Patents and Trademarks
Chapter 8
Patents and Trademarks
Public relations and advertising professionals routinely encounter copyright issues. But in many organizations, patents (which relate to inventions) and trademarks (which identify goods) can play an important day-to-day role as well. That’s why an understanding of these types of intellectual property is essential.
As with copyrights (discussed in Chapter 7), the constitutional origins of patents can be traced to Article I, Section 8, of the U.S. Constitution, which gives Congress the authority “[t]o promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”1 Whereas copyright law provides a limited monopoly—and therefore, an economic incentive—to those who produce original works of authorship, patent law provides a similar monopoly that allows inventors to profit from their innovations. Because of their clear origin in Article I, Section 8, patents and copyrights are regulated almost exclusively by federal statutes.
In contrast, trademarks involve both state and federal statutes, as well as common law. Federal trademark law arises out of the Constitution’s “commerce” and “supremacy” clauses. The commerce clause, also in Article I, Section 8 of the U.S. Constitution, provides that Congress shall have the power “[t]o regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes. …”2 This authority for Congress to regulate interstate (“among the several States”) commerce has been interpreted broadly; one offshoot is federal trademark law, codified primarily in Title 15 of the United States Code (known as the “Lanham Act” or the “Trademark Act of 1946”).3
The supremacy clause, in Article VI of the U.S. Constitution, gives federal law the right of preemption over state law. It provides, in part:
This Constitution, and the Laws of the United States which shall be made in Pursuance thereof and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the Contrary not withstanding.”4
As a result, trademarks may be registered and have protection under either state or federal statutes, the latter occurring if the mark is used in interstate commerce. State trademark laws, however, are not permitted to conflict with federal law.
Patents
The U.S. Patent and Trademark Office (USPTO), which, as the name indicates, handles both patents and trademarks, is an agency in the Department of Commerce headed by the commissioner of patents and trademarks, an assistant secretary of commerce. Patents, trademarks and copyright are all forms of exclusive (i.e., monopolistic) control that owners, who can be individuals or companies, can exercise to ensure that others generally cannot market, use or sell the work, invention or mark without the owner’s consent.
There are three basic types of patents: utility, plant and design. Patents on mechanical devices, electrical and electronic circuits, chemicals and similar items are known as utility patents.5 Plant patents apply to the invention or asexual reproduction of a distinct new variety of a natural plant6 and design patents are issued for new, original and ornamental designs.7 In 1994, the U.S. Court of Appeals for the Federal Circuit, which hears all appeals from all decisions in patent infringement suits,8 ruled that computer software could be patented, although mathematical formulas and algorithms cannot be. In In re Alappat, the court reasoned that software “creates a new machine, because a general purpose computer in effect becomes a special purpose computer once it is programmed.”9
Creation and Duration
Under the current law, patents generally are protected for a 20-year term, measured strictly from the filing date. In some cases, the 20-year period can be extended for a maximum of five years when marketing time was lost because of regulatory delay.10 The 20-year period was chosen because it has been the standard of the rest of the industrialized world for some time. The law also creates a means by which a provisional application can be filed while the inventor prepares the regular application, which must be filed within one year.
Securing a patent is typically only the first step in the process. Before the invention can be marketed, approval from other federal and state agencies may be needed. For example, a new food or drug product would probably require a green light from the U.S. Food and Drug Administration. Protecting a name under which the invention is to be sold would require compliance with provisions of trademark laws, and probably trademark registration at some point. Unlike trademark and copyright laws, patent law is incredibly complex and the process of obtaining a patent is expensive, time-consuming and complicated. Attorneys who handle patent applications must be specially admitted to the Patent Bar. The filing fee for registering a patent is $330–$850 (if the company has at least 500 employees), and the costs of a search, which may be necessary to establish the novelty of the invention, can add up to thousands of dollars more.
An inventor also may file a provisional patent application, under which the patent is protected from infringement for one year without having to demonstrate that the invention has already been built and used (a requirement for protection under traditional patent law). During the one-year interim, the inventor is given the opportunity to market the invention without fear of it being stolen.
Patent Infringement
Because the stakes can be quite high, patent holders for popular inventions rigorously defend their rights even against small-time entrepreneurs and companies. Infringement of a patent can result in extensive damages, as illustrated in the infringement suit filed by Polaroid against Eastman Kodak over instant photography.11 When the dust settled in 1986, Eastman Kodak was ordered to pay Polaroid more than $1 billion in damages and was prohibited from further sales of instant photo cameras, film and related products. The suit was based on patents granted to Polaroid in the 1970s.
Patents are generally granted on a first-come, first-served basis, and the race to the finish line can be intense when competitors battle. When two or more claimants apply separately for a patent on essentially similar inventions, the USPTO will hold an interference proceeding, complete with motions and testimony, to ascertain the rightful inventor.
Trademarks
Under the Lanham Act, a trademark is defined as “… any word, name, symbol, or device, or any combination thereof adopted and used by a manufacturer or merchant to identify his or her goods or services.”12 Thus, a trademark can be a name, slogan, design or distinct sound so long as it identifies and distinguishes the trademarked goods or services from those of others. The key characteristics are identification and distinction. Classic examples are the Nike Corporation’s use of the name Nike, the “swoosh” symbol that appears on Nike products and the slogan “Just do it.”
Colors were recognized as potential trademarks in the 1995 Supreme Court decision Qualitex Company v. Jacobson Products, Inc.13 A unanimous Court held that the Lanham Trademark Act of 1946 allows trademark registration of a color. The opinion, written by Justice Breyer, said that the special shade of green-gold used to identify dry cleaning press pads made by Qualitex had acquired the requisite “secondary meaning” under the Lanham Act. A color acquires secondary meaning when consumers strongly associate it with a particular product. Jacobson Products, a competitor to Qualitex, had challenged the trademark registration, unsuccessfully arguing that such registration would create uncertainty about what shades of color a competitor could use and that it was unworkable because of the limited supply of colors. Sounds, such as the roar of the MGM lion, have enjoyed trademark protection for some time, although registration for sounds is harder to come by. As with colors, sounds can attain trademark status only if they have acquired secondary meaning. In 1978, the Trademark Trial and Appeal Board recognized the combination of the musical notes “G, E, and C” used by the National Broadcasting Company as a valid trademark.14 Harley-Davidson, Inc., which already owns the rights to the word hog for motorcycles, applied for a trademark on its engine sound in 1994, but several competitors, including Suzuki, Honda and Kawasaki, opposed the registration. After six years of litigation, and with no apparent end in sight, Harley-Davidson abandoned its sound trademark application in 2000.
Service Marks
Service marks are essentially the same as trademarks, except that they identify the source of services rather than goods. Bank of America, for example, the name for the institution that provides banking and financial services, is a service mark, as is the red and blue stylized mark that appears on the company’s checks, ATMs and brick-and-mortar banking centers. Other famous service marks include Hertz, Avis, Home Box Office, The Movie Channel, Citicorp and True Value. The distinction between trademarks and service marks is semantic; the law operates identically for both. To avoid repetition, the term trademark is used hereinafter to refer to both trademarks and service marks.
Purpose
Trademarks are extremely important in advertising and public relations. Through the effective marketing and communication of its trademark, an owner can build invaluable market goodwill. Think about the value of trademarks such as Coca-Cola, McDonald’s, IBM, Kodak, Xerox, Sony and Walt Disney—it is no wonder that trademark battles can be intense and drawn out, with large sums of money at stake.
The basic purpose of a trademark is to enable consumers to identify the origin of a product or service. Identifying the origin does not necessarily mean knowing the specific manufacturer, distributor or franchise—it simply indicates an association with a particular source. The idea is that the consumer should be able to have confidence that all goods with a specific trademark are associated with the owner of the mark.
For example, when a viewer sees a television commercial for Hershey’s Kisses, it is reasonable for a person to assume that all Kisses come from Hershey’s. That does not mean, however, that the consumer can assume that all candy bearing the Hershey’s trademark is necessarily actually made by the same company, but simply that Hershey’s has given its consent for, and presumably imposed its standards on, the distribution of the products under its name. In other words, trademarks provide some indication of quality assurance.