PROTECTING INTELLECTUAL PROPERTY RIGHTS

IN INTERNATIONAL TRADE

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Why does IP matter?

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Top IP “Myths”

Only large “high-tech” companies have IP

Securing your IP rights in the US will give you protection in other countries, as well

- EVERY business has IP Assets. - A significant amount of innovation comes from individual

inventors & SME’s

In most cases, US IP rights mean nothing outside US

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The Problem with International IP Protection

– Protecting US-created IP abroad continues to be a huge issue for American companies.

– Counterfeiting is a multi-billion dollar annual industry

Protecting IP Assets: I.S.E.

1. Identify

2. Secure

3. Enforce

Three Phases

Identify IP Assets

• Trademark• Copyright• Patent• Trade Secrets

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Types of IP

Trademarks – “first to file” vs. “first to use” jurisdictions

Situations that might give rise to legal issues for a typical company include:

• Formation of new company or spin-off

• New products/marketing campaign

• Enter new markets (incl. overseas)

• Notice a similar mark used by other company

• Merger/Acquisition or Financing

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Types of IPCopyright-

Under Berne Convention, this is the one type of US IP right that gets automatic protection in other countries

Situations that might give rise to legal issues Situations that might give rise to legal issues for a typical company include:for a typical company include:

• Creation of web siteCreation of web site• Hire software company to develop computer programHire software company to develop computer program• Create training materials/PPTsCreate training materials/PPTs• AdvertisementsAdvertisements• Develop newsletter or fact sheets to distribute to Develop newsletter or fact sheets to distribute to

clients/post on web, etc.clients/post on web, etc.

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Types of IPPatents- Situations that might give rise to legal issues Situations that might give rise to legal issues

for a typical company include:for a typical company include:

• Company invents a new product or software Company invents a new product or software applicationapplication

• Company develops a new business methodCompany develops a new business method

• Start-up wants to raise money by pitching its new Start-up wants to raise money by pitching its new invention/method to potential investorsinvention/method to potential investors

• Learn of a competitor’s use of a patented productLearn of a competitor’s use of a patented product

• Merger/Acquisition or FinancingMerger/Acquisition or Financing

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Types of IPTrade Secrets- not “publicly available”not “publicly available”

Situations that might give rise to issues Situations that might give rise to issues work for a typical company include:work for a typical company include:

• Same as “Patent” Issues, plus Same as “Patent” Issues, plus • Hire new employees or get new partnerHire new employees or get new partner

• Learn that former Employee sent company Learn that former Employee sent company materials to new employer while still materials to new employer while still working for company working for company

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Securing IP Rights - Directly

-NDA’s/Confidentiality AgreementsNDA’s/Confidentiality Agreements

-Partner/JV AgreementsPartner/JV Agreements

-Assignments/TransfersAssignments/Transfers

-““Work for Hire” and development Work for Hire” and development agreementsagreements

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Securing IP Rights - Indirectly

-In the United StatesIn the United States

-TM, SM, trade dress – USPTOTM, SM, trade dress – USPTO

-Patents – USPTOPatents – USPTO

- Copyrights – US Library of Copyrights – US Library of CongressCongress

-International International

-Treaties (PCT, Madrid, etc.)Treaties (PCT, Madrid, etc.)

-Foreign Gov’ts/LawsForeign Gov’ts/Laws

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Enforcing IP Rights

Investigating claims/potential infringement

Drafting letters of inquiry & “Cease & desist” letters

Negotiating settlements & consent agreements

Prosecuting & defending infringement lawsuits

Stop IP-infringing Imports

• Because of its border control responsibilities, the U.S. Customs Because of its border control responsibilities, the U.S. Customs & Border Protection (“Customs”) is uniquely positioned to & Border Protection (“Customs”) is uniquely positioned to prevent these illegal importations.prevent these illegal importations.

• To be eligible for recordation with Customs,To be eligible for recordation with Customs,• trademarkstrademarks must first be registered with the Principal must first be registered with the Principal

Register in the U.S. Patent and Trademark Office (USPTO), Register in the U.S. Patent and Trademark Office (USPTO), • copyrightscopyrights with the U.S. Copyright Office of the Library of with the U.S. Copyright Office of the Library of

Congress. Congress.

• Registered works can be recorded via Intellectual Property Registered works can be recorded via Intellectual Property Rights e-Recordation (IPRR) online system.Rights e-Recordation (IPRR) online system.

• Trade names, which cannot be registered at the Patent and Trademark Office, take longer to be recorded with Customs.

Trademarks, Trade Names and Copyrights• Once a trademark, trade name, or copyright has been recorded,

Customs has the authority to deny entry to or seize goods that infringe upon the recorded right.

• Domestic value of goods seized for IPR violations in FY2008 increased by 38.6 % to $272.7 million from $196.7 million in FY 2007.

• IPR seizures of products posing potential safety and security risks increased by more than 124%, from $27.8 million to $62.5 million.

• China was the top source country for IPR seizures of infringing products in FY 2008, accounting for 81% of the total domestic value seized. Footwear was the top commodity seized, accounting for 38% of the total domestic value.

Stop IP-infringing ImportsStop IP-infringing Imports

Patents • Customs’ authority to help patent owners protect their rights is

limited by law – and practicality.

• Customs does enforce exclusion orders issued by the International Trade Commission under Section 337 of the Tariff Act of 1930.

• Exclusion orders are issued where the Commission determines that Section 337 has been violated through unlawful, unfair methods of competition or unfair acts involving the importation of goods.

• Once Customs receives a seizure-and-forfeiture order from the ITC, the goods would be subject to seizure.

Stop IP-infringing ImportsStop IP-infringing Imports

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Concluding ThoughtsEvery company has IP assets – though many

don’t adequately protect theirs.

To protect IP assets, companies must Identify, Secure & Enforce IP rights in US and abroad.

A “Proactive” strategy with regard to IP assets is generally much less expensive than a “Reactive” strategy

About CHESTER PLLC

J.F. (Jim) Chester, JD/LL.M, Managing Attorney

www.chester-law.com

info@chester-law.com

877-34-WORLD (TOLL FREE)

214-988-9248

Advise entrepreneurs, start-ups, privately held companies with trademarks, copyrights, trade secret protection, licensing & enforcement and assist companies in commercial transactions in the U.S. and abroad