The SCORE Small Business Success Podcast features interviews with the best and brightest in the world of small business, covering topics such as business plans, financing, marketing, human resources, SEO, social media and more. In this podcast, SCORE mentors chat with Joseph Long about intellectual property.
Dennis Zink: Scott, what exactly is Crowdfunding?
Dennis Zink: What are the different types of intellectual property and how do they differ?
Joseph Long: Joe is fine. There are four basic types of intellectual property. There are the copyright, trademark, patents, and trade secrets. Copyrights are rights and original works and creative expressions held by their creator. Ideas and discoveries aren't generally protected by copyrights, but the way in which they are expressed may be. Trademarks are names or designs that identify a product or a service as being from a particular provider; examples might be McDonald's or Ford Mustang. Patents protect ideas or inventions. The rights are held by the inventor, and the rights are to prevent others from making, using, selling, or importing the invention. Trade secrets are generally confidential information controlled by the owner for their benefit. A popular example is the formula for Coca Cola.
Dennis Zink: How should a business protect its copyright interests?
Joseph Long: A work is protected under copyright the moment that it's created and fixed in a tangible form. Examples of tangible work may be drawings, physical models, graphic designs, written text, photographs, videos, or computer code. In general, registration of copyrights is completely voluntary; however, you have to register your copyright with the government if you wish to bring a lawsuit for copyright infringement. It's worth mentioning that a lot of people speak of the poor man's copyright, which is a practice of sending a copy of your work to yourself. There is no provision in any copyright law regarding this protection. It's generally not suitable or as any type of substitute for registration.
Generally, only the author or creator of a work has a rightful claim to its copyright. An important exception to this is a notion of works made for hire. When a work is made for hire, an employer is considered the author, even if an employee actually created the work. Employment are contractor agreements, or contracts, generally including explicit agreement that works created as part of a work for hire are the rights of the employer. A business should seek to retain the copyrights to all materials generated in relation to its products or services through such agreements.
Fred Dunayer: So, an employer would have an agreement with an employee at the time that the employee is hired to explicitly define the ownership of any works produced by that employee?
Joseph Long: That's right. Generally there's an IP (Intellectual Property) component to an employment agreement, would state that any created works generated as part of the employment would be retained by the employer.
Fred Dunayer: But it is implicit, even if it's not in the agreement?
Joseph Long: It is, but it can be a bit complicated when you're talking about an employee versus a contractor, so it's best to make it explicit. This is particularly true with hiring contractors to develop software code, because that can be protected by copyright and generally a business wants to retain those.
Dennis Zink: That's interesting. I recently started writing a business column for the daily newspaper on a weekly basis, and it was very clear that they owned the copyright, they can reproduce it in any fashion, and I get paid nothing no matter what they do with it down the road; and having been a publisher myself, what we used to simply do is put copyright © with the year, and then, "All Rights Reserved." Does that cover a work in a magazine, for example, or a newspaper?
Joseph Long: That's acceptable for providing notice to the public. You actually needn't even do that. The copyright is, as we said, it exists the instant that the work is put in a tangible form. Putting others on notice that someone else owns the copyright is always a good idea, along with other intellectual properties, such as trademarks and patents, notification is useful.
Dennis Zink: Then I recall we used to send in a form to the government, and it wasn't for every issue, but it would be for maybe once a year; is that the proper way of doing that?
Joseph Long: There is a registration process that can go on with the government to register copyrights and while it's voluntary and not necessary to establish the copyright, it is required before you try to do any litigation with the copyright.
Dennis Zink: How should a business protect its trademarks?
Joseph Long: Rights in a mark can be established simply based on using the mark in commerce without having to register it, however, much like with copyrights, federal trademark registration can provide a lot of various legal advantages. When you merely claim the rights to a mark you can mark it with a symbol "TM," as you're probably familiar with, often applied as a superscript. This is a designation to, as we say, put the public on notice or to alert the public that one is claiming ownership of the mark.
Regardless of whether you'd ever file an application, you can use this TM designation. However, you can only use the federal register trademark symbol, which is a capital R in a circle, after the United States Patent and Trademark office has actually registered the mark, which is done by filing an application and going through a small procedure. The purpose of a trademark is to prevent an unapproved source from providing a good or service in a way that might confuse the consumers as to who the actual source is. Accordingly, a business that's operating with a trademark should always seek to protect the inappropriate use of the mark by others to retain its value.