February 2010

Understanding Patent Law

Patent protection is provided by federal law through the United States Patent and Trademark Office (USPTO) and gives a patent owner the right to exclude others from making, using, selling, distributing or importing the subject of the patent for a certain period of time. Only certain things may be patented, and there are several requirements that an invention or other subject of a patent application must meet in order to be eligible to receive patent protection. One of the most basic requirements is novelty, or newness. The purpose of the novelty requirement is to prevent the patenting of inventions that have become widely known and used, which are said to have entered the public domain, and to carry out the general principle that the first person to create an invention is entitled to patent it.

Definition of Novelty

In order to be novel, an invention cannot have been previously patented, described in a printed publication or used or known by others prior to its invention by the patent applicant. To be known by others, a patent must have been fully disclosed and the disclosure must be accessible to the public in the United States. Only minimal use of an invention by others is necessary to disqualify patent eligibility as long as the use is accessible to the public, which is the case if no steps were taken to conceal the use. Experimental use by the inventor to test the invention is not a use that will disqualify patent eligibility. Printed publication of a description constitutes accessible disclosure of the invention as long as the publication is distributed or is filed in such a way that a member of the public could find it by exercising reasonable diligence. Patents are usually published, which also constitutes printed publication that will negate patent eligibility. If a patent is not published, the relevant inquiry is whether the exact thing to be patented was previously patented and not merely described in an application that ultimately protected some other invention.

Additional provisions of patent law prevent an inventor from obtaining a patent if another inventor had taken steps to patent the invention that resulted in the public disclosure of the invention and if another person invented the item before the patent applicant and did not abandon, suppress, or conceal the invention before the patent applicant invented the item. These provisions protect the rights of an earlier inventor against a later inventor.

In order to determine whether an invention to be patented meets the novelty requirement, the U.S. Patent and Trademark Office will search through existing patents and other literature in the field in which the invention is classified to see if the invention has been patented or described in a way that discloses it to the public. The body of information that will reveal whether an invention to be patented meets the novelty requirement is referred to as the “prior art.” If the prior art indicates that the invention to be patented has already been patented or described in a publication or in another manner, the item for which a patent is sought is said to have been “anticipated,” and the item will not be eligible for a patent. Inventors may conduct searches prior to applying for a patent to avoid the unnecessary expense of time and money in applying for a patent that will most likely be revealed to have been anticipated by the prior art.

Maintaining the term of a Patent

Utility patents apply to inventions and processes and are distinguished from design and plant patents. Under current patent law, the term of a new utility patent is 20 years, during which the patent holder has the right to exclude others from using, making, selling or distributing the invention or process. However, for utility patents based on applications filed on or after December 12, 1980, the 20-year patent term is subject to the payment of maintenance fees.

Patent maintenance fees must be paid 3 and one-half years, 7 and one-half years, and 11 and one-half years from the date the patent is granted. A fee schedule is maintained in the Code of Federal Regulations, and the fee amounts vary depending on whether or not the patent holder is a small entity, which the United States Patent and Trademark Office (USPTO) defines as an independent inventor, a small business concern, or a nonprofit organization. If they are paid within the six-month period preceding the due dates, the maintenance fees may be paid without surcharge. If the maintenance fees are not paid, the patent will expire. However, there is an additional six-month grace period after the due date within which the maintenance fees may be paid, along with a surcharge, in order to keep the patent in force. The USPTO does not remind patent holders when maintenance fees are due; however, if maintenance fees are not paid on time, the USPTO will attempt to remind a patent holder that maintenance fees may still be paid during the grace period along with a surcharge.

If the maintenance fees are not paid by the end of the grace period, the USPTO allows a patent holder to petition the USPTO for the application of an unintentionally or unavoidably delayed payment and for reinstatement of an expired patent. However, during the time from the expiration and reinstatement of the patent, another person or business may establish rights to use, sell, import or distribute the patented invention or process. Depending on the circumstances, a court may allow such use of the patented invention or process to continue even after the patent is reinstated in order to protect the investment of the person or business, which had a right to presume that the patent had been abandoned when it was allowed to expire.

Fair Use under Trademark Law

A party is entitled to use a trademark in such as way as to describe the qualities that a mark represents as long as the manner of use of the mark is not as a trademark but only used in a descriptive sense. Fair use of a trademark occurs when a defendant uses a descriptive trademark of another party to describe the defendant’s own product. This is the fair use defense set forth in the Lanham Act that provides the use of the name, term, or device charged to be an infringement is a use, otherwise than as a mark…of a term or device which is descriptive of and used fairly and in good faith only to describe the goods or services of such party, or their geographic origin.

While a trademark will protect a word which is used by a manufacturer or merchant to identify goods and distinguish them from others, trademark law will not prevent the use of such a word in good faith where the primary purpose is to describe a product or service, not to infringe the trademark resembled by it. The statutory fair use defense provided in the Lanham Act prevents a trademark owner from monopolizing or appropriating a descriptive word or phrase. It allows non-owners of the trademark to accurately describe their goods. Therefore, the defense is only available when the mark at issue is descriptive, and then only where the descriptive term is used descriptively.

Judge-Made Categories of Fair Use

Although, the Lanham Act contains the statutory fair use provision mentioned above, there are three additional judge-made categories where use of the trademark of another may be considered non-infringing. They are (1) nominative fair use, (2) comparative advertising as fair use, and (3) parody as fair use.

Nominative fair use involves the descriptive use of another’s mark to describe or identify the plaintiff’s goods or services, not the defendant’s. Comparative advertising involves a situation where the trademark of a competitor is used to refer to the competitor’s goods. Parody is a humorous form of social commentary and literary criticism.

Factors Considered in Determining Fair Use

Several different factors are considered by courts to determine whether a particular use is an infringing use or a fair use. Those factors are as follows:

  • the manner in which the word or mark is being used by the defendant is considered;
  • whether the defendant is using the word or mark in good faith is considered; and
  • whether the use of the word or mark is likely to confuse consumers is also considered.

The author’s use of the mark must accurately describe the trademark owner’s product or service, the author must use the mark in a non-trademark manner and not as a source identifier of the author’s work, and the author’s use must be in good faith in order for the fair use defense to be successful.

Trademarking Internet Domain Names

Copyright law does not protect domain names, but Trademark law may. Generally, the United States Patent and Trademark Office (USPTO) has tried to apply traditional trademark law to the examination of domain name service mark applications. A domain name qualifies as a mark when it is used in connection with the sale or advertising of goods or services. This includes all sites conducting e-commerce and also sites that provide Web-related services. Unlike a trademark, which is restricted by country and class of goods, domain names can be global and not limited by goods or service.

Internet Corporation for Assigned Names and Numbers

The Internet Corporation for Assigned Names and Numbers (ICANN), a nonprofit organization that has assumed the responsibility for domain name system management, administers the assignation of domain names through accredited registers.

Domain Name Disputes

Prior to November 1999, domain name disputes in the United States were decided by courts under the following three primary theories of trademark law:

  • traditional trademark infringement, which requires that the allegedly infringing use cause a likelihood of consumer confusion;
  • the assertion that a domain name “dilutes” the value of a trademark; or
  • unfair competition claims asserted in cases in which the trademark was not federally registered.

In November 1999, Congress added a new cause of action to the Lanham Act with the Anti-cybersquatting Consumer Protection Act, which was expressly designed to prevent cybersquatting.

Choosing a Domain Name

One is at risk of losing a chosen domain name if the owner of an existing trademark convinces a judge or arbitrator that the use of the domain name makes it likely that customers would be confused as to the source or quality of the products. To be protected, a trademark must be distinctive. If the trademark owner has been able to register a name with the USPTO, it is probably distinctive.

Generic Terms are not Trademarks

Many domain names are potentially powerful domain names but they are generic because they describe whole categories of products or services. Generic terms can never be trademarks.

Use of Domain Names to Support Service Mark Registration

Domain names are used like telephone numbers and addresses. They often provide information as to how to contact the entity rather than functioning as identifiers of a service. Specimens of this type will be refused in the USPTO because they do not show service mark use of the matter presented for registration. The more distinctive the presentation of the domain name, the more it will be perceived by the USPTO as functioning as a service mark and not just as contact information for a particular entity. The domain name must be used as a source identifier and not just as an entity locator.

Some uses that may qualify as good service mark use of domain names include hard copy advertisements for a Web site in which the significant portion of the domain name has been highlighted or set off in some other way. A domain name used as a banner headline on the Web site itself would probably be seen as functioning as a service mark.

Contact one of our if you would like to trademark your domain name.

Protecting Trade Secrets

The Economic Espionage Act of 1996 (EEA) provided a broader definition of what constitutes a “trade secret” and what constitutes trade secret theft, effectively replacing the 1948 Trade Secrets Act, which was limited to prosecution of federal employees. The EEA also was passed so as to serve as a universal trade secret theft act, overriding various trade secret acts instituted by individual states.

Business Practices Protected as Trade Secrets

Not all business practices are regarded and protected as “trade secrets.” To qualify, the owner of the trade secret must have “taken reasonable measures to keep the information secret” and the information must “derive economic value from not being known to or ascertainable by the public.” The EEA does not apply to trade secrets discovered by “parallel development or reverse engineering.” Skills and knowledge that an individual acquires through lawful means while working are also not subject to persecution under the EEA.

Theft of a Trade Secret

Both the party who acquires the information and anyone who receives it are punishable under the EEA. For an individual to be considered a thief of a trade secret, the individual must have taken, transmitted, or recorded in some form an article regarded to be a trade secret through deception or without authorization. If another individual or group of individuals then “receives, buys or possesses” the information, knowing it was obtained through deceitful means, that individual or group of individuals is punishable under the EEA. Also punishable are those individuals who, by breaking the EEA, are knowingly benefiting a foreign government or agent from a foreign country.

Contact one of our attorneys if you have concerns about the theft of a trade secret.