One of the biggest purveyors of evolving technology, Google has found itself a defendant in two lawsuits in recent years that demonstrate the apparent uncertainty of copyright law: one by an actress who sent a DMCA takedown notice for a film in which she appeared, claiming she had a “moral right” to her performance, and another by tech titan Oracle, which claimed copyright in Android source code (usually, software disputes are fought in patent court). Google won both cases, but certain issues stemming from those cases may still be ripe for future fights.
And the DMCA is likely to be seriously overhauled. If an actress can claim copyright for her own performance in another person's film and a computer company can claim that source code is a creative work in this day and age, creative lawyers can find multiple opportunities and causes of action to extract money from businesses.
In fact, the Copyright Office is aware of all of the changes technology brings to the creative world, and took technology’s impact on the arts into consideration when it issued a 2015 report on Music and Copyright. The report, a massive 200+ page tome, acknowledged the challenges and changes of the music landscape, including the distribution of royalties to the indie artist.
However, even though royalties schemes and copyright law are due for overhaul, indie labels, musicians, and agents are more likely to be focused on the fundamental and practical realities of the music business: now, more than ever, the music business is not about the music. It's about the whole package.
Just as theatrical distribution of film was/is a loss leader for DVD, digital, and merchandising, a song is just the beginning of an entire branding blitz. For instance, artist management contracts and music contracts often involve a "360 deal" or "multiple rights deal" which gives music labels profit participation in all aspects of an artist's income, not just income from recordings.
While we may not be privy to the particulars of their different relationships and contracts, and the 360 deal may not be applicable in these situations, you can be sure the lawyers for celebrities such as Perry and Swift recognize that the brand is so much bigger than the music.
However, as a practical matter, cultivating goodwill is also a part of their brand, and if a little entrepreneur makes big waves in the press and social media, celebrities may back down. A good lawyer knows the law and practical consequences in the "real world."
Sometimes, when a company or celebrity is powerful enough, a simple letter is all that is necessary to destroy the creative impulse. In the end, a small business can successfully fight cease and desist, but would be wise to investigate potential intellectual property pitfalls before making rash responses to the war drums of "Big Law."
Takeaways
● There are many non-legal services that offer copyright and trademark registration, but without a proper understanding of intellectual property or hiring an attorney with a comprehensive understanding of intellectual property, you may find yourself making catastrophic errors.
● Intellectual property in the U.S. consists of: patents, trademarks, service marks, trade dress, copyright, trade secrets, and mask works.
● A trend of late is the tendency of lawyers to try to make trademark out of copyright cases, copyright out of patent cases, and generally shoehorn one type of law into another.
● An idea is never protected by copyright. It is the execution of that idea that is protected by copyright.