Tag: intellectual property

What is “Business Law”?

Posted by Sharif Faust on
Yasaman Sharif, Esq.

by Yasaman Sharif || 31 July 2020 ||

In our office, we spend much of our time assisting our clients with what is commonly known as “business law.” The term “business law” is a broad term which is commonly used by the public, but is not a defined term under California law.  This post will help explain what we usually think of when we say “business law.” At Sharif | Faust, when we speak to clients about their “business law” issues, our conversation often includes discussion of one or more of the following topics: (1) Business Entities; (2) Business Torts (3) Intellectual Property; and (4) Contracts. To some extent, these four topics are related and intertwined. In this post, I will provide you with a brief explanation of these four topics. We will discuss them more extensively in our future posts.

 

Business Entities

If you are planning to start a new business in California, you may wonder what type of business entity you should form. You may also be concerned about potential tax consequences, personal liability, or required filings and fees, associated with forming a business entity. In fact, when it comes to forming a business entity in California, there are several options that you have. Each option has its own advantages and disadvantages that may make them attractive or unattractive to you based on your particular situation and needs.

We will soon be posting more information about business entities.

 

Business Torts

In general, “torts” means any acts by a person that causes damages, injuries, or harm to another person. Business torts generally refers to acts that are not within the privilege of fair competition encouraged by our laws and public policies, and causing financial harm to a business. This becomes relevant when as a business owner you are concerned that your business is, or has been, harmed due to wrongful acts of other person(s).

To learn more, please see our blog post on business torts.

 

Intellectual Property

Intellectual Property laws exist to encourage artists, inventors, and other creators to make new art, technology, or other creations.  The rest of us benefit from these creations.  In return, we give these individuals the ability to profit from their work directly, without interference from others for a certain amount of time.  The rights these creators receive is akin to a monopoly.  These types of works include trademarks, copyrights, patents, trade secrets, and much more. Then, once the time expires, the works go into the “public domain” and anybody can use them.

To learn more, you should check our blog post on intellectual property.

 

Contracts

The term “contract” is a familiar term to most of us, and we each have seen and/or signed at least a couple of contracts in our lives. For instance, when leasing or purchasing a car, you have entered into lease or purchasing agreements. When leasing a new place as a tenant, or leasing your place to future tenants, you have signed lease agreements. You may also have signed employment or contractor agreements when securing a new job. You may have entered into contracts when investing in a business entity. These are only a few common types of contracts.   But a contract can be used in almost every aspect of life. In general terms, a contract is an agreement between different parties to do or not to do a certain thing. Contracts can be written, oral, or implied. But when a contract is well written and drafted it becomes easier to ascertain what was agreed between the parties if they ever have any disputes.

We will soon be posting more information about contracts.

More Questions?

In future posts we’ll discuss this further. If you have questions beforehand though, please check out the rest of our blog for more information. The content of this blog is provided for informational purposes only, and we are not offering any legal opinions.  If you wish to consult with Sharif | Faust, please contact us to set up a consultation.  This blog does not create an attorney-client relationship with Sharif | Faust. To retain Sharif | Faust, you must sign a written attorney-client agreement. Remember, the results in any case depend upon the specific facts in that case. It is important that you consult with a lawyer you trust. By reading this blog, you agree to our Terms of Use.

Trademarks Are Fun

Posted by Sharif Faust on
Matthew Faust, Esq.

by Matthew J. Faust || 19 June 2020 ||

Trademarks are fun.  No, really!  I know that when most people think of intellectual property lawyers, and trademark lawyers in particular, the last thing they think is “fun.”  Usually, people think of the agents from The Matrix.  But putting these notions aside, the trademarks themselves are fun.  The best part of helping clients obtain their trademarks is the pride they get when they see their logo on an official U.S.P.T.O. registration certificate.  The pride is real and it is intense.  In fact, every small business owner I’ve talked to takes pride in their names and logos and wants their customers to know this.  They put their logos on shirts, cups, pencils, keychains, and anything else they can think of.  So, on top of being fun, trademarks are really important aspects of a business owner’s portfolio.

 

But, no matter how much pride a small business owner has in their trademarks, registering the trademark is commonly the last thing they do when starting up.  Sometimes this leads to decisions that are not so fun—being forced to rebrand, destroying advertising or merchandise, and the sinking feeling of having to start over.  I thought I’d take a few minutes to not only go over what makes trademarks so much fun, but also how to make the final product something you can have pride in.

 

Trademarks are Fun

So, why are trademarks so fun?  One of my favorite trademark cases was written by a well-respected judge in the federal appeals court located in Chicago (that is the Seventh Circuit), in the case of Incredible Techs., Inc. v. Virtual Techs, Inc.  (for those looking for a citation, it is 400 F.3d 1007 (7th Cir. 2005).  This case dealt with a real dispute about virtual golf.  There used to be a popular golfing game, prevalent in bars, arcades, and anywhere else gaming was done, called Golden Tee.  Golden Tee was made by the plaintiff in the case, Incredible Techs.  They discovered that Virtual Techs had copied a lot of the features from Golden Tee in their game, PGA Golf Tour.  They sued, claiming violations of their Copyright and Trade Dress.  The Court of Appeal‘s opinion spent nearly three pages describing the two games, what they looked like, and how they played.  This is what makes trademarks fun!  The appellate judge began his opinion by writing:

As anyone who plays it knows, golf can be a very addicting game. And when real golfers want to tee-it-up, they head for their favorite course, which might be a gem like Brown Deer in Milwaukee, a public course that nevertheless plays host to an annual PGA Tour event every July. What most golfers do not do when they want to play 18 is head for a tavern. Also, most people are quite familiar with Tiger Woods. But who knows Jeff Harlow of Florissant, Missouri? This case is about “golfers” who prefer taverns to fairways and aspire to be more like Harlow than Tiger. Our case concerns video golf.

You see, at the beginning of the case, Incredible Techs sought a Temporary Restraining Order.  These are standard requests in trademark disputes, but what made this hearing extraordinary was the six-day evidentiary hearing the District Court held to consider the Motion.  Most trials do not last that long.  Many lawyers in state courts are thrilled to get 45 minutes at hearing and some federal judges decide motions without a hearing at all!  Six days is a tremendous amount of time to talk about video golf.  But, it’s what happened in those six days that are even more astounding.  The District Judge, in his opinion (284 F. Supp. 2d 1069 (N.D. Ill. 2003), went so far as to describe what evidence was presented:

The evidence presented at the hearing included still photographs and video recordings of in-game images from both the Golden Tee and PGA Tour games, as well as full-size arcade versions of each game furnished to the Court for purposes of comparison. The Court also heard testimony from a number of witnesses, including the creators of both games, and the aforementioned Mr. Kostos, who has earned prize money playing both plaintiff’s and defendant’s games professionally.

That’s right.  During the six-day hearing, the District Judge, of course heard from the lawyers and read everyone’s briefs.  But the judge heard from a professional video golfer.  And, everyone looked at pictures and watched videos about video golf.  And, in what must have been the best part of the hearing, each company brought their game for the judge to “consider” (does that mean play in the courtroom?).  To be sure, there was a lot of money at play here.  And nobody likes to feel like their stuff is being ripped off.  But this was not a typical motion (it would not have been a typical trial) and these opinions were not typical opinions.  These are fun!  But, I’m getting ahead of myself here.  What are trademarks and how can businesses use them?

 

What is a Trademark

Trademarks are protectible under state and federal laws.  On the federal side, the appropriately-named Patent and Trademark Office (or “U.S.P.T.O.”) is responsible for reviewing and issuing (or refusing) trademark registrations.  Trademark protection is designed to stop Unfair Competition.  In fact, on the federal side, this term only means trademark infringement, or someone else using your trademark (or something confusingly similar) to sell their goods.  Many states use the same term to include other unfair business practices, though.  But what is a trademark?  As with anything, there is a legal definition and a regular definition.  According to Congress,

the term “trademark” includes any word, name, symbol, or device, or any combination thereof—

(1) used by a person, or

(2) which a person has a bona fide intention to use in commerce and applies to register on the principal register established by this Act,

 

to identify and distinguish his or her goods, including a unique product, from those manufactured or sold by others and to indicate the source of the goods, even if that source is unknown.

 

That’s a lot, but the basics are pretty straightforward.  I like to say that a trademark can be boiled down into  three primary requirements:  (1) something that someone uses or will use (2) in branding their goods or services (3) while selling to consumers in the marketplace.

 

“Something”

The “something” usually includes logos or word-based marks.  Non-traditional trademarks have extra hurdles to meet before registration issued, but it is possible for the “something”  to include colors, scents, or even sounds.  The most important factor is that the trademark applicant show that the “something” is currently in use—without this registration will not be issued.  That being said, a business owner can apply for a trademark before the mark is in use, but the registration certificate will not be issued until after the applicant submits proof that the mark is used.  These are called Intent-to-Use Applications.  By that same logic, once a trademark falls out of use, it will be deemed Abandoned, and can be claimed by someone else.

 

“Branding”

The second part is that the mark must be used to brand goods or services.  In definition listed above, this is the part at the end; “to identify and distinguish her or her goods . . . from those manufactured or sold by others.”  This really comes down to the difference between a brand and a picture.  Someone can draw a cool picture, and that picture will likely be afforded Copryight Protection.  But to obtain Trademark status, the picture must be used to brand goods or services.  This is an important purpose that trademarks have: to let people form a connection between the brands they trust and the quality they expect.

 

“Selling”

The third part is that the mark must be used “in commerce.”  This part of the definition has less to do with the trademark itself and is instead based upon Congress’s ability to “regulate interstate commerce.”  This squares with something called Federalism and runs a bit beyond the scope of this post.  The main point to take away here, however, is the trademark owner must be using the mark to sell or advertise its goods or services to consumers.  Without this, a trademark will not be registered.

 

Trade Dress

There’s one more important form of trademark protection worth discussing—Trade Dress.  Businesses can use trade dress to protect “distinctive” aspects of a product’s  packaging.  In this way, trade dress differs from traditional trademarks because the “something” that is being protected is the packaging or presentation and not the logo itself.  For example, the Coca Cola Company holds a trademark on the word Coke.  It also holds trade dress rights in the distinctive shape of the bottles that Coke is sold in (Reg. No. 1,057,884).  Trade dress should be registered with the U.S.P.T.O. before it is enforced in court.

 

Types of Trademarks

Traditionally, trademarks were marks that were put on goods (like a “maker’s mark”).  Today, our legal system recognizes three other categories of trademarks as well that are all registered by the U.S.P.T.O.:

      • Service Marks: These are similar to trademarks, but are used to brand services offered by businesses (or individuals).  Our logo (Reg. No. 5,327,977) is an example of a service mark because we legal services instead of selling goods.
      • Collective Marks:  These are a special type of trademark or service mark that indicates membership in a group.  One of the more famous collective marks is the AA Mark (Reg. No. 3,316,227 for the American Automobile Association.  Generally the members are permitted to utilize the collective mark when they join the organization.
      • Certification Marks:  These marks are used to show that the goods or services comply with a set of standards.  The mark is held by a third party who then authorizes the user to display on their advertising.  The Wisconsin Cheese certification mark is one such example (Reg. No. 3,378,315).

 

More Information

There’s a lot more to trademarks than this, that’s part of why they are so interesting.  Keep an eye out for future posts on other important areas of trademark law, such Registration, Infringement and Enforcement, Remedies, and other interesting areas in trademark law.

More Questions?

In future posts we’ll discuss this further. If you have questions beforehand though, please check out the rest of our blog for more information. The content of this blog is provided for informational purposes only, and we are not offering any legal opinions.  If you wish to consult with Sharif | Faust, please contact us to set up a consultation.  This blog does not create an attorney-client relationship with Sharif | Faust. To retain Sharif | Faust, you must sign a written attorney-client agreement. Remember, the results in any case depend upon the specific facts in that case. It is important that you consult with a lawyer you trust. By reading this blog, you agree to our Terms of Use.

What is Intellectual Property?

Posted by Sharif Faust on
Matthew Faust, Esq.

by Matthew J. Faust || 4 June 2020 ||

My colleagues and I at Sharif | Faust spend much of our practice advising businesses.  Some are newly formed entities, and some are preexisting business entities.  But, in either event we commonly advise them to consider protecting their intellectual property (or “I.P.” for short).  In these discussions, it is not uncommon to be asked, “what is intellectual property?”  Sometimes this question is easily answered, but other times it’s a bit more difficult.  In this posting I hope to give you a bit of an overview of intellectual property from 10,000 feet.

What is Intellectual Property

Intellectual Property laws exist to encourage artists, inventors, and other creators to make new art, technology, or other creations.  The rest of us benefit from these creations.  In return, we give these individuals the ability to profit from their work directly, without interference from others for a certain amount of time.  The rights these creators receive is akin to a monopoly.  Then, once the time expires, the works go into the “public domain” and anybody can use them.

There is a world-wide organization which helps protect intellectual property.  It is, quite appropriately, called the World Intellectual Property Organization (or “W.I.P.O.” for short).  This organization defines intellectual property as:

Intellectual property (IP) refers to creations of the mind, such as inventions; literary and artistic works; designs; and symbols, names and images used in commerce.

This definition is nice, as far as definitions go, and an it encapsulates the core idea, that I.P. comes from “the mind.”  An I.P. lawyer can easily see references to three major areas of I.P.: Patents, Copyrights, and Trademarks.  But business owners can protect much, much more than this.  Just as a restaurant can protect its secret recipe, a manufacturer can protect its cutting-edge techniques, and a local business can protect its customer list.  Celebrities can protect their likenesses, and writers can protect their idea.  These are all forms of I.P. that can be protected under federal law, California law, or both.

 

Different Types of Intellectual Property

There are many different methods in which I.P. can be protected.  In future posts I’ll discuss some of these forms of I.P. in greater detail, but I put together this brief rundown of some of what can be generically lumped under the term “Intellectual Property”:

 

Trademark

Many of my clients commonly understand trademarks as “brands” but they can include much more than that.  Legally, trademarks refer to the use of a word, logo, or symbol (a “mark”) to brand goods or services in business (“trade”).  Commonly, trademarks refer to text or logos, but they can also include sound, color, or even smell!  Trademarks can be registered by state agencies or the federal United States Patent and Trademark Office (“U.S.P.T.O”).

 

A trademark holder is not required to register a trademark before going to court.  However, courts can give more and better remedies when a work is registered.  This can include court orders or money awards.  Trademarks also include service marks, collective marks, and certification marks.  Famous examples of trademarks include Coca-Cola (Reg. No. 238,157), Disney (Reg. No. 1,162,727), and Milwaukee Brewers (Reg. No. 1,543,238).  Under federal law, trademark infringement can also be called “unfair competition,” but under California law, unfair competition usually means something different.

 

Trade Dress

Businesses can use trade dress to protect “distinctive” aspects of a product’s  packaging.  As the name suggests, trade dress is a category of trademark protection.  There are a few important difference, though.  For example, the Coca Cola Company holds a trademark on the word Coke.  It also holds trade dress rights in the distinctive shape of the bottles that Coke is sold in (Reg. No. 1,057,884).  Trade dress should be registered with the U.S.P.T.O. before it is enforced in court.

 

Copyright

In general terms, copyright protects “expressive works.”  I generally tell clients this includes books, music, movies, translations, and other like works of art.  But, in a quirk of the law, Congress also included semi-conductors and boat hulls in the Copyright Act.  Copyright only applies to works that are “fixed in a tangible medium of expression.”  This means works that are written down, recorded, or saved.  Copyright prevents others from copying, displaying, distributing, or performing another’s work without permission.  It also prevents the creation of unauthorized “derivative works,” or works based on copyrighted works.  This commonly means sequels or spin-offs, but can mean other works as well.  Doing any of these things without permission is an act of infringement.  Copyright does not protect ideas, just the expression in which the ideas are communicated.  To receive full protection under the law, a work must be registered with the United States Copyright Office.  Copyrights must be registered with the federal copyright office and enforced in federal courts—there is no state protection or enforcement of copyright allowed.

 

Patent

Many people understand that patents protect inventions.  Keep in mind, though, that the word inventions is extremely broad in the eyes of the U.S.P.T.O.  Patents can protect office procedures or musical instruments.  Famously, the United States Supreme Court upheld a patent holder’s right to prevent the unauthorized planting of patented soy beans.

 

Trade Secret

When a business develops something of value (trade) and takes reasonable steps to protect it (secret), it has a trade secret.  Unlike most other forms of I.P., trade secrets are protected by state law, not by federal law.  There is also no formal registration process.  When someone steals a trade secret, it is called misappropriation.  The owner of a misappropriated trade secret can ask a court for many different types of remedies, but court orders and money damages are most common.

 

Right of Publicity

This right allows an individual to the use of their name, image, or likeness in a commercial setting.  This is another right that is usually protected by state laws.  Each state has its own law on the books, but California has an especially robust law to protect the publicity of its residents.

 

Literary Property

Some states, including California, protect unfinished ideas that are not written down or recorded.  These states use “literary property” to fill in the gaps to protect ideas that are otherwise not protectible under federal Copyright law.  Imagine that a writer tells a producer about details for a script for a TV show she is working on.  Imagine further that the producer then went on to fire the writer, claim her script as her own, and finish the show without paying the writer.  If the ideas were written in an email, the writer could claim copyright infringement.  But if the script isn’t totally done yet, the writer might have trouble showing the infringement.  Or, what if the writer told the producer the details instead of putting them in an email?  Then, the details wouldn’t be written at all.  In either case, the writer could claim that her ideas are protected as literary property and could obtain a judgment from a court.

 

Moral Rights

For many copyrighted works, the consumer can enjoy the work in any way he or she wants after purchasing it, including reselling the work.  This is called the “First Sale Doctrine.”  However, artists do have continued rights to protect their works.  Most commonly these rights are associated with publicly-viewable fine art installations.  These rights are called moral rights.  For example, what happens if a city commissions an artist to install a large sculpture, but then later decides to tear it down or alter it?  Both California and federal law recognize the moral rights of artists to protect the integrity of their work.

 

Remedies

A remedy is something a court can give an intellectual property owner who has proven infringement.  Each of these forms of intellectual property has slightly difference remedies.  Every form includes form of money payment, commonly called damages.  Most of these cases also include a court order, also called an injunction.  But, the exact nature of these remedies varies a little bit between the different forms of I.P.

More Questions?

In future posts we’ll discuss this further. If you have questions beforehand though, please check out the rest of our blog for more information. The content of this blog is provided for informational purposes only, and we are not offering any legal opinions.  If you wish to consult with Sharif | Faust, please contact us to set up a consultation.  This blog does not create an attorney-client relationship with Sharif | Faust. To retain Sharif | Faust, you must sign a written attorney-client agreement. Remember, the results in any case depend upon the specific facts in that case. It is important that you consult with a lawyer you trust. By reading this blog, you agree to our Terms of Use.