Transcript research.unc.edu

Top 10 Intellectual Property
Mistakes Made by Emerging
Companies
Carolina Innovations Seminar
Randy Whitmeyer, 12/03/09
hutchlaw.com
1
“Starting companies is like having
babies–fun to conceive but
hell to deliver.”
- Anonymous
hutchlaw.com
2
What is Intellectual Property?
 Intangible property rights associated
with creations of the mind, namely:
 Patents
 Trade Secrets
 Copyrights
 Trademarks
 Compare with “real” property and “personal”
property
 Limited to specific country/territory
hutchlaw.com
3
Requirements to Patent
 Valid Subject
Matter
 Useful
 Best Mode
 Written Description
 Enablement
 Novel
 Non-obvious
hutchlaw.com
4
Patent Prosecution Process
 Draft Patent Application (time is variable)
 Describe state of the art, problem solved
 Include figures
 Prepare “Claims” = metes and bounds of the invention
 File Provisional or Non-Provisional Application
 File Foreign counterparts and U.S. Continuation-in-Part
Application
 Patent Term – 20 years from Priority Date
 U.S. prosecution may take 3-5 years
hutchlaw.com
5
Trade Secrets
 Business or technical information
 Derives actual or potential value from
 Not being generally known
 Not being readily ascertainable
 Can last forever if secrecy is
maintained & reasonable steps are
taken to preserve secrecy
hutchlaw.com
6
What Can be a Trade Secret?
 Formulas
 Processes
 Compilations of
information
 Project launch dates for
new products
 Patterns
 Marketing plans
 Methods
 Computer programs
 Devices
 Techniques
 Negotiated price lists in
a contract
 Programs
 Customer lists
hutchlaw.com
7
Maintaining Secrecy
 Take affirmative steps to maintain secrecy
 Mark documents as confidential; put employees and
business partners on notice
 Use Confidentiality Agreements
 Restrict facility and computer access (secure facility;
computer passwords; etc.)
 Perform exit interviews with departing employees
(reminder of obligations; whereabouts of information)
hutchlaw.com
8
Copyrights
 Original works of authorship
 Fixed in a tangible medium of expression
 Perceived, reproduced or otherwise
communicated
 Directly or with use of a machine
hutchlaw.com
9
Types of Copyrightable Works
 Textbooks, magazines, plays, brochures, software
 Visual Works: photographs, paintings, icons,
graphics
 Sound: sound recordings, song words and music
 Motion Pictures: films, videos
 Others: mask works, blueprints, etc.
hutchlaw.com
10
Not Copyrightable
 Idea
 Principle
 Procedure
 Mere facts
 Process
 Lists
 System
 Names, slogans, short
phrases
 Method of operation
 Concept
hutchlaw.com
11
Rights of Copyright Owner
 Copyright owner has the exclusive right to:
 Make copies
 Prepare derivative works (e.g., translation, book
from screenplay, modified work)
 Distribute or sell copies
 Publicly perform or display
hutchlaw.com
12
Trademarks
 Trademark law is aimed at consumer protection –
preventing companies from deceiving customers
and taking advantage of the good will built by others
 The good will inherent in company and product
names, and other identifiers of source, is often a
company’s most important asset.
 For example, Red Hat doesn’t own any software, but
jealously guards its trademarks
hutchlaw.com
13
Types of Trademarks
Levels of
Distinctiveness
Arbitrary or Fanciful
(Exxon, Kodak)
Suggestive
(Ultracath)
Descriptive
(ATMVerify)
Generic
(Aspirin)
Characteristics
Strong
No secondary
meaning required
Little or no
relationship to
goods and services
Somewhat weak
Secondary meaning
may be required
Suggests some
feature of goods
and services
Weak
Secondary meaning
required
Describes the goods
and services
Unprotectable
No TM significance
Generic
hutchlaw.com
14
Benefits Of Federal TM Registration
 Obtain constructive nationwide use
 Establish priority over other users
 Recover additional damages, attorneys fees
 Obtain access to customs/import remedies
 Protect and establish rights in domain names
 Use “®” for US registered marks only (“TM” can be
used for common law rights)
hutchlaw.com
15
hutchlaw.com
16
Acknowledgements
Thanks for input to the Top 10 list from:
 Allen Baum, Brinks Hofer
 Eric Jensen, Withrow Terranova
 Bentley Olive, Law Offices of Bentley Olive
 Gregory Stephens, Williams Mullen
hutchlaw.com
17
Number 10
“Let’s save money by using
contractors for R&D tasks and not
signing any agreements”
hutchlaw.com
18
Number 9
“We just found out that our scientific
founder published a paper on a really
important improvement.”
hutchlaw.com
19
Number 8
“We signed a great long-term
partnering agreement! Their agreement
looked well-written so we used it”
hutchlaw.com
20
Number 7
“Open Source software and other
materials on the Internet are saving us
a lot of time. It’s great that they are so
easy to download”
hutchlaw.com
21
Number 6
“We filed our provisional patent
application on our own. We can hire a
lawyer to clean it up when we file a nonprovisional based on this provisional”
hutchlaw.com
22
Number 5
“Since we were able to incorporate our
company name and obtain a domain
name for our company and products,
there is no reason to worry about
trademarks”
hutchlaw.com
23
Number 4
“We patented our technology, so there is
no need to worry about freedom to
operate”
hutchlaw.com
24
Number 3
“We don’t need an IP Plan –
Let’s file on everything (or nothing)”
hutchlaw.com
25
Number 2
“We are moving so fast –negotiating and
signing Nondisclosure Agreements will
just slow us down”
hutchlaw.com
26
Number 1
“We set aside 10K in the budget for IP –
we want to protect everything,
everywhere, plus we need a freedom to
operate opinion.”
hutchlaw.com
27
Conclusions
 Enter Into Proper Founder, Contractor and
Employee Agreements
 Determine and establish your business goals,
and identify what key IP will support those goals
 Engage in appropriate patent and trademark
searches, including freedom to operate
 Prepare applications for registration (patents
and trademarks)
hutchlaw.com
28
Conclusions, continued
 Properly mark and attribute materials
 Protect trade secrets and copyrights
 Use care in entering into IP-related
agreements
hutchlaw.com
29
Hutchison Law Group

Serving the Southeast’s life science and
technology communities.

Represent companies of all sizes, with a
strong focus on emerging growth
companies from inception through exit.

Serve clients along the Southeast
corridor from Maryland to Florida.

Extraordinary depth and experience in
law, technology and business.
Randy Whitmeyer, Partner
|
[email protected]
hutchlaw.com
|
919-829-4319
30