What is intellectual property?

Written on:February 22, 2013
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Generally speaking, “intellectual property” refers to property which is created by the mind, in contrast with real property (e.g., land) or personal property (e.g., equipment). As defined by Article 2, section (viii), of the Convention Establishing the World Intellectual Property Organization, done at Stockholm, July 14, 1967, “intellectual property” includes the rights relating to: literary, artistic and scientific works, performances of performing artists, phonograms, and broadcasts, inventions in all fields of human endeavor, scientific discoveries, industrial designs, trademarks, service marks, and commercial names and designations, protection against unfair competition, and all other rights resulting from intellectual activity in the industrial, scientific, literary or artistic fields.”

Intellectual property can generally be divided into four categories:  1) patents; 2) trademarks; 3) copyrights; and 4) trade secrets.

A patent for an invention is the grant of a property right to the inventor, issued by the United States Patent and Trademark Office (USPTO). The right conferred by the patent grant is “the right to exclude others from making, using, offering for sale, or selling” the invention in the United States or “importing” the invention into the United States for a limited time in exchange for public disclosure of the invention when the patent is granted. Patents are territorial in that patent protection must be applied for in each country where protection is sought.

A trademark protects words, names, symbols, sounds, or colors that distinguish goods and services from those manufactured or sold by others and indicate the source of the goods. Trademarks, unlike patents, can be renewed forever as long as they are being used in commerce. Registration of a trademark is not required in the U.S., although there are benefits to obtaining a Federal trademark registration through the USPTO. Trademarks are territorial; unlike the United States, most countries require registration of trademark rights.

A copyright is a form of protection provided to the authors of “original works of authorship” including literary, dramatic, musical, artistic, and certain other intellectual works, both published and unpublished. A copyright protects the form of expression rather than the subject matter of the writing. The U.S. Copyright Office handles copyright registrations. Owners of copyrighted works seeking protection in other countries should first determine the extent of protection available to works of foreign authors in that country.

Generally, a trade secret can include a formula, pattern, compilation, program, device, method, technique or process that is used in one’s business, and has independent economic value that provides an advantage over competitors who are not aware of it or use it. Under most circumstances, a trade secret is lost once it is independently discovered.

What kind of protection I should apply for? What types of things can be patented, trademarked and copyrighted?
Different types of intellectual property are protected by different means. In the U.S., patents may be available to any person who “invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof.” Patent protection must be sought by application with the USPTO. Trademarks protect words, names, symbols, sounds, or colors that distinguish goods and services from those manufactured or sold by others and to indicate the source of the goods. Registration with the USPTO is not required, but does provide certain advantages. Copyrights protect original works of authorship, including literary, dramatic, musical, artistic and certain other works, both published and unpublished. In the United States, the U.S. Copyright Office handles copyright registration that, although not required for protection, does confer advantages.

How long does patent, trademark or copyright protection last?

A U.S. utility patent is granted for 20 years from the date the patent application is filed in the US; however, periodic fees are required to maintain the enforceability of the patent. U.S. trademarks can last forever, as long as the trademark is used in commerce and defended against infringement. Copyright protection is for a limited term. For works created after January 1, 1978, copyrights last for 70 years after the death of their owner.  For works made for hire (covering the usual type of work owned by a small business), the copyright lasts for a term of 95 years from the year of its first publication or a term of 120 years from the year of its creation, whichever expires first.

How are IP protection laws enforced?

Most intellectual property law in the United States is Federal law, giving the Federal courts exclusive jurisdiction to handle patent and copyright cases, and those claims brought under the Lanham Act (trademark and unfair competition). Under U.S. Federal law, patent, copyright, and Federally registered trademark rights holders have civil remedies available to them for infringement of their rights. This normally involves the filing of a civil action by the right holder in a Federal district court and the subsequent adjudication of the case in Federal court.

Although the majority of IP enforcement in the United States is carried out through private civil actions, there are also IP offenses and penalties in State and Federal criminal codes. Criminal prosecutions often result from referrals by the right holder to the investigative agencies including the Federal Bureau of Investigation and U.S. Immigration and Customs Enforcement, or to Federal prosecutors in the U.S. Attorneys’ Offices or the Department of Justice. The assistance of the right holders in cases of commercial-scale copyright piracy, trademark counterfeiting or the theft of trade secrets is often invaluable to a successful prosecution. Criminal IP investigations are also initiated based upon evidence developed directly by prosecutors and investigators, particularly in cases involving large-scale online copyright violations.

There is no Federal agency that is directly responsible for administrative enforcement of intellectual property rights, except for U.S. Customs and Border Protection, which is authorized to enforce intellectual property laws at the nation’s borders. Intellectual property owners may seek to have infringing imports stopped at the border, by recording a copyright or trademark registration with Customs, obtaining a court order to detain and seize shipments, or by obtaining an exclusion order from the International Trade Commission which is in turn enforceable by Customs.

State law remedies may also be available for certain acts of unfair competition or unfair trade practices under state laws, or claims based on common law trademark protection.

Like the U.S., each country has its own system for enforcing IP rights.

How can I protect my business from IP theft?

The first step in protecting your business from IP theft is to protect your IP – both in the United States and in other countries where you do business and source products. Most IP rights are territorial, meaning, for example, a U.S. patent or trademark only provides protection in the United States. To receive IP protection in other countries, one needs to apply for protection in those countries.

Do I need to file for protection overseas?

If you plan on selling or distributing or sourcing your products abroad, you should consider registering or filing with each country’s intellectual property authorities.  Filing for protection may not be appropriate for every business. The circumstances for determining what type of IP protection is best for your business may be complicated and differ for each individual business. Furthermore, international protection can be costly.  Some issues to consider when making this decision include:

  • Will I be conducting business outside the U.S.?
  • Do I think I will ever export my product overseas?
  • Do I think I will ever manufacture my product overseas?
  • Can I afford international IP protection? If so, in what markets would my product most likely be commercially sold?
  • What forms of IP are available to me?

It is important for businesses to keep in mind that certain actions may bar certain types of protection, so the earlier a business considers IP protection, the better. If a business is interested in seeking patent protection in many countries, it may be beneficial to consider the Patent Cooperation Treaty (PCT), which is an international filing mechanism that permits an applicant to file a single patent application that acts as if an application was filed in 126 different countries; however, examination under the PCT must be requested by the business in each individual country in order to be granted a patent in that country (with limited exceptions). Also, if a business is interested in seeking trademark protection in a number of countries, it may be beneficial to consider filing an application under the Madrid Protocol, which offers one-stop-shopping for seeking trademark protection in more than one Member country.