identifying intellectual property issues in startups 2014

IDENTIFYING INTELLECTUAL PROPERTY ISSUES IN START‐UPS

Presentation to

Illinois State Bar Association

May 27, 2014 9:00 am – 10:30 amPresented by David M. Adler, Esq.

Adler Law Groupwww.adler-law.com

Trademarks, Trade names and Copyright: Protecting

Branding.

April 10, 2023Adler Law Group | Safeguarding Ideas Relationships & Talent® adler-law.com 2

Trademarks & Trade Names

TM -or -

®April 10, 2023Adler Law Group | Safeguarding Ideas Relationships & Talent® adler-

law.com 3

Any word, name, symbol, or device, or any combination, used, or intended to be used, in commerce to identify and distinguish the goods of one manufacturer or seller from others, and to indicate the source of the goods. 15 U.S.C. 1127

In short, a trademark is a brand name.

Registration not required

Benefits: Presumption that registrant is exclusive owner Entitled to use the mark nationwide

Illinois: Trademark Registration and Protection Act 765 ILCS 1036

Source: Article I, Section 8 of the US Constitution

Protects Creative expression: literary, dramatic, and musical works; pantomimes and dance; pictorial, graphic and sculptural works; audio-visual works; sound recordings; and architectural works.

Fixation Protected as soon as it is expressed. Tangible form includes the electronic medium: e.g. a

graphic file saved to disk; a web page saved as a .html file.

Most items on the Internet are protectable: the text of web pages, contents of email and Usenet messages, sound files, graphics, etc.


© Copyrights

©

Copyright BasicsWhat is NOT protectable?

Ideas Facts Titles Names Short phrases/Blank forms

“Work Made For Hire?” Either:

prepared by an employee within the scope of his or her employment, or

a work specially ordered or commissioned by express written agreement

The employer is the author of a work made for hire.


Copyright Basics

Why Register?

Necessary for enforcement.

In order to file a lawsuit

Statutory damages


Trademarks & Service marks Knock-out Search:

search before you file an application confusingly similar marks in the same

category are not likely to be approved USPTO

Neither are generic or descriptive marks. NOTE: Get help from a seasoned

trademark lawyer

Registered trademark owners may seek protection of federal trademark laws Section 32 of the Lanham Act 15 U.S.C.

Sec. 1114 for trademark infringement; Section 43(a) of the Lanham Act 15

U.S.C. Sec. 1125(a) for dilution or unfair competition; or (c) under state unfair competition laws.


STOP!

Trademarks & Domain Names Every web page has its address similar to a

street address commonly referred to as the "domain name.”

Sometimes, a web user will assume that the web address is "trademark.com.” Beverly v. Network Solutions, Inc. No. 98-0337 1998 WL 320829 at 1 (N.D. Cal. June 12, 1998).

Must functions as a source identifier.

Specimens must display domain name in a manner that will be perceived by potential purchasers as indicating source and not as merely a web site address.

In In Re Eilberg, a term that only serves to identify a domain name (Internet address) but does not separately identify applicant's services, does not function as a service mark.


Trade Secrets ITSA 765 ILCS 1065/2(d).

Information (data, a formula, pattern, compilation, program, device, method, technique, drawing, process, etc.)

(1) is sufficiently secret to derive economic value, actual or potential, from not being generally known to other persons who can obtain economic value from its disclosure or use; and

(2) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy or confidentiality.

Axiomatic: in today’s technology-driven business world, largest driver of business value = intangible assets, and among those, trade secrets often confer an immeasurable competitive advantage.


Trade Secrets10 Trade Secret Protection Tips to take from this case:

1.Identify Trade Secrets Early.

2.Treat them like secrets!

3.Have a policy.

4.Use Non-Disclosure Agreements.

5.Provide Employee Training.

6.Classify.

7.Control Access.

8.Computer Device Security (BYOD).

9.Network / IT Security.

10.Have a Plan “B”


Motorola, Inc. v.

Lemko Corp., 609 F.Supp.2d

760 (N.D. Ill., 2009)

Intellectual Property Ownership & Management Tips

One thing I have learned: my clients should have consulted me first!

Identify and document IP and the relationships of those who come into contact with it it is imperative to:• Identify your intangible

assets early• Protect your intangible assets

through registration and contracts

• Leverage your intangible assets strategically


#$%&%$#!!


1. IP Audit – Locate & Identify your IP!

Once intellectual property rights have been identified assure that these rights are properly registered and correctly used.

2. Trade Secrets - Protect them or lose them!

Mark all materials “CONFIDENTIAL”

Shred/destroy

Lock up your outside trash

Guests: sign in & wear “visitor” badges

Enforce computer passwords, cover revealing labels, restrict visitor tours, and lock drawers

Use Confidentiality Agreements with anyone who has access to trade secret info



3. Be VERY Specific When Drafting!

There are no rights in “intellectual property.” Energy Recovery, Inc. v. Hauge, No. 2013-1515 (Fed. Cir. March 20, 2014).

Use Covenants Not to Compete/Solicit

Use “Work-made-for-hire” Language for employees, contractors

Don’t be afraid to use liquidated damages clauses

Term, Termination & Breach


http://www.cafc.uscourts.gov/images/stories/opinions-orders/13-1515.Opinion.3-18-2014.1.PDF


3. Be VERY Specific When Drafting! (Cont.)

Understand Warranties and indemnification obligations

Indemnify

Defend

Hold Harmless

Express language or statutory authority is required for attorney‘s fees to be included as part of the indemnification clause. Downs v. Rosenthal Collins Group, LLC,385 Ill. App. 3d 47, 50 (2008).

An indemnitor generally has no duty to defend, unless the contract or relevant statute specifically requires such defense. CSX Transp. v. Chicago & N. W. Transp. Co., 62 F.3d 185, 191-192 (7th Cir. 1995).
