There are a few simple things you can do as a business owner to protect your Intellectual Property (IP) and avoid the common mistakes. Knowledge is key so you can plan accordingly and take the right steps to maximize and protect your valuable IP.
1. Failing to federally register your brand
You are starting a new business providing services or products locally. You create a catchy brand and logo. Your business takes off and you are a viral hit! Now you are doing business throughout the entire Southeast. A competitor copies your brand and starts using it in California for identical services/products. What can you do? Well, if you only have common law rights in the Southeast and have no presence in California, there may be little you can do.
But, if you had applied for and received federal protection of your brand through the United States Patent and Trademark Office (USPTO), you have constructive use of your brand throughout the United States as of the registration date. In that situation, you would likely be able to stop the infringer, or if desirable, negotiate a license for the company to use your brand on the West coast. It is important to protect your Intellectual Property early in the process so you can stop potential infringers and minimize the impact/damages to your business from copycats.
2. Waiting too long to file for patent protection
Often potential clients tell me that they started selling their products more than a year ago. This is one of the most frustrating aspects of my job as their invention is now in the public domain. An inventor/applicant must file for patent protection within one year of any sale, offer for sale, or public disclosure of the invention. This is called a statutory bar deadline, which is not extendable. In some cases, the inventor/applicant may still seek protection for improvements on their invention that occurred within the one year timing, but the underlying invention that was sold more than one year prior is now in the public domain.
It is important to meet with a patent attorney early in the process. That way you can learn about critical dates and timing considerations as you develop your invention and decide how to best protect your invention. By understanding the patent process, you can make educated decisions about when or if you want to seek patent protection. If do not not have that information, you could be unintentionally giving up your patent rights.
3. Getting a written copyright assignment when hiring an artist/graphic designer
A common misconception is that when you hire and pay an artist to create your logo or a photographer to take pictures, you own the copyright interest in the work prepared. Not true. If you hire an independent contractor to create the graphic and don't get a written assignment of the copyright interest, you are left with an implied license to use the graphic. If you are using it as a brand, you don't have ownership in the logo to apply for federal trademark protection. To properly own the copyright interest, you must secure a written copyright assignment from the artist.
In some cases, a company uses an employee to create the graphics. If the employee creates the graphic in the scope of their employment, the artist is automatically the employer company (not the employee). Knowing how to properly secure your Intellectual Property rights is critical. Otherwise, you may not even be aware that you have minimal or no rights in what you thought was your Intellectual Property.
4. Recording your Trademark and Copyright Registrations with U.S. Customs and Border Protection
You secured a trademark registration from the USPTO, congrats! Now what? Take a few minutes and record your trademark registration with U.S. Customs and Border Protection (CBP). Why? Let CBP help you enforce your trademark rights with products imported into the country.
If you record your trademark (or copyright) registration with CBP, they will cross reference branded products crossing the US border against the CBP database. If there is a hit, CBP will freeze the products at the border and notify you as the registrant to confirm if they are your products or if you authorized the import of products that use your brand. This is a great tool that is often overlooked. Why let the products hit the market when CBP can freeze them at the border?
5. Not using an Attorney to Protect your Intellectual Property
For most start ups and independent entrepreneurs, budget is a primary consideration. Most business owners know they need to protect their IP, but often do not prioritize the budget to hire competent counsel to navigate the application processes to secure the applicable registrations. This can be fatal to your IP protection years down the road. Compared to patent applications, trademark and copyright applications are not overly complex for applicants to prepare on their own. However, knowing what and why certain information goes into an application can be critical to maintaining the validity of your rights.
For example, you prepare and file a trademark application for the brand ABC, owned by the ABC Company. You state in the trademark application that the brand ABC was first used in commerce on January 1, 2022. That is the date your formed ABC Company with the state. But you started selling products with the brand ABC on June 1, 2022, six months later. The sworn statement you made to the federal government was inaccurate. The USPTO is unlikely to catch the issue as they accept your sworn statement. But when you enforce your trademark registration against an infringer harming your business, it may be grounds to invalidate your trademark registration. Then you are left with common law rights. An attorney will ask questions so you understand the legal implications of your answers in a trademark application.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.