and issues for netpreneurs:
intellectual property 101
page three of four |
the audience: q&a
Mr. Sherman: This is your chance to interact with
three or even four lawyers without getting billed for it in any
way, shape or form. That's a real testimonial to the great work of
the Morino Institute and netpreneur.org. We have a few questions
already turned in, so I'll start with those. The first question
is: Can you trademark a url?
Mr. Fingerhut: The answer is yes, if it's used as a
trademark. That depends upon how it shows up on the Web page and
whether or not you're actually rendering services under that domain
name. The trademark office generally doesn't accord any distinguishing
significance, however, to the generic top level domain—the .com,
.net .org, etc.
Mr. Sherman: Another question: Is there some form of
interim protection between nothing and a full-blown patent
Mr. Kaufman: Yes. The brief answer is that there's patent
pending protection, which means you have a patent application on file.
This affords you no real legal protection, other than putting others
on notice that you consider the particular subject matter to be
proprietary and expect to achieve patent protection at some time. This
often has a chilling effect on others going ahead and copying that
particular subject matter. You can achieve patent pending status by
filing a formal patent application. That can be relatively expensive.
You can also do it by filing what is known as a provisional patent
application, one that has very few formal requirements and doesn't
require patent claims. Claims are the portion of the patent that
actually define the metes and bounds of the invention. They are
difficult to draft and thus can be very expensive to prepare. Often,
in the case of business methods, your business plan can be submitted
to the Patent Office as a provisional patent application.
There are two caveats, though. Number one, the provisional patent
application will never become a patent and will, in fact, become
abandoned one year after filing if you don't follow with a
non-provisional patent application. In the meantime, however, you will
have patent pending status for what that's worth. The other caveat is
that when you file a non-provisional after a provisional, you can
obtain the filing date of that provisional patent application which
gives you procedural advantages, but only to the extent that the
provisional application disclosed what you are claiming. Again, these
claims are the legal part of the patent application that define the
invention. You get the date of the provisional only to the extent that
the provisional supported these claims fully. So, in order to ensure
that, you or your attorney need to put some thought into what you're
going to claim. That takes away some of the economic advantages of a
provisional patent application.
Mr. Sherman: To build on one topic we didn't really
talk about much this morning is, can you weigh in on trade secrets
as another method to protect a concept or idea?
Mr. Kaufman: As I mentioned earlier, trade secret is a good way
to do that. There are two primary requirements. In the case of a
business method, number one is that it provides you some commercial
advantage over your competitors, and, number two, you have to maintain
its secrecy. That doesn't mean total secrecy, however. You can tell
others on a need-to-know basis under a confidential disclosure
agreement, but, generally, every disclosure has to be with the
understanding that it's confidential.
Trade secret protection can be very powerful, however, one
limitation is that reverse engineering is a defense to trade secret
appropriation. That means that if somebody comes up with the same
business method you have by looking at your results and without access
to your proprietary material, they can appropriate the trade secret
either through reverse engineering or if they invent it independently.
Mr. Sherman: If you register a .org or .net url, and
cannot get the .com, what exposure do you have from whoever has
the .com? Also, how many different classes of use should you claim
in the trademark application?
Mr. Fingerhut: The answer depends upon what type of activity is
being undertaken at the .com address. Is it like the West Coast Video
case where the .com owner is simply sitting on the domain name and
doing nothing with it? In that case, it's not generating any trademark
rights so there shouldn't be anything to worry about. If there is an
active Web site, however, take a look at what type of business is
being conducted and how much public recognition the company has. If it
was Amazon.com and Amazon.net just happened to be available, I would
say that's probably not a good idea. Amazon.com, at this point, rises
to the level of a famous mark. If it's just some company you've never
heard of and your .net business is something different from the
commercial activity taking place at the .com site, traditional
trademark analysis would apply and you'd go through a "likelihood
of confusion test." You'd examine the differences in the
businesses, the differences in the customers, the strength of the mark
and all the regular factors that go into that type of analysis. It
really depends on what's happening at the .com.
Mr. Sherman: Here's a timing question. "We
launched our Web site, RapidRegistration.com,
about a year ago. Can we still go for patent protection for the
Mr. Kaufman: That depends on whether it was more or less than a
year ago. A person ordinarily has a one-year grace period from the
time of their public disclosure to file a patent application in the
US. Let's assume for a moment that a Web site is a public disclosure
and that it tells enough about the method to enable someone to use it
, that it's out there for the world. You can still file a patent
application if it's within one year of when the site became public.
Whether the site is a public disclosure or not is a factual
determination. The problem here is that in virtually every other
country in the world, the one year grace period doesn't exist. If it
is, in fact, a public disclosure, most likely you've waived your
rights to foreign patent protection.
Mr. Sherman: Are proper names of people covered
under the anti-cybersquatting legislation you mentioned?
Mr. Fingerhut: Yes, they are. Under the anti-cybersquatting
legislation, any person with a name can take action. Brad Pitt, for
example, already filed a lawsuit under that statute. The person's name
does not have to be used as a trademark. There was some concern in the
Clinton administration initially when the bill came across that they'd
be creating a federal right of publicity, but the law got signed
Ms. Shack: Good morning, I'm Ann Shack with FreeTrip.com.
If you have a trademark registered in the US and someone wants to
register the same mark in a foreign country and take it global, is
that company precluded from interfering with your US trademark
Mr. Fingerhut: Trademark rights are territorial. A trademark
registration in the US gives you absolutely no protection in Germany,
for example. A German company could, if it filed an application or
obtained trademark registration in Germany, go to other countries
throughout the world where you hadn't gone (we're assuming the
businesses are identical or at least related and the names are
identical). That actually happens quite frequently. You would still
hold the trademark in the US, assuming they hadn't made any usage
here. Remember, however, you're talking about a global medium, so it
presents interesting issues.
Mr. Jacobson: My name is Jim Jacobson with ConsciousMedia.com.
A lot of people have problems with the word "conscious,"
so we registered all the different ways of misspelling it. Is that
necessary with the new legislation? Also, is it important to get
the .net and .org or does the legislation protect you there also?
Mr. Fingerhut: Starting with the second question because the
answer may be easier, I always counsel clients that if the .net and
.org are available, you'd be well advised to get them for the $70 that
it costs to register each of those domain names. In many ways, the
distinction between .com and .net is becoming illusory, so that's
certainly a good idea. Of course, it begs the question as to whether
or not you want to go to the next level and register in some of the
more popular country code top level domains in jurisdictions where you
think you're going to use the mark—assuming there are no legal
presence requirements that prohibit you from those codes.
On the first question, if you're concerned about some type of bad
faith activity, and assuming that ConsciousMedia.com would be regarded
as a distinctive mark, the anti-cybersquatting legislation
would afford you some level of protection, at least in the US. If,
however, you're just trying to cover your bases and you think that
some of your customers don't know how to spell your name, it might
serve you some additional protection to have variations of the domain
names registered. That touches on a related topic, which is: Do you
register potentially derogatory expressions of your name like
ConsciousMediaStinks.com or any of the other variations? Many
companies choose to do that. It's not inexpensive and those who are
trying to make their speech known to the world will find a way to do
it regardless of what you come up with, but there are some obvious
ones that you may want to register.
Mr. Jacobson: What's the disposition of the
Amazon.gr case in Greece? Is that similar?
Mr. Fingerhut: You mean "Greece's biggest book
store?" About seven or eight months ago, a Greek company reserved
the domain name Amazon.gr (.gr is the country domain for Greece) and
was touting itself as "Greece's biggest book store." It
wasn't just a name issue; they had copied the entire look and feel of
the Amazon.com Web site. When you went to their site, you thought you
were dealing with Amazon.com. The Greek company, however, for whatever
reasons, had incorporated in Wilmington, Delaware, so that gave rise
to US jurisdiction. Amazon.com filed suit and the case eventually
Mr. Sherman: Suppose two companies are negotiating a
joint venture. One has the idea for the software and the other has
the tools to develop it. Which one gets to keep the IP and how do
you best structure that deal?
Mr. Capuano: The short answer is that the joint venture gets to
keep the IP. The way we set up our joint ventures in Europe, we're
both bringing distinct talents and property. Proxicom has certain IP
associated with having built 800 Internet applications to date. In the
case of Ericsson,
our joint venture partner in Rome, they're bringing certain
technologies such as wireless. We're both bringing disparate IP, but
the whole idea is to grow the joint venture, so we agreed that the
joint venture would own any IP associated with the deliverables we put
out. Obviously, we each have an equity stake in the joint venture.
Mr. Kaufman: There is something I see happening all the time
that is a huge mistake. In the US, inventors generally own the rights
to the patent. They own the patented subject matter regardless of who
they work for or who they're developing it for, absent some
contractual obligation to assign the invention. You have to make sure
that anybody who is working on potentially patentable subject matter
has an employment agreement or other agreement that obligates them to
eventually assign the rights of the subject matter to the company or
to whoever you want it assigned to. That can be fashioned any way you
want, but some companies run without these agreements. They have an
invention that looks like it's going to be huge, the employee has left
the company or gets wise and says, "Hey, wait a minute, I'm the
inventor here and I own this." They can hold you hostage, and it
can be a huge problem.
Mr. Capuano: Marc's making a very good point. The standard
operating procedure for every company should be to have a one-page
assignment agreement that basically assigns to the company any and all
inventions, work product, etc., that are developed. Frankly, ours is
pretty broad—while you're an employee of the company, whether you're
at work or at home—so we don't have any issues with that. Marc's
point is right on, especially when you get into more complicated
structures down the road, like joint ventures. It should be something
that every company has.
Mr. Presant: Hi. Jim Presant, ExciteYourSite.com. In
protecting a url business name, how much protection do you get if
you put the trademark symbol (™)? What if you have a couple
checks proving income from interstate commerce? What's the next
best investment? Do you try and get the .org and the .net?
Trademark the .com? Do you have exposure if somebody gets a
trademark on the .com without the url?
Mr. Fingerhut: On your first question, in the US you acquire
trademark rights by virtue of your use. The "™" symbol
doesn't give you any legal protection in and of itself. It's just a
notice that tells the world that you're claiming trademark rights in
this particular slogan and it may ward off some people from trying to
trade on that reputation. Even without a registration, you can always
prove your common law rights. Basically, you have to prove to a court
that your customers know that this is your trademark.
Regarding whether you have revenue, the requirement to get federal
trademark protection in the US is that you have to be using your mark
in some type of commerce that's regulated by Congress, whether that's
interstate commerce, territorial commerce or commerce in the District
of Columbia. Many times a trademark lawyer will ask his or her client
for documentation of their first interstate use; however, you can
acquire trademark rights simply by virtue of your use even in the
absence of federal registration. It's just that the registration
constitutes prima facie evidence of the validity of the mark, and
that's significant. It's one thing you don't have to prove when you go
to court and try to sue somebody.
To the question about obtaining trademark protection for .net or
.org when you are a .com, the Trademark Office only gives trademark
protection to marks that you're using. If you are XYZ.com and that's
how your mark shows up on your Web site, the trademark office
is not going to give you a federal registration on XYZ.net because the
mark doesn't appear that way. Typically, in that situation you
purchase the other urls so your customers can find you when they type
.net by accident.
Mr. Morse: I'm Brian Morse with GlobeStreet
Consulting. What if you have a standard distribution agreement
giving limited license for your information to someone who's going
to display it on another platform? For example, I sell my
information from my database to Yahoo!, and they show it via the
Web on a wireless platform. Who owns the rights to that page?
Mr. Capuano: Since it's a license, you retain ownership of the
content. Yahoo! owns the surrounding page and frames, etc. You
retain copyright to the content contained therein.
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