UTSA Colleges of UTSA Colleges of Business and Business and EngineeringEngineering

October 5, 2013

TAKE YOUR TAKE YOUR TECHNOLOTECHNOLOGY TO THE GY TO THE LIMIT!LIMIT!

2014 Technology Entrepreneurship Boot Camp – Intellectual Property

Sponsored by Jackson Walker

William R. William R. BorchersBorchers

• Partner: Intellectual Property

The University of Texas at AustinThe University of Texas at AustinB.S. in Aerospace EngineeringB.S. in Aerospace Engineering

University of VirginiaUniversity of VirginiaJuris DoctorateJuris Doctorate

ObjectivesObjectives

• Define the term “intellectual property” and describe its importance

• Understand and distinguish the major forms of intellectual property protection

• Develop an understanding of how to determine whether a particular piece of intellectual property is worth the time and expense of protecting

What is Intellectual What is Intellectual Property ?Property ?

• Intellectual property is created by the mind

– Inventions– Accumulations of pertinent data– Writings– Compositions– Drawings

• Four major forms of intellectual property protection

– Patents– Trade Secrets– Trademarks– Copyrights

Why should you protect Why should you protect your IP ?your IP ?

• Protect your innovations/proprietary data from competitors

• Investors will want an IP protection plan

• Protect and build your good name

• Add value to company if ever want to sell

• IP assets can evaporate if they are not protected

• Cost of IP protection is small compared to potential value

• Employee, Customer and Supplier Goodwill

• Common Law Trademark and Trade Secret protection

• Building, Equipment, Inventory

• Registered - Trademarks, Trade Dress, Copyrights

• Patents – Utility, Design, Plant

• IP assignments and noncompetes - employees and contractors

• Formal Trade Secret Protection

• Form contracts - suppliers and customers

ASSETSASSETS

Soft Assets

Hard Assets

Extra Assets

Common Mistakes With Common Mistakes With IPIP

Not properly identifyingall of the

intellectual property

Not fully recognizingthe value of the

intellectual property

Not legally protectingthe intellectual propertythat needs protecting

Not using theintellectual property as

part of the overall plan for success

Types of Types of Intellectual Intellectual

Property Property ProtectionProtection

• Patents -- gives right to exclude others from making, using, selling, or importing the invention

• Trade Secrets/Know How – protects ideas/data if kept secret

• Trademarks/Service Marks -- identifies a unique source of goods or services

• Copyrights -- protects from copying of original works (music, books, drawings, software, databases)

PATENTSPATENTS

PatentsPatents• Definition: A patent is a grant from the U.S. government

allowing its owner to exclude others from making, using, offering to sell, selling, or importing his invention

• No right to practice

• There are three types of patents:

– Utility patents - protect useful inventions– Design patents - protect ornamental designs– Plant patents – protect asexual plant varieties

• Utility patents are the most common

• Any new and useful– Process– Machine– Article of manufacture– Composition of matter

• Improvements on existing things

• Other areas (in flux)– Software– Methods of doing business

What’s What’s Patentable?Patentable?

Three Basic Requirements Three Basic Requirements For Utility PatentsFor Utility Patents

• Generally 20 years from earliest U.S. filing dateGenerally 20 years from earliest U.S. filing date

– Can be extended for delays in USPTO and FDACan be extended for delays in USPTO and FDA– 15 year for designs15 year for designs

• Outside of U.S. – generally 20 years from earliest filing dataOutside of U.S. – generally 20 years from earliest filing data

• Maintenance fees must be paid to keep patents in forceMaintenance fees must be paid to keep patents in force

How long do How long do patents last ?patents last ?

When can you When can you patent ?patent ?

• When it is clear the invention will work

• Conception

– When inventor has completely performed the mental part of the invention ― every feature claimed in the patent application

• Reduction to Practice

– Invention built and sufficiently tested to demonstrate that it will work for its intended purpose

• Reduction to practice not necessary if it is clear from drawings and description that the invention will work

When should When should you apply for a you apply for a

patent ?patent ?• US underwent major transformation in March 2013 with

the America Invents Act (AIA)

• US is now a first-to-file country

• Expands the amount of prior art that can prevent patenting

– You will now be beaten by someone who invents later but files before you

• File as early as possible

Absolute Last Absolute Last Dates to Apply Dates to Apply

for Patentsfor Patents• For U.S. patent: application will be barred if not filed

within one year of the first:– Public use– Public disclosure (e.g., printed publication)– Sale/Offer for sale

• For foreign patents: application will be barred if not filed somewhere before any public disclosure of the invention anywhere

• Best policy: File prior to any public disclosure

Provisional Provisional Patent Patent

ApplicationsApplications• Viewed as inexpensive and quick way to get an

invention on file

• Can follow up with regular application within 12 months and maintain priority date

• Expect to see a rise in use with AIA

• Can be a trap because they must enable the invention to be of effect

Foreign PatentsForeign Patents

• Patents are issued on a country-by-country basis

– A U.S. patent will not stop someone in another country from exploiting the invention

• No “international patent”

– Patent Cooperation Treaty (PCT) only provides additional time to make decision regarding which countries to file in

• In general, pursuing foreign patents is quite expensive, so do so with a clear purpose

• Inventor owns patent unless otherwise agreed

• Shop Right

– Company may get if the inventor used company resources in creating the invention

– Only right to use, not ownership

• Companies should put assignment provisions in employee agreements

Who owns aWho owns apatent ?patent ?

• Can I get a patent ? (Prior art search)

– Compares your idea against what has been already been disclosed

– Searches can be performed relatively cheaply and quickly

– Provides some comfort that a patent is obtainable

• Can I practice my invention ? (Freedom to Operate search)

– Compares your proposed product against other patents’ claims

– More comprehensive and time consuming

– Provides comfort that you will not infringe anybody else’s patent

• Will my patent exclude others from competing designs ?

Should you Should you pursue a pursue a

patent/product ?patent/product ?

A Patent May Have Huge A Patent May Have Huge or Little Commercial Valueor Little Commercial Value

My InventionA. Cup

B. Handle

C. Metal Disc

D. Magnet

PATENTABILITY ANALYSISPATENTABILITY ANALYSISPatentability

OperationInvention

ABCD

Your Description

Novelty subtraction

Leaves

Obviousness subtraction

Leaves

--A

--AB

ABC

ABCD

--ABC

ABCD

Combinations obvious “to a person having ordinary skill in the art” are not patentable (§ 103)

Prior art combinations are not patentable (§ 102)

Combinations novel to your invention

Combination that might be patentable

INFRINGEMENT ANALYSISINFRINGEMENT ANALYSIS

Patent Claim

Claim’sElements

AccusedDevices

PatentInfringement

A

A

AB

ABC

Yes

Yes

Yes

1

2

3

AB

ABC

A

AB

ABC

A

AB

ABC

No

Yes

Yes

No

No

Yes

Claim Value

High value

Moderate value

Low value

ABC … XYZ InventionABC … XY Prior ArtABC … XYZ Patentable

Combination

Everything new is patentable (almost) – if you add enough elements to the claim

SCOPE OF CLAIM 1 WITH ELEMENT ASCOPE OF CLAIM 1 WITH ELEMENT A

High Value A Boundary

Infringements

SCOPE OF CLAIM 2 WITH SCOPE OF CLAIM 2 WITH ELEMENTS A AND BELEMENTS A AND B

Moderate Value

Infringements

A+BBoundary

AB

SCOPE OF CLAIM 3 WITH SCOPE OF CLAIM 3 WITH ELEMENTS A, B AND CELEMENTS A, B AND C

A+B+CLow ValueBoundary

AB

CInfringements

SCOPE OF A CLAIM WITH ELEMENTS A, B, C . . . ZSCOPE OF A CLAIM WITH ELEMENTS A, B, C . . . Z

. Z

Easy to get / but tiny infringement value. No competitors’ accused devices or methods have all elements A,B,C . . . Z

BoundaryA+B+C+Z

AB

C.Z

PATENTABILITY VS. PATENTABILITY VS. INFRINGEMENTINFRINGEMENT

1. Everything new is patentable (almost) - if you add enough elements to the claim.

2. But the more elements needed to get a patent, the less its value (maybe zero) - because fewer accused devices and methods infringe.

TRADE TRADE SECRETSSECRETS

Trade SecretsTrade Secrets

• Definition: A trade secret consists of any information not generally known to others that gives its owner a competitive advantage and for which reasonable steps are taken to maintain its secrecy

• Can be technical or commercial in nature

• Can be useful for data and processes

• Not typically good for products themselves

Patents vs. Patents vs. Trade SecretsTrade Secrets

• Pros:– Patents protect against independent development and

reverse engineering– Trade secrets can protect a broad range of information

and can last a long time (e.g., indefinite)

• Cons:– Patents have a limited life (20 yrs), are more expensive

to obtain, and only protect certain things– Trade secrets are harder to maintain and cannot protect

against independent development and reverse engineering

Trade Secret Trade Secret Protection MethodsProtection Methods

• Physical Measures For Protecting Trade Secrets– Restricting access to confidential material

• Only disclose to need-to-know employees• Force employees and outsiders to execute

NDAs– Labeling documents – e.g., proprietary– Password protecting confidential computer files– Maintaining log books for visitors– Maintaining log books for sensitive material

• Maintaining adequate overall security measures

YOUR TRADE SECRETS ARE ONLY PROTECTABLE IF THE JURY FINDS THAT:

•The items were relatively secret; and

•The defendant knew the items were secret (mark, mark, mark)

Enforcing Trade Enforcing Trade SecretsSecrets

TRADEMARKSTRADEMARKS

TrademarksTrademarks

• Definition: a trademark is a word, name, symbol, device or combination thereof that identifies and distinguishes one’s goods and services from other’s

• Technically, a trademark is used to identify a good or product and a service mark is used to identify a service

Example Example

Name is trademarked

Symbol is trademarked

Slogan is trademarked

What is What is Protectable?Protectable?

Words

Numbers and letters

Designs or logos

Sounds

Fragrances

Shapes

Colors

Trade dress

TYPES OF MARKSTYPES OF MARKS

• Generic – Unprotectable (soda for a beverage or TV for a television)

• Descriptive - May be protectable(such as “Tax Preparation Software” for a software program that enables users to prepare tax returns)

• Suggestive – Protectable(such as Greyhound for bus services and Jaguar for automobiles, with both marks suggesting the speed of their products; 7-ELEVEN for convenience stores)

• Arbitratory or Fanciful - Very protectable(such as Kodak, Starbucks, Verizon, Exxon)

Exclusions from Exclusions from Trademark Trademark ProtectionProtection

• Immoral or scandalous matter

• Deceptive matter– For example, a food company couldn’t

register the name “Fresh Florida Oranges” if the oranges weren’t from Florida.

• Surnames– A trademark consisting primarily of a

surname, such as Anderson or Smith, is typically not protectable.

The Process of The Process of Obtaining a Obtaining a TrademarkTrademark

Establishing Establishing Trademark Trademark

RightsRights• Trademarks rights naturally arise through use of a mark

– Simple use of a mark grants rights in the mark against later uses on similar products in the area of use

– Federal registration, although not required, protects the mark nationwide against later confusingly similar uses

• Trademarks can be reserved before use if there is a good faith intent to use

• Trademark rights can last as long as a mark is used

COPYRIGHTSCOPYRIGHTS

CopyrightsCopyrights

• Definition: Copyright protects original works of authorship from being reproduced

• Applies to a wide variety of works, including literary, musical, dramatic, graphic, sculptural and architectural works, motion pictures, and sound recordings

• Not just critically acclaimed works

• Extends to advertising brochures, computer programs, and databases

What is Protected What is Protected By a Copyright?By a Copyright?

Literary works

Computer software

Pantomimes andchoreographic works

Musical compositions

Dramatic works

Pictorial, graphic, andsculptural works

Does not extend to ideas, procedures, processes, systems, concepts or mere slogans, titles or blank forms

CopyrightCopyrightProtectionProtection

• How copyrights arise:– Copyright protection exists from the moment a

work is created– No registration is required (but helps enforce)

• Copyrights last for a long time– Author’s life plus 70 years– In the case of works created by employees for

their employers, the shorter of 95 years from publication or 120 years from creation

Enhancing Enhancing Copyright Copyright ProtectionProtection

• The following steps can be taken, however, to enhance copyright protection

• Copyright protection can be enhanced by attaching the copyright notice, or “copyright bug” to something

• Registering the work with the U.S. Copyright Office– Statutory damages– Attorney’s fees– Cheap and easy

PATENTS – Evaluate and file early to protect

TRADE SECRETS – Identify and create good facts

TRADEMARKS – Use and register

COPYRIGHTS – Register

wborchers@jw.comwborchers@jw.com 210.978.7700210.978.7700

Jackson Walker L.L.P.www.jw.com

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