© Husch Blackwell LLP

Trademarks, Trade Dress, Copyrights, Trade Secrets

and Patents: The Cornerstones of a

Franchise System

Wade Kerrigan

Kris Kappel

IP Law Resources

• Trademarks – www.uspto.gov

• Trade Dress • Copyrights

– www.copyright.gov • Trade Secrets • Patents

– www.uspto.gov – www.google.com/patents

A trademark or “brand name” is “anything” that identifies the source of goods or services from those of another when used in commerce.

What is a Trademark?

A Trademark Can Be: A Word or Group of Words

• COKE

• CABBAGE PATCH KIDS • DON’T LEAVE HOME WITHOUT IT

A Trademark Can Be: A Symbol, Pictorial

Representation or Design • NIKE “Swoosh”

• LACOSTE Alligator

• Olympic rings

A Trademark Can Be: A Combination of Word(s) Plus

Symbol, Pictorial Representation or Design

NESTEA

CHURCH’S

A Trademark Can Be: Numeral(s), Letter(s) or Combinations Thereof

• 501 Jeans

• IBM computers

• V-8 Juice

A Trademark Can Be: A Shape of a Container, Packaging

or Building (“Trade Dress”)

• COKE bottle • Conical top of CROSS pen

• TOBLERONE chocolate packaging

A Trademark Can Be: A Color

• Orange for THE HOME DEPOT stores

• Pink for Owens-Corning’s insulation

A Trademark Can Be: A Sound

∙ MGM Lion Roar ∙ NBC Chimes

A Trademark Can Be: A Scent

“The mark consists of a high impact, fresh flower fragrance reminiscent of Plumeria blossoms”

–U.S. Reg. No. 1,639,128

Trademarks vs. Service Marks

• Trademarks identify products or goods

• Service marks identify services

Trademark Searches

• Make sure you are not infringing third-party marks and the mark is available

• Knock-out search –Quickly determine obvious risks to

using the mark or clear obstacles to registering the mark

Trademark Searches • Comprehensive search

– Includes federal trademark registrations and applications, state trademark registrations, public domain, websites, registered domain names, and business entity names

– Knock-out search returns one or more results very close to the mark

– Appears mark is used elsewhere in commerce

• The importance of comprehensive searches for franchisors

Trademarks vs. Trade Names

• A trademark is used to identify and distinguish the trademark owner’s goods or services from those manufactured or sold by others and to indicate the source of the goods.

Trademarks vs. Trade Names

• A trade name is any name used by a person to identify his or her business or vocation. –Trade Name: Phillip Morris USA –Trademark: Marlboro –Trade Name: The Coca-Cola Company –Trademark: Coke or Coca-Cola

Trademarks vs. Trade Names

• Clearing a trade name through the Secretary of State business entity database does not necessarily mean that the trade name is available for use as a trademark.

• Secretary of State’s offices will allow very similar names to be registered.

• For Registered Marks:

“®” or “Registered in the U.S. Patent and

Trademark Office” or “Reg. U.S. Pat. TM. Off.” • For Unregistered Marks:

“TM” “SM” or an asterisk indicating “A

trademark/service mark of XYZ Corporation.”

Proper Marking

• There is no such thing as an “international trademark”

• File in each country • May file under Madrid Protocol

which allows you to file in multiple countries for less

International Trademark

Copyrights

• In the U.S.: –Copyright exists automatically upon

creation of a copyrightable work (fixed in a tangible medium)

– Federal registration is not required –However, you cannot sue for

infringement without a federal copyright registration

International Copyrights • There is no such thing as an “international

copyright” that will automatically protect an author’s writings throughout the world.

• Protection against unauthorized use in a particular country basically depends on the national laws of that country.

• However, most countries offer protection to foreign works under certain conditions that have been greatly simplified by international copyright treaties and conventions.

Copyright Notice

© [year of creation] [owner] © 2012 Husch Blackwell Sanders LLP

or

Copyright [year of creation] [owner] Copyright 2012 Husch Blackwell Sanders LLP

Who Owns the Copyright?

• You hire a programmer who creates software or a website for your business.

• Who owns the copyright in the software?

• Who owns the copyright in the content?

Work for Hire

A work prepared by an employee within the scope of his/her employment (i.e., it was part of the job duties of the creator to create the work).

Work for Hire • A Work for Hire is NOT hiring an

independent contractor and paying her to create a copyrightable work for you.

• ALWAYS get a written agreement

from the author, photographer, programmer, etc. that assigns their copyright rights and interests in the work to you.

Duration of Copyright

• Life of the author plus 70 years. • If work for hire: shorter of 95

years from publication or 100 years from creation.

Web Site and Software Issues for Franchisors

• Franchise Agreement Restrictions

on Web Sites • Software for the franchise system • Data Security

IP Policy • Developments • Inventions • Confidentiality • Trade Secret Protection • Ownership Issues • Social Media • Software Compliance

Trade Secrets

• Trade secrets: –are not generally known to the public, – are protectable as long as the

information remains secret, and –have been the subject of reasonable

efforts to maintain confidentiality.

Trade Secrets • Confidentiality measures must be

reasonable under the circumstances: –Non-disclosure or confidentiality

agreements –Advising employees that information

is trade secret –Marking documents “confidential” –Employment agreements

Trade Secrets

• Examples - –recipe for a certain type of food

or drink (Coca-Cola or KFC) –customer list –techniques/processes for a

special method of making known composition or device

Patents • What is Patentable?

– Anything under the sun made by man

• What is not Patentable? – Natural Phenomena

• Snow, Leaves – Mathematical formulas

• Pythagorean Theorem – Laws of Nature

• Even Sir Isaac Newton loses out – Abstract Ideas

• A cure for cancer would be nice

Patent Term • Utility Patent (Non-provisional) -

20 year patent term – any new and useful process, machine,

article of manufacture, composition of matter, or any new and useful improvement thereof

• Design Patent- 14 year patent term – any new, original and ornamental design for

an article of manufacture • Plant Patent - 20 year patent term

– a distinct and new variety of asexually produced plant

Patent Reform Act • Enacted September 16, 2011 • Change from First-to-Invent system to

First-to-File system • New Prior Act Rules • New Prior Use Rights • New Administrative Review Process

– including expanded rules for third party involvement in the patenting process

• New Litigation Rules • Prioritized Examination

– ($4,800 ruling within 1 year)

First-to-File vs. First-to-Invent Scenario

• Senior inventor who conceived of an invention first, but did not immediately file an application

vs. • Junior inventor who made the first

patent filing for the invention, but who conceived of the invention after the senior inventor

Patents

• Provisional Patent Applications –Preliminary (informal) application –Advantages

• Secure an early filing date • “Patent pending” • Test marketability of products • Less expensive

–Disadvantages

• Only lasts 12 months – then must file a non-provisional application or it is abandoned

• Never examined • Never issues as a patent

Patents • Unchanged by enacted of Patent

Reform Act

• Patents grant their owner the right to “exclude others from”: – Making the invention

– Using the invention

– Selling the invention

– Offering the invention for sale

– Importing the invention

Patents

• U.S. patent covers only the United States.

• Separate patent necessary in each country – no one patent covers the world. There is no such thing as an “international patent”.

Prior Art – The New System

• Anything worldwide which, before the filing date of the application, was: – Patented – Published – Used publicly – On Sale – Otherwise available to the public – Disclosed in an application filed prior to the

filing date of the application

Disclosure

• Do not inadvertently disclose technology that may be patentable by: – Posting technology/pictures on website – Submit an article for publication – Offer to sell or licenses technology (no

tradeshows) – Distribute samples – Conduct consumer tests – Distribute advertising – Demonstrate a prototype to public group

Questions?