I am frequently asked to provide guidance on intellectual property license agreements, and thought a short guide would be helpful to readers. If you compare intellectual property (IP) rights to a bundle of sticks, the licensee would be required to obtain a couple sticks out of that bundle to continue her project. A license is granted when one obtains a subset of the full ownership rights of intellectual property.
What can the licensor and licensee expect to see in a license agreement? These agreements vary greatly, depending on the unique circumstances of each deal, including the type of IP being licensed, the licensee’s intended use of the IP, and the size of the contracting parties. Here’s a list of some of the clauses that are common to intellectual property licenses:
Definition of the intellectual property being licensed. This can sometimes be heavily negotiated because this defines exactly what the licensee can sell by using the licensed IP.
Scope of the license. Licenses can vary greatly. Sometimes there are geographic limitations to where a licensee can exploit her license, sometimes there are temporal limitations. Channels of trade may also be restricted—for instance, a license to use some software license may be limited to software sold in retail stores, or internet stores. The licensee may also be limited in how she can use her license. Licensors may also wish to set minimum or maximum price levels a licensee can sell a product at. There are other elements that can limit the scope of use; these negotiations can become quite complex.
Royalty terms. For obvious reasons, these are some of the most heavily-negotiated terms in a license agreement. Royalties can be paid in a variety of ways—in a lump sum, or on a regular, ongoing basis. The calculation of royalties may be done using a variety of methods, including looking at net sales resulting from the license, or profits resulting from the license. The payment method, term, and regularity will need to be agreed upon by both parties.
Audits. With any calculation of royalties based on a licensee’s sales or performance, the licensor will want to conduct regular audits of the licensee’s activities. Parties will need to decide when these will take place, by whom, and who will bear the costs of such audits.
Enforcement. Parties will also need to determine whose duty it is to enforce the intellectual property associated with the license. There are several ways of organizing this duty, and the stakes can be high for all parties involved.
Modifications to Intellectual Property. Will the licensee be able to modify or improve the intellectual property in any way? Who will own the rights to such modifications?
This list represents a sample of the many considerations that may arise in a licensing transaction. If you have any further questions about licensing agreements, then please contact Veronique Kherian at vkherian@higagipsonllp.com. You can also reach Ms. Kherian by telephone at (415) 692-6520.
Showing posts with label intellectual property. Show all posts
Showing posts with label intellectual property. Show all posts
Thursday, April 26, 2012
Tuesday, January 17, 2012
The Medical Field's Copyright Clash
Lately, the medical community has been buzzing about copyright law’s intrusion into the field. It is rare to see the merging of these two fields, but disputes have been mounting over the use of a diagnostic tool used to test mental ability (often to screen for dementia) - the Mini-Mental State Evaluation (MMSE).
The MMSE has been in existence since 1975, and, until about 2000, was freely available for use. The MMSE became a standard diagnostic tool for doctors and medical schools; it was freely referenced in manuals and textbooks. The test measures cognitive ability based on certain categories: orientation to time, orientation to place, registration, attention and calculation, recall, language, repetition, and complex commands. The original authors of the test maintained their copyright rights from 1975 until 2000, when they transferred their rights to MiniMental. In turn, MiniMental granted Psychological Assessment Resources (PAR) an exclusive license to publish the test. The transfer of copyright explains the dramatic shift from a dearth of copyright enforcement from 1975 to 2000 to aggressive enforcement from 2000 forward. The test started disappearing from textbooks, and users of the test were required to have a license from PAR.
The most recent dispute involves the Sweet 16 test, a 16-question test also used to gauge cognitive ability. In response to the tighter policing of the MMSE test, Dr. Tamara Fong, a Harvard University researcher, developed the Sweet 16 test in 2010. The Sweet 16 test, used to test Cognitive ability, like the MMSE test, was sometimes preferred by doctors because it was shorter to administer and did not require pen and paper. The Sweet 16 test was freely available on the Internet until recently, when PAR demanded the test be taken down. Although Dr. Fong independently created the test, several elements are apparently substantially similar to the MMSE, enough for PAR to make a copyright infringement threat.
The uproar over the enforcement of copyright rights for these two tests raises many questions, legal and ethical. Should a test that has been freely distributed for nearly 30 years and that has been a staple of the medical field suddenly be unavailable except to those willing to pay a licensing fee? Should public interest dictate that the test be transferred to the public domain, particularly because it has been so prevalent for decades? Is it consistent with public policy for the law to continue to protect the holders of these property rights? What kind of test for cognitive ability can doctors, schools, and textbooks safely use without fear of infringing on PAR’s copyright rights?
It is perfectly legitimate to wonder how a medical test could be copyrighted in the first place. Copyright law dictates that one cannot copy an idea, but an expression of an idea fixed in a tangible form is protectable. The MMSE tests skills such as language, calculation, and orientation to time. The testing of these themes constitutes an idea, but the specific questions posed to establish, for instance, language skills, might be eligible for copyright protection under certain circumstances. There are several ways to test language skills, so protecting one question wouldn’t necessarily prevent someone from testing language in a different way. However, how many ways are there to test orientation to time? One could ask the day of the week, the current month, the year, but not very much else. In a case like this, one could argue that because there are a limited number of ways to test time orientation, that question should not be eligible for copyright protection. Just as many written forms (that ask your name, address, contact information, educational background, etc.) are ineligible for copyright protection, shouldn’t several basic orientation questions be ineligible for copyright protection? Many in the medical field think so.
What are the public policy concerns? The MMSE is a work that has been freely available for nearly 30 years. The MMSE is heavily ingrained in the medical profession, and it has helped in the proper treatment of countless patients. Can such a work really be snatched out of the medical profession’s hands after such a long time? Copyright law was designed to balance the rights of the author to profit from his/her work against the rights of the public to benefit from the work. There are set durations established for copyright law, but a court, should it come across this situation, will weigh these two sets of rights and the circumstances. Many feel the test should pass to the public domain because of its longtime presence in the field. PAR will certainly disagree. Here at Higa & Gipson, LLP this is just one of the trends in intellectual property law that we follow to provide exceptional representation in this dynamic field of law.
If you have any questions about copyright protection, then please contact Ronnie Gipson at Gipson@higagipsonllp.com, or Veronique Kherian at vkherian@higagipsonllp.com. We can be reached by telephone at (415) 692-6520.
The MMSE has been in existence since 1975, and, until about 2000, was freely available for use. The MMSE became a standard diagnostic tool for doctors and medical schools; it was freely referenced in manuals and textbooks. The test measures cognitive ability based on certain categories: orientation to time, orientation to place, registration, attention and calculation, recall, language, repetition, and complex commands. The original authors of the test maintained their copyright rights from 1975 until 2000, when they transferred their rights to MiniMental. In turn, MiniMental granted Psychological Assessment Resources (PAR) an exclusive license to publish the test. The transfer of copyright explains the dramatic shift from a dearth of copyright enforcement from 1975 to 2000 to aggressive enforcement from 2000 forward. The test started disappearing from textbooks, and users of the test were required to have a license from PAR.
The most recent dispute involves the Sweet 16 test, a 16-question test also used to gauge cognitive ability. In response to the tighter policing of the MMSE test, Dr. Tamara Fong, a Harvard University researcher, developed the Sweet 16 test in 2010. The Sweet 16 test, used to test Cognitive ability, like the MMSE test, was sometimes preferred by doctors because it was shorter to administer and did not require pen and paper. The Sweet 16 test was freely available on the Internet until recently, when PAR demanded the test be taken down. Although Dr. Fong independently created the test, several elements are apparently substantially similar to the MMSE, enough for PAR to make a copyright infringement threat.
The uproar over the enforcement of copyright rights for these two tests raises many questions, legal and ethical. Should a test that has been freely distributed for nearly 30 years and that has been a staple of the medical field suddenly be unavailable except to those willing to pay a licensing fee? Should public interest dictate that the test be transferred to the public domain, particularly because it has been so prevalent for decades? Is it consistent with public policy for the law to continue to protect the holders of these property rights? What kind of test for cognitive ability can doctors, schools, and textbooks safely use without fear of infringing on PAR’s copyright rights?
It is perfectly legitimate to wonder how a medical test could be copyrighted in the first place. Copyright law dictates that one cannot copy an idea, but an expression of an idea fixed in a tangible form is protectable. The MMSE tests skills such as language, calculation, and orientation to time. The testing of these themes constitutes an idea, but the specific questions posed to establish, for instance, language skills, might be eligible for copyright protection under certain circumstances. There are several ways to test language skills, so protecting one question wouldn’t necessarily prevent someone from testing language in a different way. However, how many ways are there to test orientation to time? One could ask the day of the week, the current month, the year, but not very much else. In a case like this, one could argue that because there are a limited number of ways to test time orientation, that question should not be eligible for copyright protection. Just as many written forms (that ask your name, address, contact information, educational background, etc.) are ineligible for copyright protection, shouldn’t several basic orientation questions be ineligible for copyright protection? Many in the medical field think so.
What are the public policy concerns? The MMSE is a work that has been freely available for nearly 30 years. The MMSE is heavily ingrained in the medical profession, and it has helped in the proper treatment of countless patients. Can such a work really be snatched out of the medical profession’s hands after such a long time? Copyright law was designed to balance the rights of the author to profit from his/her work against the rights of the public to benefit from the work. There are set durations established for copyright law, but a court, should it come across this situation, will weigh these two sets of rights and the circumstances. Many feel the test should pass to the public domain because of its longtime presence in the field. PAR will certainly disagree. Here at Higa & Gipson, LLP this is just one of the trends in intellectual property law that we follow to provide exceptional representation in this dynamic field of law.
If you have any questions about copyright protection, then please contact Ronnie Gipson at Gipson@higagipsonllp.com, or Veronique Kherian at vkherian@higagipsonllp.com. We can be reached by telephone at (415) 692-6520.
Wednesday, November 9, 2011
Geography & Trademark Law
Some trademark owners who wish to use geographical terms in their marks may meet some registration hurdles, as well as resistance from other trademark holders with the same idea. Using geographical terms is tightly regulated by the U.S. Patent & Trademark Office, and can only be done in certain circumstances.
You are most likely to be able to use a geographical term in a trademark if it is considered a geographical indicator. This term is used to designate products that have special characteristics due to the place they are from. Fine food enthusiasts refer to these location-specific characteristics as terroir. Producers of such products as Champagne from the Champagne region of France, oranges from Florida, apples from Washington state, and blue cheese from Roquefort, France, want you to believe that their products are special because of the special conditions where they are produced. Despite whether or not you believe this to be true, there does exist protection for these geographical indicators. France’s AOC (Appellation d’Origine Contrôlée) system is one of the most familiar. Producers in geographical areas who wish to obtain AOC-eligible products must meet rigorous production standards. The French model has led to the creation of similar systems in other countries such as Spain (Demonación de Origen), the United States (American Viticultural Areas), and, on a broader scale, Protected Geographical Status in the European Union.
In the United States, Geographical Indicators receive the same amount of protection as trademarks, and are administrated by the U.S. Patent & Trademark Office.
If you are a business owner and you want to use a geographical term such as your city, or even an exotic place you’ve never been to, then be cautious. The U.S. Patent & Trademark Office will refuse a trademark application it finds is geographically descriptive or geographically misdescriptive. Geographically descriptive marks, which merely state the origin of a product without alluding to any link between the quality of the product and the place, are refused to allow other parties to use the same geographical location in their marks. Geographically misdescriptive marks indicate a location other than the origin of the goods. The U.S. Patent & Trademark finds these types of marks could confuse consumers into believing the goods do come from the stated location.
You are most likely to be able to use a geographical term in a trademark if it is considered a geographical indicator. This term is used to designate products that have special characteristics due to the place they are from. Fine food enthusiasts refer to these location-specific characteristics as terroir. Producers of such products as Champagne from the Champagne region of France, oranges from Florida, apples from Washington state, and blue cheese from Roquefort, France, want you to believe that their products are special because of the special conditions where they are produced. Despite whether or not you believe this to be true, there does exist protection for these geographical indicators. France’s AOC (Appellation d’Origine Contrôlée) system is one of the most familiar. Producers in geographical areas who wish to obtain AOC-eligible products must meet rigorous production standards. The French model has led to the creation of similar systems in other countries such as Spain (Demonación de Origen), the United States (American Viticultural Areas), and, on a broader scale, Protected Geographical Status in the European Union.
In the United States, Geographical Indicators receive the same amount of protection as trademarks, and are administrated by the U.S. Patent & Trademark Office.
If you are a business owner and you want to use a geographical term such as your city, or even an exotic place you’ve never been to, then be cautious. The U.S. Patent & Trademark Office will refuse a trademark application it finds is geographically descriptive or geographically misdescriptive. Geographically descriptive marks, which merely state the origin of a product without alluding to any link between the quality of the product and the place, are refused to allow other parties to use the same geographical location in their marks. Geographically misdescriptive marks indicate a location other than the origin of the goods. The U.S. Patent & Trademark finds these types of marks could confuse consumers into believing the goods do come from the stated location.
If you have a question related to trademark applications with or without geographic names, then please contact Special Counsel, Veronique Kherian at vkherian@higagipsonllp.com or at (415) 692-6520 Ext. 109.
Tuesday, November 1, 2011
Search Engine Optimization Can Cause Trademark Infringement
Scrutinize Search Engine Optimization Submissions to Avoid Trademark Infringement
A trademark is a word, name, symbol, or device that a business uses to identify its goods or services and to distinguish those goods or services from those offered by others. Accordingly, the owner of a trademark has the exclusive right to use that mark in interstate commerce. Infringement occurs when a party uses a mark identical to or confusingly similar to a trademark owned by another party. The penalties for trademark infringement are not dependent on the intent of the infringer; trademark infringement is categorized as strict liability. In the United States, trademark infringement is pursued under the Lanham Act. Accordingly, a party found liable for trademark infringement may be subject to the following:
• trademark owner’s lost profits;
• costs of court action;
• trademark owner’s attorney’s fees;
• statutory penalties of three times (3X) actual damages; and/or
• infringer’s goods subject to injunction.
Note that Federal law protections apply regardless of whether the owner of the mark registered the mark with the US Patent & Trademark Office.
Armed with this knowledge, most present day business owners refrain from creating marks that are identical to a competitor’s mark or one that is confusingly similar to a competitor’s mark. A problem arises; however, when an examination of a company’s website reveals that the website uses metatags containing trademarks of competitors. Back in 1999, the Ninth Circuit Court of Appeals held that using a competitor’s mark in your company’s metatags may lead to initial interest confusion, which in turn can amount to trademark infringement.
What are metatags? If a consumer searching for a good or service does not know the company’s domain name, then the consumer will use a search engine such as Yahoo® or Internet Explorer® by typing in keywords to look for the target company’s website. When keywords are entered, the search engine processes those words through a self-created index of websites to generate a list of websites relating to the entered keywords. Each search engine uses its own algorithm to arrange indexed materials in sequence, so the list of websites that any particular set of keywords will bring up differs depending on the search engine used. Search engines look for keywords in domain names, actual text on the web page, and in metatags. Metatags are HTML code intended to describe the contents of the web site. Description metatags describe the web site. Keyword metatags contain keywords relating to the contents of the web site.
With this basic understanding of Internet search engines, there exists the possibility for a company to commit trademark infringement in its efforts to drive consumer traffic to its site. With the growth of the Internet, there is an accompanying growth in the number of firms offering Search Engine Optimization services where a company will revamp a company’s website by expanding the keywords used as metatags to boost the company to the top of the search engine’s list when a search is conducted by a consumer. For example, suppose that a company creates a website to market and sell a new soft drink. The website itself and the text on the web pages that make up the website make no reference to its competitors’ mark or products. However, the SEO firm hired by the company to market the new soft drink set up an entire page of metatags designed to hoist the company’s website to the top of searches for soft drinks. On this hypothetical metatags description page, the following terms appear: Pepsi, Coca-Cola, Gatorade, Lipton, and Starbucks among a host of other descriptive terms. The SEO firm inadvertently exposed the soft drink company to at least 4 separate trademark infringement claims. Why? Taking a moment to consider the circumstances reveals the error.
The soft drink company’s competitors have spent a lot of time and money building their respective brands. Yet, by listing the competitors’ trademarks in its metatags, the new soft drink company effectively usurps its competitors’ trademarks as descriptors for its new product. The result will be that a consumer searching for Coca-Cola would be directed to the new soft drink company’s website instead as a result of the search. The new soft drink company is using the fruits of another competitor’s labor and brand building to capture market share. In essence, this redirection of a consumer by using another’s mark amounts to initial interest confusion which could rise to the level of trademark infringement in the wrong circumstances.
The prudent course of action is to closely scrutinize the keywords and descriptors being used to describe your company’s goods or services when the website is initially set up or when a SEO firm is hired to boost traffic to your company’s website. In a trademark infringement action, the owner of the website would be the primary infringer and would be liable for any resulting damages. It is important to note that liability may or may not run to the SEO firm depending on the contractual terms between the parties. In any event, the new soft drink company would be clearly identified as the infringer.
If your company is creating a website or hiring a SEO firm to overhaul your company’s website, then be aware that the use of competitors’ marks in the metatags exposes your company to liability for a trademark infringement claim. The best practice is to eliminate any keywords as metatags that could create initial interest confusion between your products or services and a competitor’s goods or services. For more information on this topic, then contact either Ronnie Gipson at (415) 692-6523, email at gipson@higagipsonllp.com; or Veronique Kherian at (415) 692-6520, email at vkherian@higagipsonllp.com.
A trademark is a word, name, symbol, or device that a business uses to identify its goods or services and to distinguish those goods or services from those offered by others. Accordingly, the owner of a trademark has the exclusive right to use that mark in interstate commerce. Infringement occurs when a party uses a mark identical to or confusingly similar to a trademark owned by another party. The penalties for trademark infringement are not dependent on the intent of the infringer; trademark infringement is categorized as strict liability. In the United States, trademark infringement is pursued under the Lanham Act. Accordingly, a party found liable for trademark infringement may be subject to the following:
• trademark owner’s lost profits;
• costs of court action;
• trademark owner’s attorney’s fees;
• statutory penalties of three times (3X) actual damages; and/or
• infringer’s goods subject to injunction.
Note that Federal law protections apply regardless of whether the owner of the mark registered the mark with the US Patent & Trademark Office.
Armed with this knowledge, most present day business owners refrain from creating marks that are identical to a competitor’s mark or one that is confusingly similar to a competitor’s mark. A problem arises; however, when an examination of a company’s website reveals that the website uses metatags containing trademarks of competitors. Back in 1999, the Ninth Circuit Court of Appeals held that using a competitor’s mark in your company’s metatags may lead to initial interest confusion, which in turn can amount to trademark infringement.
What are metatags? If a consumer searching for a good or service does not know the company’s domain name, then the consumer will use a search engine such as Yahoo® or Internet Explorer® by typing in keywords to look for the target company’s website. When keywords are entered, the search engine processes those words through a self-created index of websites to generate a list of websites relating to the entered keywords. Each search engine uses its own algorithm to arrange indexed materials in sequence, so the list of websites that any particular set of keywords will bring up differs depending on the search engine used. Search engines look for keywords in domain names, actual text on the web page, and in metatags. Metatags are HTML code intended to describe the contents of the web site. Description metatags describe the web site. Keyword metatags contain keywords relating to the contents of the web site.
With this basic understanding of Internet search engines, there exists the possibility for a company to commit trademark infringement in its efforts to drive consumer traffic to its site. With the growth of the Internet, there is an accompanying growth in the number of firms offering Search Engine Optimization services where a company will revamp a company’s website by expanding the keywords used as metatags to boost the company to the top of the search engine’s list when a search is conducted by a consumer. For example, suppose that a company creates a website to market and sell a new soft drink. The website itself and the text on the web pages that make up the website make no reference to its competitors’ mark or products. However, the SEO firm hired by the company to market the new soft drink set up an entire page of metatags designed to hoist the company’s website to the top of searches for soft drinks. On this hypothetical metatags description page, the following terms appear: Pepsi, Coca-Cola, Gatorade, Lipton, and Starbucks among a host of other descriptive terms. The SEO firm inadvertently exposed the soft drink company to at least 4 separate trademark infringement claims. Why? Taking a moment to consider the circumstances reveals the error.
The soft drink company’s competitors have spent a lot of time and money building their respective brands. Yet, by listing the competitors’ trademarks in its metatags, the new soft drink company effectively usurps its competitors’ trademarks as descriptors for its new product. The result will be that a consumer searching for Coca-Cola would be directed to the new soft drink company’s website instead as a result of the search. The new soft drink company is using the fruits of another competitor’s labor and brand building to capture market share. In essence, this redirection of a consumer by using another’s mark amounts to initial interest confusion which could rise to the level of trademark infringement in the wrong circumstances.
The prudent course of action is to closely scrutinize the keywords and descriptors being used to describe your company’s goods or services when the website is initially set up or when a SEO firm is hired to boost traffic to your company’s website. In a trademark infringement action, the owner of the website would be the primary infringer and would be liable for any resulting damages. It is important to note that liability may or may not run to the SEO firm depending on the contractual terms between the parties. In any event, the new soft drink company would be clearly identified as the infringer.
If your company is creating a website or hiring a SEO firm to overhaul your company’s website, then be aware that the use of competitors’ marks in the metatags exposes your company to liability for a trademark infringement claim. The best practice is to eliminate any keywords as metatags that could create initial interest confusion between your products or services and a competitor’s goods or services. For more information on this topic, then contact either Ronnie Gipson at (415) 692-6523, email at gipson@higagipsonllp.com; or Veronique Kherian at (415) 692-6520, email at vkherian@higagipsonllp.com.
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