How to Protect Your Business With Copyrights, Patents, Trademarks, Trade Secrets

How to Protect Your Business With Copyrights, Patents, Trademarks, Trade Secrets

For many new entrepreneurs, intellectual property falls under “I didn’t know what I didn’t know.” But never fear!

At Global Entrepreneurship Week Kansas City, Kyle Mendenhall of Hovey Williams LLP shared the basics of intellectual property. It’s an area that all business owners need to understand, and Kyle made the information easy to digest. Here’s what you need to know about patents, trademarks, trade secrets, copyright and contracts and how you can leverage them to work in your small business.

What is intellectual property and why is it valuable?

What might seem like a big, scary term is actually pretty simple.

“Intellectual property is creations of the mind,” Kyle says. “This includes inventions, literary and artistic works, symbols, names and images used in commerce.”

In other words, intellectual property is what makes your venture special. It’s the big ideas and the unique markers that make your organization stand out. And it’s important.

Intellectual property can help attract investment and increase valuation. When you protect it properly, you can deter copycats and chill the competition. Secure intellectual property can also create licensing and cross-license revenue opportunities. Bottom line: Intellectual property is your business’s bread and butter.

How can I protect my intellectual property?

There are five ways to legally protect intellectual property:

· Patent
· Trade secret
· Trademark
· Copyright
· Contract

Each of these modes of protection are designed for specific situations. It’s important to use the one that best fits your intellectual property.

More info below …

What do patents do?

Patents protect inventions, like processes or machines. There are three types of patents:

Utility: This is the most common type of patent. It protects the functional aspects of an invention. The invention must be a new composition, device, technique process, software or new use for an old thing. From the time you file, this patent lasts 20 years.

Design: This protects the design but not the functional aspects of an invention. It protects the ornamental design, like the shape of a Coca-Cola bottle. Design patents granted after May 13, 2015, protect for 15 years.

Plant: When you’re creating asexually reproducing plants, this patent is for you.

If a patent is right for you, here are a few things you should know:

Process: “A provisional application is like a flag in the sand,” Kyle says. It’s usually the first recommendation and comes with minimal requirements for filing. Provisional protection expires after 12 months.

Once proof of concept is almost finished, it’s time to file a nonprovisional application. This application will be examined and may result in a patent being issued. Here’s the overall process:

Intellectual Property Basics

Cost: In the U.S., patent protection comes at a cost. In most cases, you can expect to pay:

– Provisional application: $1,000 – $4,000+
– Preparation and filing of a nonprovisional application: $8,000 – $15,000
– Examination: around $5,000, depending on the examiner
– Issuance: fees of around $1,000 – $2,000

Maintenance fees are also due periodically during the life of the patent.

International protection: There’s no such thing as an “international patent.” However, you can file in specific countries based on the Patent Cooperation Treaty (PCT) application. International protection depends on the specific country. Filing fees can run up to $10,000, and examination can add more than $5,000 on top of that. Annual maintenance fees of $500 to $1,000 per country can accrue while an application is still pending.

What are trade secrets?

This is confidential information that has economic value. Trade secrets can include formulas, customer lists or manufacturing processes.

The business must be working to maintain these secrets. That means security from outsiders and confidentiality agreements with insiders. Locks, use of paper shredders and encryption of sensitive information is important. Contracts and sharing information on a “need to know” basis is useful, too.

In 2016, the Defend Trade Secrets Act (DTSA) created a federal civil cause of action for misappropriation of trade secrets. This law has a three-year statute of limitations.

What do trademarks do?

Trademarks indicate that an asset is used in commerce. You can also think of a trademark as something that’s associated with a brand. The Nike logo, NBC’s chimes and McDonalds’ “I’m lovin’ it” slogan are all trademarks. Trademarks must be distinctive—so while you can’t trademark something generic like “cell phone,” the name “Verizon” is a trademark.

The ™ symbol notes a common law trademark, while the ® symbol indicates a federal (national) registration. You can acquire common law trademark rights by using the mark in commerce. This use protection is limited to the geographic region and is enforced via state law. For federal protection, file with the U.S. Patent and Trademark Office (USPTO).

“State trademark coverage can be inconsistent,” Kyle says. “In most cases, you really want federal protection.”

What are copyrights?

Copyrights protect expressions of ideas. Artwork, music, writing, choreography and even software code can be copyrighted. You can immediately note copyright with the © symbol. Copyright includes the exclusive rights to copy, distribute, display, perform and make derivative works.

Some works cannot be protected by copyright:

· Works in the public domain
· Unoriginal reprints of public domain works
· U.S. government works
· Facts, data and ideas

You should register a copyright with the U.S. Copyright Office to show proof of ownership in case copyright becomes an issue in the future. Without registered copyright, your damages may be limited.

How long copyright lasts depends:

For individual authors: For works created in 1978 or after, copyright is the author’s life plus 70 years.

For works made for hire, anonymous or pseudonymous: 95 years from publication or 120 years from creation, whichever is shorter.

For works created before 1978: Duration of copyright varies, based on when the work was created and/or published.

How can a contract protect intellectual property?

Contracts can help ensure confidentiality. But the protection they provide can vary.

“Contracts create your own right for things that aren’t otherwise protectable,” Kyle says. “That’s a little less set down in the law, more nuanced.”

If you’re looking to protect intellectual property that’s not covered by patents, trade secrets, trademarks or copyrights, a contract might work. But you should definitely seek legal counsel.

How can I get help with intellectual property issues?

This is an area where the devil really is in the details. If you have questions about intellectual property, it’s best to talk to an expert.

A good place to start is KCSourceLink’s Guide to Innovation-Led Businesses (aka Tech Startups). The Protect Your Intellectual Property section includes Resource Partners that can help you make sense of copyrights, patents and more. And if you truly don’t know what you don’t know? A Personal Action Plan can point you in the right direction with a free, individualized to-do list to get you on the right track.

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