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Before we dive in, here’s a quick overview on patents and copyrights: a patent protects inventions and designs, like engines or a phone casing, and a copyright protects original artistic and literary works, like songs or books. If you want a little more detailed refresher, be sure to check out our IP Primer from earlier this month.

Here are the basics on patents and copyrights every small business owner should know:

Patents

A patent excludes others from making, using, offering for sale, or importing an invention or design, within a limited territorial scope. If a patent is granted by the U.S. Patent and Trademark Office (USPTO), the patent owner has the exclusive right to make, sell, manufacture, and import the claimed invention or design. This essentially gives the owner a limited monopoly to profit off of their invention.

When people think about patents, they tend to think about protecting inventions, like solar panels and pharmaceuticals. These would be covered under a utility patent, but a patent can protect designs as well.

We’ll wade into the details of a utility patent first, and then highlight how design patents differ.

Utility Patents

A utility patent protects how an invention works – its functionality and structure. A utility patent lasts for 20 years from the earliest filing date with the USPTO, and the scope of protection depends on the claims that are included in the application (i.e. the precise language that defines the technical features).

Requirements for Patent Protection

1. Suitable subject matter
   • Process, machine, manufacture, or composition of matter, or any new and useful improvement thereof
2. Enablement, written description, best mode, and definiteness
   • Enablement: the invention must be described thoroughly in order to “enable” someone else to make the invention
   • Written description: clear and exact so that any person “skilled in the art” could make and use the same
   • Best mode: you must disclose the best mode for carrying out invention
   • Definiteness: claims distinctly what you think is your invention
3. Anticipation/Novelty
   • Must be new and original
   • “Anticipated”: ineligible for patent if every element in claim is “anticipated” or found in single “prior art” reference (Prior Art: any body of knowledge that relates to your invention, such as patents, trade journals, or publications). This means, in effect, that you cannot secure a patent for something that has been done before.
4. “Obviousness”
   • Must be more than modification of prior art
   • Multiple prior art references may be combined to establish obviousness. Something is considered “obvious” if a person who is familiar with the particular industry in which the idea exists would find it obvious to combine one patent with another. Example: if there were a patent for a tent with a Velcro flap, and a separate patent for a zipper, it would be obvious for a tentmaker to make a tent with a zipper flap. Even if no one had ever done this before, the combination is so obvious that it doesn’t rise to the level of patentability.
5. “Grace Period”
   • Application must be filed within one year of first sale or public disclosure by the inventor
   • Note: some countries have no grace period, or grace period is shorter than one year
   • Any sale or disclosure by a third-party before filing date of application completely “bars” or prevents you from getting a patent

Design Patents

A design patent protects how an item looks; more specifically, it protects the ornamental design that is shown in the patent. A design patent lasts only 15 years from the grant date.

Like a utility patent, the scope of protection afforded for a design patent is determined by the claims in the application, but instead of precise technical language, it is determined by “clear” drawings of the item. A new design must meet all of the patent criteria above, but in practice, the issues of “novelty” and “obviousness” tend to be much less restrictive than the legal standards for utility patents.

Filing for a Patent

Unfortunately for small business owners and entrepreneurs, patent rights don’t exist outside of the federal registration system. The patent system follows the “first to file” principle, meaning that the first party to file for a patent for a particular invention or design will own the superior rights (as opposed to trademark rights, which are earned by use).

The USPTO does have a “micro” business tier fee option: $400 to file, $250 to issue. The examination process generally takes about 13 months from filing for a design patent. For a utility patent, it generally takes 18 months for you to receive the first office action, and 30 months by the time the patent is issued.

Copyrights

A copyright protects an author’s right to profit from works they create. Similar to a patent, the owner is granted a limited monopoly, but a copyright lasts for the entire life of author plus 70 years.

What Can be Copyrighted?

Copyrights cover “original works of authorship.” This includes:

1. Literary works
2. Musical works, including any accompanying words
3. Dramatic works, including any accompanying music
4. Pantomimes and choreographic works
5. Pictorial, graphic, and sculptural works
6. Motion pictures and other audiovisual works
7. Sound recordings; and
8. Architectural works

Copyrights don’t extend to ideas or procedures.

No matter which of the eight categories your work falls into, there are two fundamental criteria you must satisfy in order to qualify for copyright protection:

1. Originality

• Produced by author’s own intellectual effort (not copied)
• Doesn’t have to be novel, but work must represent appreciable amount of creative authorship

2. Fixation in tangible form, which means that the work must be applied to something like paper, the internet, a CD, film, a microchip, a canvas, etc.

Registering a Copyright

The good news is that, similar to trademarks, copyright exists from the moment your work is created, and no governmental registration is required. Unlike trademark registration, however, copyright registration is relatively painless – it costs as little as $35, and the process is reasonably straightforward.

When a work is copyrighted, the owner enjoys the right to:

1. Reproduce the work
2. Prepare derivative works based upon the work (Derivative Work is any new work that is based on preexisting works. It may include a new project in which a work is recast, transformed, or adapted – translations, musical arrangement of a prior recording or song, motion picture adaptions, or a prior book. The adaptation derives from or is a derivative work of the book. It also includes editorial revisions, annotations, and other modifications that, as a whole, represent an original work of authorship).
3. Distribute copies of copyrighted work to public by rental, lease, or lending (shouldn’t “sale” be another option?)
4. Perform copyrighted work publicly (for literary, musical, dramatic, motion pictures, and other audiovisual works)
5. Display the copyrighted work publicly (for audiovisual work)
6. Perform the work publicly by means of a digital audio transmission (for sound recordings)