Scribd
Upload
4 views

Ch 6

Chapter 6 discusses the importance of understanding intellectual property (IP) for entrepreneurs, including patents, trademarks, copyrights, and trade secrets, and emphasizes the need for legal advice in protecting these assets. It outlines the types of patents available, the process for applying for them, and the significance of trademarks and copyrights in business. Additionally, the chapter covers legal considerations in setting up an organization, the role of licensing, product safety, insurance, and the conditions and implications of contracts.

Uploaded by

RaJa MuJeEb
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
4 views

Ch 6

Chapter 6 discusses the importance of understanding intellectual property (IP) for entrepreneurs, including patents, trademarks, copyrights, and trade secrets, and emphasizes the need for legal advice in protecting these assets. It outlines the types of patents available, the process for applying for them, and the significance of trademarks and copyrights in business. Additionally, the chapter covers legal considerations in setting up an organization, the role of licensing, product safety, insurance, and the conditions and implications of contracts.

Uploaded by

RaJa MuJeEb
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 20

CHAP#6

PROTECTING THE IDEA AND OTHER LEGAL ISSUES FOR THE


ENTREPRENEUR
WHAT IS INTELLECTUAL PROPERTY
• Intellectual Property—which includes patents, trademarks, copyrights, and trade
secrets—represents important assets to the entrepreneur and should be
understood even before engaging the services of an attorney. Too often
entrepreneurs, because of their lack of understanding of intellectual property,ignore
important steps that they should have taken to protect these assets.
• NEED FOR A LAWYER: business is regulated by law, entrepreneur will need legal
advice.
• HOW TO SELECT A LAWYER: specialists in field, risks handler, more up-front about
their fees, good working relationship, resources are very Limited in start, Once the
patent is obtained this lawyer would not be needed, competent attorney is in a better
position to understand all possible circumstances and outcomes related to any legal
action.
LEGAL ISSUES In SETTING UP THE ORGANIZATION
• Legal advice for these agreements is necessary to ensure that the mostappropriate
decisions have been made.
• understand all the advantages and disadvantages of each regarding suchissues as
liability(Quality), taxes, continuity, transferability of interest, costs of setting up, and
attractiveness for raising capital.
PATENTS
• Grants holder protection from others making, using, or selling a similar idea.
Patent is a contract between the government and an inventor.
• Utility patents: A utility patent has a term of 20 years, beginning on the date of
filing with the Patent and Trademark Office (PTO). A utility patent basically grants
the owner protection from anyone else making, using, and/or selling the identified
invention and generally reflects protection of new, useful, and unobvious processes.
• Design patents: Covering new, original, ornamental, and unobvious designs for articles of
manufacture, a design patent reflects the appearance of an object. These patents
are granted for a 14-year term.
• Plant patents: These are issued under the same provisions as utility patents andare
for new varieties of plants. These patents represent a limited area of interest.
International Patents
• As international marketing increases in our age of rapid technological development.
• The USPTO has established the Office of International Patent Cooperation in order
to decreasethe uncertainty of IP rights while also reducing costs. Its role is to move
toward a much more harmonized patent system.
The Provisional Application
• Entrepreneur first file a provisional patent application to establish a date of
conception of theinvention.
The Patent Application
• The patent application must contain a complete history and description of the invention
as well asclaims for its usefulness.
• Introduction This section should contain the background and advantages of the
invention and the nature of problems that it overcomes. It should clearly state how
the invention differs from existing offerings.
• Description of invention Next the application should contain a brief description of
the drawings that accompany it.
• Claims This is probably the most difficult section of the application to prepare since
claims are thecriteria by which any infringements will be determined.
Checklist for Minimizing Patent Risks

• Seek a patent attorney who has expertise in your product line.


• The entrepreneur should consider a design patent to protect the product design or
product look.
• Before making an external disclosure of an invention at a conference or to the
media, orbefore setting up a on site, the entrepreneur should seek legal counsel since
this external disclosure may negate a subsequent patent application.
• Evaluate competitor patents to gain insight into what they may be developing.
• If you think your product infringes on the patent of another firm, seek legal counsel.
• Verify that all employment contracts with individuals who may contribute new
products haveclauses assigning those inventions or new products to the venture.
• Be sure to properly mark all products granted a patent. Not having products marked
could resultin loss or damages in a patent suit.
• Consider licensing your patents. This can enhance the investment in a patent by
creatingnew market opportunities and can increase long-term revenue.
TRADEMARKS
• Atrademark may be a word, symbol, design, or some combination of such, or it could be
a slogan or even a particular sound that identifies the source orsponsorship of
certain goods or services.
• Trademark is given an initial 10-year registration with 10-year renewable terms.
• Trademarks vary widely in their application and use.
• Represent an important asset to the company.
• Filing of the trademark registration must meet four requirements: (1)
completion of the written form, (2) a drawing of the mark, (3) five specimens
showing actual use of the mark, and (4) the fee.
Benefits of a Registered Trademark

• It provides notice to everyone that you have exclusive(limited) rights tothe use of
the mark throughout the territorial limits of the United States.
• It entitles you to sue(right) in federal court for trademark
infringement(violate), which can result in recovery of profits, damages, and costs.
• It establishes incontestable(certain) rights regarding the commercial useof the
mark.
• It establishes the right to deposit registration with customs to prevent
importation of goods with a similar mark.
• It entitles you to use the notice of registration (®).
• It provides a basis for filing trademark application in foreign countries.
COPYRIGHTS
• A copyright protects original works of authorship. The protection in a copyright does
not protect the idea itself, and thus it allows someone else to use the idea or
concept in a different manner.
• Copyright protection related to the Internet will continue to be a concern.
• Besides computer software, copyrights are desirable for such things as books,
scripts, articles, poems, songs, sculptures, models, maps, blueprints,collages, printed
material on board games, data, and music.
• Copyrights are registered with the Library of Congress.
TRADE SECRETS AND NONCOMPETITION AGREEMENTS
• Entrepreneur may prefer to maintain an idea or process as confidential and to sell
or license it as a trade secret .
• Employee in order for the company to protect valuable assets ranging from product
information toclients, marketing ideas, and unique strategies.
• The holder of the trade secret has the right to sue any signee who breaches such
an agreement.
• Train employees to refer sensitive questions to one person.
• Provide escorts(person provide protection) for all office visitors.
• Avoid discussing business in public places.
• Keep important travel plans secret.
• Control information that might be presented by employees at conferences or
published in journals.
• Use simple security such as locked file , passwords on computers, where necessary.
• Have employees and consultants sign nondisclosure agreements.
• Debrief departing employees on any confidential information.
• Avoid e-mailing any sensitive information.
• Mark(make) documents confidential when needed.
LICENSING
• Contractual agreement giving rights to others to use intellectualproperty in
return for a fee.
• Licensing has significant value as a marketing strategy. It is also an important
marketing strategy for entrepreneurs who wish to start a newventure but need
permission to copy or incorporate the patent, trademark, or copyright with their
ideas.
• research and development
PRODUCT SAFETY AND LIABILITY
• Responsibility of a company to meet any legal specifications regarding anew product
covered by the Consumer Product Safety Act.
• When a violation is reported, the commission reviews the report and ifnecessary
orders a recall(more money invest) of the product.
• Food and toys especially should be evaluated prior to any business
development.
INSURANCE
• Insurance provides a means of managing risk in the new business.
• The main problem is that the entrepreneur usually has limited resources in the
beginning. Thus, it is important to first determine whether any of these types of
insurance are needed.
• Types of Insurance (from Book)
CONTRACTS
• A legally binding agreement between two parties.

Contract Conditions
• An offer is made. It can be oral or written but is not binding until voluntary
acceptance of offer isgiven.
• Voluntary acceptance of offer.
• Consideration (something of value) is given by both parties.
• Both parties are competent and/or have the right to negotiate for their firms.
• Contract must be legal. Any illegal activities under a contract are not binding. An
example might begambling.
• Any sales of $500 or more must be in writing.
Results of a Contract Breach
• The party in violation of a contract may be required to live up to the agreement or pay
damages.
• If one party fails to live up to its end of a contract, the second party may also
agree to drop thematter and thus not live up to the agreement as well. This is
referred to as contract restitution.

You might also like