Trademark vs Copyright vs Patent

It can be challenging to keep intellectual property straight. This article provides an overview for startup founders and operators about the differences between copyrights, trademarks, patents and trade secrets — all forms of intellectual property that provide legal protection to creators and innovators. We will define each type of intellectual property and explore the types of content each protects. Additionally, we will examine the rights granted to owners of each type of intellectual property, the duration of protection, and the costs associated with obtaining and maintaining that protection. Finally, we will discuss the importance of understanding these differences and the steps individuals and companies can take to protect their intellectual property.

Of course, every situation is unique, so you’ll want to speak with legal counsel to understand what’s best for you. If you’re looking for counsel, feel free to reach out to us here.

Copyright

Copyright is a legal right that grants the creator of an original work exclusive control over its use and distribution.

The copyright holder has control over copying and other uses for a specific period of time. After that, the work enters the public domain. Uses covered under exceptions to copyright, such as fair use, do not require permission from the owner. All other uses require permission, and owners can license or assign their rights to others.

Examples of Copyright-Protected Content

Copyright law covers a broad range of creative, intellectual or artistic forms, or “works.” Here are some examples:

1. Books, manuscripts and other literary works
2. Musical compositions and sound recordings
3. Drama and dance choreography
4. Artistic works, including paintings, sculptures, drawings and photographs
5. Film and television broadcasts
6. Computer software and databases
7. Architectural designs

Rights Granted to the Copyright Owner

Copyright gives the owner the exclusive right to:

• Reproduce the Work. The copyright holder has the exclusive right to make copies of the work.
• Distribute Copies of the Work. This includes the right to sell, lend or lease copies.
• Publicly Display the Work. This refers to the right to display the work in public, online or in any public space.
• Make Derivative Works. This includes any adaptations or modifications to the work, such as translating a book into another language, adapting a novel into a film or remixing a song.

Duration of Copyright Protection

The length of copyright protection can vary depending on the type of work and who created it, but generally, for works created by an individual, copyright protection lasts for the life of the author plus 70 years. For works made for hire, anonymous or pseudonymous works, the copyright lasts 95 years from the year of first publication or 120 years from the year of creation, whichever is shorter.

Cost of Copyright Registration

In the United States, the filing fees for registering a copyright with the U.S. Copyright office is minimal — under $100. The registration process can be done online or by mail. However, a work is under copyright protection the moment it is created and fixed in a tangible form, even if it’s not registered. Registration, while not mandatory, provides certain legal advantages, such as the ability to sue for infringement and the eligibility to receive statutory damages and attorney’s fees in successful litigation.

Trademark

A trademark is a symbol, word or phrase used to identify and distinguish a company’s goods or services from those of others. It is a type of intellectual property that provides legal protection to the owner against others using a similar mark that could cause confusion among consumers. The owner of a trademark has the exclusive right to use the mark in connection with their products or services and can prevent others from using a similar mark in a way that could cause confusion or dilution of the brand.

Examples of Content Protected by Trademarks

• Brand Names. For instance, Nike, Apple and Coca-Cola are all trademarked brand names.
• Logos and Symbols. The Nike swoosh, the “apple” and McDonald’s golden arches are all examples of trademarked logos.
• Slogans Catchphrases or slogans like Nike’s “Just Do It” or McDonald’s “I’m Lovin’ It” are also protected by trademark.
• Colors. Some brands have trademarked specific colors associated with their business, like Tiffany Blue for Tiffany & Co.
• Sounds. Some sounds associated with a company can also be trademarked. For example, the “Intel Inside” chime and the MGM lion’s roar are both trademarked sounds.

Rights Granted to the Trademark Owner

Trademark rights allow the owner to:

• Exclusive Use. The owner of a registered trademark has the exclusive right to use their mark in relation to the products or services for which it is registered.
• Prevent Unauthorized Use. The owner can prevent unauthorized use of the trademark in connection to products or services that are identical or similar to the ones for which they have registered the trademark.
• Legal Remedies. The owner may seek legal remedies if their rights are infringed. This can include damages, injunctions, account of profits or a declaration that the trademark is valid and infringed by the defendant.

Duration of Trademark Protection

Trademark rights are typically protected as long as the trademark is being used in commerce and defended against infringement, and as long as the registration is maintained. In the U.S., a trademark registration can last indefinitely, but it must be renewed every 10 years and you must file a “Declaration of Use” between the 5th and 6th year following registration.

Cost of Trademark Registration

In the United States the cost of filing a trademark application with the U.S. Patent and Trademark Office is between $250 – $500 per mark per class of goods/services, depending on the type of application form. There may also be additional costs for maintaining and renewing the trademark, as well as any legal fees if you hire a lawyer to assist you with the process.

As with copyright, costs, durations and processes may vary by jurisdiction, so it’s advised to consult with an intellectual property attorney or expert to understand the specifics related to your work and location.

Trade Secrets

A trade secret is proprietary information such as a formula, practice, process, design, instrument, pattern, commercial method or compilation of information, which is not generally known or reasonably ascertainable by others, and by which a business can obtain an economic advantage over competitors or customers.

Examples of Trade Secret Content

• Manufacturing Processes. A company’s unique method for manufacturing its products gives it an edge over competitors.
• Recipes. A famous example is the Coca-Cola formula, which has been a closely guarded trade secret for over a century.
• Algorithms. Search engines like Google use proprietary algorithms for their search functionality, which are considered trade secrets.
• Customer Lists. A business’s customer list may be protected as a trade secret if it has been developed over time and gives the business a competitive advantage.
• Business Strategies. A unique business strategy that gives a company a competitive advantage can also be a trade secret.

Rights Given to the Trade Secret Owner

Unlike other forms of intellectual property such as patents, copyrights and trademarks, there is no formal government registration process for a trade secret. The protection of a trade secret arises from the fact that it is kept secret, not from a formal registration with a governmental body. This secrecy, and the business advantage it provides, is what gives a trade secret its value.

To protect trade secrets, companies typically rely on a combination of physical, technical and contractual measures.

• Physical and Technical Measures. This can include things like limiting access to areas where sensitive information is stored, using secure databases and networks to store digital information, encrypting sensitive data, and limiting the distribution of sensitive information within the company.
• Contractual Measures. The contractual protection of trade secrets usually involves confidentiality agreements (NDAs or CIIAs). These agreements are contracts between the company and its employees, contractors, vendors or any other party who may have access to the company’s trade secrets. The agreements generally stipulate that the party is aware that they are receiving confidential information and they promise not to disclose this information to anyone else. In addition to NDAs and CIIAs, companies often include confidentiality clauses in employment contracts and in agreements with other businesses. These clauses usually obligate the party to keep the confidential information secret, use it only for specific purposes, and return or destroy the information when the agreement ends or when the company requests it.

If a party violates these agreements, the company can sue them for breach of contract and seek damages. However, if a company fails to take reasonable steps to protect its trade secrets, it may not be able to enforce its rights in court. Therefore, it is essential for startups to establish a solid strategy from the outset.

Duration of Trade Secret Protection

Trade secrets can be protected indefinitely as long as they remain confidential and continue to provide a competitive advantage to the business. Once the secret is disclosed or independently discovered and made public, the protection likely ends.

Cost of Trade Secret Protection

The cost of protecting a trade secret can vary significantly depending on the security measures taken to keep the secret confidential. These can include physical security measures, digital security software and infrastructure, employee training, and legal costs associated with drafting confidentiality agreements or pursuing legal action against those who violate these agreements. However, unlike patents or trademarks, there is no formal registration process or fee for protecting a trade secret. The cost primarily involves maintaining the confidentiality of the information.

Patent

A patent is a form of intellectual property that gives its owner the legal right to exclude others from making, using, selling and importing an invention for a limited period of years. Patents are granted by a government to an inventor, giving the inventor the right to stop others from using their invention. In exchange for this right, the inventor makes technical information about the invention publicly available in the published patent document.

Examples of Patentable Content

• This includes any kind of machine or apparatus such as engines, mechanical tools or a new type of washing machine.
• Manufactured Items. This category includes anything that is made by humans or machines such as fibers, foods or genetically modified organisms.
• This covers chemical, mechanical, electrical or informational processes such as a new method of distilling alcohol, a new coding algorithm or a new manufacturing process.
• Compositions of Matter. This includes chemical compositions and may cover pharmaceuticals, chemical compounds and certain types of genetically modified organisms.
• Google’s PageRank Patent. Google’s early success was built on a patented algorithm known as PageRank, which ranks web pages based on importance. This patent was one of the key intellectual properties that made Google’s search engine unique and powerful.
• Snap Inc.’s Augmented Reality (AR) Patents. This company behind Snapchat has been awarded numerous patents related to augmented reality (AR) technologies, including the technology used for its popular AR lenses.
• Square’s Mobile Payment System. This company has patented various elements of its mobile payment system, including its card-reading device and the underlying technology. One of its important patents covers a system and method for financial transaction authentication with a user challenge.
• Zoom’s Video Communication Patents. This tech company has numerous patents related to its platform, including patents on its system for initiating and maintaining video conferences.
• Slack’s Real-Time Messaging System. This technology service holds a patent on its system and method for real-time messaging, one of the main features that set Slack apart from other collaboration tools.

Rights Given to the Patent Owner

The owner of a patent can:

• Exclude others from making, using, selling or importing their patented invention.
• License the patent to others in exchange for royalty payments or other benefits.
• Sell the patent to another party, which would then own the exclusive rights.
• Sue for damages if someone infringes on the patent.

Duration of Patent Protection

In the United States, the term of a new patent is typically 20 years from the date on which the application for the patent was filed. There are certain circumstances where this term can be extended, or where patents have different terms, such as design patents, which have a term of 15 years from issuance for applications filed.

Cost of Patenting

The cost of obtaining a patent can vary greatly, depending on the complexity of the invention, the type of patent and the attorney fees. In the United States, the process can cost a minimum of a few thousand dollars for a relatively simple invention to tens of thousands of dollars for a complex one.

This includes filing fees paid to the United States Patent and Trademark Office (USPTO), which can range from under $1,000 for small entities, and legal fees, which can range from $10,000 to $60,000 or more, depending on the complexity of the invention and the amount of work involved in preparing the application. There are also maintenance fees to keep the patent active.

Remember, obtaining a patent does not guarantee commercial success or a positive return on the investment made in obtaining the patent. However, a patent can provide the right to exclude others from commercially exploiting the invention, potentially creating a significant business opportunity.

Patents can be valuable assets for startups. They can help protect innovative technologies from being copied by competitors, attract investment and potentially be a source of revenue if licensed to other businesses. However, obtaining and maintaining patents can be costly and time-consuming, so startups need to strategically decide when and what to patent.

In conclusion, copyrights, trademarks, patents and trade secrets are all forms of intellectual property that provide legal protection to creators and innovators. While they share some similarities, they each protect different types of intellectual property and offer different rights to their owners. It is important founders and operators to understand these differences and to take the necessary steps to protect their intellectual property. This may include registering their work, establishing confidentiality agreements and taking legal action against infringers. By doing so, they can ensure that their creative and innovative works are protected and that they can reap the benefits of their hard work and ingenuity.

Startups should work with legal counsel to devise the best intellectual property strategy for their company. If you’re looking for counsel, feel free to reach out to us here.