IP Taxonomy

UTILITY PATENT

The gold standard of IP: strong and fairly broad protection, but expensive and slow to obtain. When people talk about “patents,” they’re almost always referring to this kind of patent (as opposed to design patents—see below).

Utility patents protect inventions—ideas that are both useful and novel (and non-obvious)—for a limited period of time. You can get patents on all manner of inventions: machines, medicines and other chemicals, methods and processes (including most business methods), and even software (if you couch it the right way). The invention need not be earth-shattering: fairly modes improvements on the state of the art are eligible.

More important, patent protection is not limited to the precise thing you put together (“embodiment of the invention,” in legal-speak), you just need to explain it well enough that someone “of ordinary skill in the art” could do so.

Since the consequences of infringing the patent can be quite harsh, patents have proven to be powerful competitive tools or revenue streams. They are also identifiable assets, which can be sold or licensed. Indeed, some investors will insist that you at least have an application on file.

All this power comes at a price. Patents take years and lots of fees to obtain, and there’s no guarantee that you’ll get a patent in the end—your idea may not have been as novel as you thought it was. Also, for every crucial patent that commands a big revenue stream, there are 10 that are just gathering dust. You’ll need to decide whether your idea is important, valuable and novel enough to risk the costs to obtain one.

COPYRIGHT

Where patents protect novel and useful ideas, copyright protects original, non-functional expressions. In the public imagination, copyright protects things like novels, paintings, movies, songs, photographs, and other imaginative and highly creative works. But, in fact, copyright also covers more quotidian things like software code, marketing collateral, and webpages—indeed, anything that is expressive and has some minimal amount of creativity.

Copyright does not cover ideas, facts and pure data, however. Thus, you can patent the rules of a game, but you may not copyright the rules, only the specific way you express the rules.

Or, you may patent a software-driven process, but you may copyright only the specific way you coded the software (see Rick’s coverage of the Oracle v. Google case involving Java and the Android operating system).

Unlike patents, copyrights arise automatically as soon as you “fix” your expression in a “tangible medium” (paper, hard drive, flash drive, canvas, celluloid, etc.). However, proper enforcement of a copyright requires and benefits greatly from registration of the copyright with the U.S. Copyright Office.

Copyright registration is a straightforward and inexpensive process, fortunately, but then you’ll probably develop many more copyrighted works than patentable ideas. Copyright infringement can be surprisingly harsh, but usually only if the copyright is timely registered. For more detail about copyright, see our “40,000-feet view” here.

TRADEMARKS

Trademarks protect your relationship and reputation with your customers and potential customers. They’re how the consuming public knows you and your products. Not everything can be a trademark, of course. You can’t have APPLE-branded apples, thought you can obviously have APPLE-branded computers.

You also need to be first to use the trademark in commerce in the market. If you’re going to promote products by telling folks to OWN YOUR POWER, you might want to make sure someone isn’t already using OWN YOUR POWER for something similar, even if you’re Oprah.

Then again, sometimes there’s more room for the same or similar marks than you might think, so long as the markets are sufficiently different. That’s how we tolerate DELTA airlines, DELTA faucets and DELTA dental insurance.

Like copyrights, trademarks arise on their own without the need to ask the government for anything. In the case of trademarks, they arise from using the trademark in a way that connects your product with you, or perhaps more accurately, with a certain level of quality.

Having said that, like copyrights, there are benefits to registering your trademarks with the federal government. The process of registration is a bit like getting a patent, in that it’s pretty expensive (though not nearly as much as for a patent), takes some time (18 months or so), and doesn’t always result in success, since an examiner can reject the application, and third parties can actually intervene in the process and can “oppose” your application.

TRADE SECRETS

Trade secrets are often described as the flip-side of a utility patent, in that patents make public things that were or would otherwise be secret, but at the cost of a limited monopoly.

That’s not entirely true, because trade secrets cover much more than patents can. While you can get a patent only on inventions (useful, novel and non-obvious), you can get trade secret protection for ideas, process, and contraptions that aren’t, strictly speaking, inventions.

You can also get trade-secret protection for information, such as customer lists, financial figures and business plans. Anything that gives you an advantage because your competitors don’t know it can be a trade secret. On the other hand, trade-secret protection is of limited value if the public can reverse-engineer a product to discover the secret, something that’s not a problem with patents.

Trade secrets have no expiration date. The formula for Coca Cola has been protected for decades, for example. Such protection comes at the price of eternal vigilance, or at least reasonable steps to keep the information secret. Get too lax with your security measures and you can lose your trade-secret protections.

It’s not impossible to safely share your trade secrets with others, but you need to make sure everyone is subject to a well-drafted non-disclosure agreement.

Rarely, a company will deliberately forego patent protection because it feels the invention’s value would outlive the period of protection offered by patents. More commonly, companies will combine a patent on the reverse-engineerable part of an invention with trade secrets on parts that are more easily kept secret.

PUBLICITY RIGHTS

Publicity rights are sometimes regarded as the flip-side of copyright. Whereas the copyright belongs to the artist, writer or photographer, publicity rights belong to the human subject of the painting, article or photograph. Thus, one sometimes obtains permissions not only from the copyright holder but from the subject of the work.

Sometimes this miscarries, as was the case for the cover of Vampire Weekend’s Contra album. Not everyone is eligible for publicity rights, and the First Amendment right to free expression also has something to say about the right.

Since publicity rights are creatures of state law, which vary tremendously from state to state (usually in relation to how many celebrities live in the state, or if Elvis Presley lived there), much will depend on which state’s law governs. For the record, Tennessee has one of the strongest publicity rights laws in the nation.

DESIGN PATENTS

Honestly, we’re including this for completeness, though recents events (namely, Apple’s recent jury verdict against Samsung, in which a design patent figured prominently, has caused lawyers to reassess the value of design patents.

Like utility patents, design patents are issued exclusively by the federal government, and must be novel and non-obvious. But whereas utility patents go to the functional aspects of an invention, design patents go to ornamental aspects of “an article of manufacture.”

In theory, they’re more powerful than copyright protection because you don’t need to prove copying, only similarity, and they can cover some designs that copyright won’t. But they’re still patents, which means it takes money and time to obtain one (though not nearly as much for utility patents.)

RELATED LAWS

In addition to the foregoing major types of intellectual property, there are a hodgepodge of federal and state statutes that confer IP-like rights. Perhaps most notable among these are anti-0circumvention aspects of the Digital Millennium Copyright Act that can, if used correctly, protect information not otherwise subject to copyright, like databases.

Further, well-constructed contract provisions—e.g., anti-scraping provisions in a website’s terms of use, if properly implemented—can give one party IP-like protections over things that would not be protectable.