Go to Top

Got Intellectual Property?

If asked if your business has Intellectual Property (IP) and the answer is “I do not know” or “I doubt it,” you are not alone.

Initially many start-up businesses focus on creation and inception tasks: forming an entity; reserving a domain name; signing up for online accounting services or hiring an accountant; and, in some cases, consulting with a business lawyer. Solo inventors or creators generally wear all the hats and adopt the DIY mode of operation without consulting anyone.  This may be putting your assets at risk.

IP is a not just a legal issue

Properly identified and protected IP increases the financial value of your company.

IP rights give businesses a competitive advantage: excluding competitors from a market; creating a revenue stream from licensing or cross-licensing; improving the market’s perception of a product or brand; or in some cases using the IP offensively to request injunctions, sue for damages, or prevent counterfeit knockoffs.

IP is a strategic business issue. For example, IBM generated US$1 billion licensing technologies that are unrelated to its core business in the 1990s.

Many are surprised to learn that Texas Instruments’ licensing revenue from unused patent rights is more than the regular income from its products.

Trademark and Copyright defined

The old adage that ‘a little knowledge is dangerous’ can easily apply to IP. Trademark or service mark and copyright are often ignored at startup and sometimes confused or used interchangeably.

The United States Patent and Trademark Office (USPTO) defines a trademark as:

… a brand name. A trademark or service mark includes any word, name, symbol, device, or any combination, used or intended to be used to identify and distinguish the goods/services of one seller or provider from those of others, and to indicate the source of the goods/services. (emphasis added)

The goal of the trademark is to protect consumers from brand confusion. In other words, the product is tied to a particular brand.

When you buy a Pepsi product, you are guaranteed that it is Pepsi brand, not a generic store brand cola or Coke product.

The United States Copyright Office defines copyright as:

…a form of protection grounded in the U.S. Constitution and granted by law for original works of authorship fixed in a tangible medium of expression.

Once you type, draw, write, text, or otherwise create so that someone can see it, i.e., video, you have “fixed in a tangible medium of expression” and have copyright protection.

For example, the words in this article are protected by copyright as they are typed and appear on the computer screen. It can be confusing because a slogan, when typed or displayed in an advertisement, is protected by copyright but also can be trademarked. However one is not a substitute for another.

Use it first and prove it!

Suzanne, a US businesswoman, learned a difficult lesson about building a brand without first using or securing trademark. She formed a Limited Liability Company (LLC) using the brand name but did not register that name with the state or with the USPTO.

When Suzanne attempted to trademark her brand name with the USPTO, she was surprised to see a very similar trademark application in progress. Unfortunately, the previous fall she had disclosed her brand name to the same group who filed this particular trademark application.

In the US, if the brand or name is used in commerce, the “TM” can be placed after the name. Then, the business has common law trademark rights on that date of use without filing with the State or USPTO, as long as the continued use in commerce can be demonstrated.

If a business is not yet using the brand or name in commerce, an“intent to use” application can be filed with USPTO and in essence reserve the name or brand. In both instances, you need to check if someone else has a trademark rights for that name before starting to use the mark.

In Suzanne’s case, she had first used the brand in the fall during early advertising for her company. Unfortunately that use did not predate the date of the first use in commerce filed by the rival applicant. Otherwise, Suzanne could have demonstrated that she was using the brand name in commerce before the other organization. She then would have had grounds to challenge the rival trademark or file her own trademark application with an earlier date of use.

The takeaway is that the time to file a trademark was when Suzanne conceived the brand, and definitely before telling others about her concept and brand name.


A guest blog by Mary Juetten, Founder of Traklight.com  

For great insights on why having no capital can be a good thing, read on.

photo credit: B Rosen via photopin cc