Friday, February 27, 2009

Protecting 50-State Database

Dear Rich: My company has developed a database tool that allows people to review different rules in all 50 U.S. states. We're about to show it to some outsiders who might want to license it. Should we patent it? What should we do to protect it? I'm so glad you asked. The short answers to your questions are "Maybe" and "a few things." 
It seems like there are two things you'd like to protect: a database of information; and a tool that organizes and/or searches that information. As for the tool, if it is novel software code, that code may be protected under copyright law (PDF). The code and software process may also be protected under patent law. You say you're going to show this tool to outsiders soon. You don't need to be concerned about copyright protection, since you have a copyright on the software regardless of whether you register it. As for patent protection, you can preserve your rights by filing a provisional patent application before you show it to outsiders. A patent attorney can advise you, or your can use Nolo's online provisional patent application filing system. In reality, the filing is unlikely to do that much good because your right to go after those who infringe the patent won't kick in until you get the patent (which is years away). But don't give up! There is a way to protect your database tool (and we'll talk about it in a moment). 
As for your database of information, the various rules in the 50 states are likely to be public domain. But what may be proprietary (and protected under copyright law) are: (a) any explanatory or additional language you add; and (b) your selection and organization of the 50-state rules. According to the experts, there are really only six ways to organize data: alphabet, time, number, catergory, location, or hierarchy. According to public domain expert Stephen Fishman, the first three methods are unlikely to be protected; the other three may be protected if you can demonstrate a degree of creativity in the selection. If you're getting the feeling that protecting your database under copyright law will be difficult, you're on the right track. About ten years ago there was a rallying cry for legislation to protect databases -- but nothing ever came of it. (You'd have a better chance of protecting your database in Europe.)
So what's a database owner to do? According to the Dear Rich staff, your best approach is to use contract and trade secrecy law. End users who access your database should agree to an End User Agreement (EULA) that prohibits pilfering the tools or proprietary information. For example, that's the approach that eBay successfully used against Reverseauction.com to protect its customer database. Contractors who work on your database should sign nondisclosure agreements. When showing your database and tools to outsiders, use a typical nondisclosure agreement (here's an example). Some outsiders may balk at signing NDAs, particularly if they're already working on something similar, but a laywer can tweak the agreement to satisfy everyone. And of course, if you do license it, your license should require EULAs for end users and an assurance that the licensee won't challenge your proprietary claims to the database and tool.

Wednesday, February 25, 2009

R&D Trade Secret Ownership

Dear Rich: In your book, Patent, Copyright and Trademark: An Intellectual Property Desk Reference, you write, "Trade secrets that arise from research and development activities conducted by manufacturing concerns belong to the company sponsoring the research and development." Can you provide any case citations supporting that statement? I'm so glad you asked. As the entry from the book also indicates, these are general rules and dependent upon the circumstances of the trade secret's creation. As the Supreme Court established, trade secret laws encourage research and development by supplementing the patent system and supporting innovators who seek to retain the value of their discoveries. However, to be sure that R&D is owned by the company sponsoring the research, these criteria must be satisfied: (1) the R&D must have commercial value and be unknown by competitors, (2) the information must be treated with secrecy, and (3) the R&D must have been created by an employee within the course of employment or by an independent contractor bound by a nondisclosure agreement. If you're looking for trade secret case citations, the Dear Rich staff recommends R.M. Halligan's "Trade Secrets Case Database." BTW, the Dear Rich staff has created a website where you can find information about trade secrets as well as free NDAs.

Sunday, February 22, 2009

D'oh! Using Homer Simpson's Image on a Website

Dear Rich: I have a question. Would I be allowed to have an image of a licenced character -- let's say Homer Simpson -- as an example on my website? The site will have Google's Adsense on it, so technically I will be commercially exploiting a licensed character even if the revenue will be quite small. What sort of copyright info would I need to display on my website as not to be in breach of any copyright rules and regs? I'm so glad you asked. Regardless of how little money you make at your site, using a character like Homer Simpson without permission will violate copyright laws and most likely violate trademark laws. That said, 20th Century Fox (Homer's "owner") appears to be somewhat tolerant of website reproductions of "stationary-frame" images -- at least they were ten years ago, based on this letter from Fox's lawyers). That letter also provides proprietary and disclaimer language that you can add at your site. Fox obviously polices unauthorized Simpsons uses (including infringements by the U.S.  government). But Fox's hesitancy to go after single-image reproductions of Simpsons characters may have something to do with angering fans, as well as the huge task of going after the large volume of unauthorized images of Homer on the web. (Our last Google image search showed 586,000 results. D'oh!). Nevertheless, the Dear Rich staff believes that if you wish to stay below Fox's radar, one way would be to avoid providing audio or video clips, or any other downloadable Simpsons materials.

Friday, February 20, 2009

Publishing Lyrics at Websites

Dear Rich: I have a question. I am helping to create a website and one of the components is to provide some advice about songs and music that might be appropriate for funerals. I'd really love to include the lyrics so that folks could peruse them, along with a link to a spot where the piece is being performed. But I am a wee bit worried about spending sleepless nights in jail for including the lyrics -- even though they're all widely available on many sites. We did not intend to offer any commentary, just the bald lyrics. Will I run into a legal problem? I'm so glad you asked. The short answer to your question is that you will be violating the law, but that you probably won't run into problems. Publishing lyrics without authorization is a violation of U.S. Copyright law. Back in the old days (before the year 2000), music publishers went after lyrics websites with a vengeance. Now, unauthorized lyric reproduction is rampant. That doesn't mean that music publishers are tacitly permitting it; they're still sending out DMCA takedown notices and they're even considering going after Google, whose search engine is part of the profit-making machine in which lyrics are used to sell ringtones, affiliate products, and Google Ads. They've also set up a legit alternative -- in April 2007, Yahoo and Gracenote created an online lyrics license service that includes rights to lyrics from some (but not all) of the major music publishers. But that service has yet to click for legitimate lyric licensing the way iTunes has clicked for legitimate downloads. In summary, the Dear Rich staff does not want you to get nasty letters from lawyers but the staff believes that the odds of getting such a letter are slim.

Tuesday, February 17, 2009

Divorce and Copyright


Dear Rich: I have a question. Before our divorce, my ex-husband copyright registered an unpublished song he wrote naming me as the sole "copyright claimant". If he publishes or records the song for sale without my consent, can I file a copyright infringement claim against him even though he is the original author? I'm so glad you asked. The short answer to your question is, "Maybe." [BTW, the Dear Rich staff is sorry to hear about your marital woes (even though the subject of divorce has made for some lucrative hit songs and parodies).]
Our first question is whether there is a written document that evidences the transfer between you and your ex-hubby -- any document, note or memorandum establishing  the arrangement and signed by your ex. That's required under Section 204 of the Copyright Act. One case (involving vampire-novel author Anne Rice) indicates that the document needs to express the terms of the transfer -- that is, how much each party gets for the transfer -- so it can serve as a guidepost for resolving disputes. 
If you don't have this written document, you may have a hard time asserting your rights. Assuming you can satisfy this requirement and you are the sole copyright claimant, then you  would control all rights under copyright law. You could prevent your ex from recording and releasing the song. But if you're just doing it to be spiteful -- that is, without a good business reason -- your ex may have an argument that you're acting in bad faith under the terms of the written agreement and that could cause problems in a court battle.  
Another issue to consider is how the copyright was treated in the divorce proceedings. Your husband may have a claim to some portion of it under the ultimate property division. (This Nolopedia article may help). Since all of this may seem much more complicated than you originally expected, and since the Dear Rich staff prefers that everybody gets along (and that you avoid legal fees), you may want to draft a written statement with your ex -- assuming you're still on speaking terms --  that addresses these issues, provides for a financial payment in the event the song is a hit, and allows you to retain copyright ownership.

Saturday, February 14, 2009

Reselling Apple Products

Dear Rich: I have a question. Am I allowed to sell Apple computers without being an authorized dealer? I'm so glad you asked. The short answer to your question is, "Yes."
You can re-sell Apple products (and advertise that you do so) as long as you 1) don't mislead consumers into believing that you are an authorized dealer or agent of Apple, 2) don't modify the Apple logo, and 3) don't replace the Apple-authorized parts with third-party parts. For example, a few years ago, a company was prevented from reselling Rolex watches after it swapped out watch parts but kept the Rolex faceplate.
Apple has strict standards for its resellers and it warns consumers who purchase from non-authorized resellers. Still, Apple cannot prohibit someone who legitmately acquires branded versions of its products from reselling them.This principle is referred to as the first-sale doctrine (or  trademark exhaustion). Simply put, a reseller who offers branded goods without modifying those goods does not need authorization and is not an infringer. According to the the Dear Rich staff, things may get a little more confusing if you are selling parallel imports (also known as gray market goods). These are Apple products manufactured for sale in territories outside the U.S. and imported and sold in the U.S. (or vice versa). Apple would have a better argument stopping the sale of gray market iPods or Macs, particularly if the imported models do not have all the features or service benefits of their U.S. counterparts. Apple would also have an easier time stopping gray market sales in some European countries which do not have similar first-sale rules.

Sunday, February 8, 2009

Cover me: Your right to reproduce copyrighted packaging

Dear Rich: I have a question. I'm starting a literary website and I'd like to put up a lot of book covers. Do I have to get permission from the book publishers? I'm so glad you asked. Chances are you won't have to ask for permission because of an exception under copyright law (17 USC Sec. 113(c)) that permits you to display pictures of product packaging "in connection with advertisements or commentaries" related to distribution or sales of those products. So, for example, if you provide links to an online retailer like Amazon where the books can be purchased, you will qualify under this exception. Ditto if you're acting as a journalist and commenting on the book. By the way, this exception applies for any "useful article," not just books. So it also applies to the cover of the "Crunch: Belly Butt and Thighs Bootcamp" DVD, the Pizza Party Elmo toy, and my super favorite new album.

Thursday, February 5, 2009

When is a photographer "hired"?

Dear Rich: I have a question. In one answer to photography copyright you state that a photographer has copyright to pictures unless he or she is hired and then in another blog you state that a wedding photographer holds copyright. Isn't the wedding photographer hired 9 times out of 10? As the Dear Rich staff stated in one entry, "If you took the picture, you own the copyright (with exceptions, if you were hired to take it)." 

So here are your take away points: A photographer will own all rights to an image taken unless (1) the photographer assigns, licenses, or otherwise transfers rights to someone else (you'll know if you've done that because you have to reach an agreement with someone); or (2) the image is considered a work made for hire, in which case the hiring party owns it.

A photograph will be considered a work made for hire in one of two ways. The first way is if it was taken in the course of employment (for example, an image of Barack Obama taken by an employee of the Associated Press). The second way -- and you must meet all three of these conditions -- is that the photographer was commissioned, signed a written agreement acknowledging the photos are works-made-for-hire, and (perhaps most importantly) the job assignment falls within one of a few specific categories listed in copyright law.

Since most wedding photographers are not employees and don't use written work-made-for-hire agreements -- and since it's questionable whether wedding photos will fall within the enumerated categories listed in the law -- wedding photographs are, as a general rule, not likely to be works made for hire. One caveat: Our helpful staff uncovered this article which points out that if you operate your photography business as a corporation or LLC, you will be an employee of that corporation, and your copyright registration must reflect that status.

When is a photographer "hired"?


Dear Rich: I have a question. In one answer to photography copyright you state that a photographer has copyright to pictures unless he or she is hired and then in another blog you state that a wedding photographer holds copyright. Isn't the wedding photographer hired 9 times out of 10? I'm so glad you asked. As our staff stated in one entry, "If you took the picture, you own the copyright (with exceptions, if you were hired to take it)." 
So here are your take away points: A photographer will own all rights to an image taken unless (1) the photographer assigns, licenses, or otherwise transfers rights to someone else (you'll know if you've done that because you have to reach an agreement with someone); or (2) the image is considered a work made for hire, in which case the hiring party owns it.
A photograph will be considered a work made for hire in one of two ways. The first way is if it was taken in the course of employment (for example, an image of Barack Obama taken by an employee of the Associated Press). The second way -- and you must meet all three of these conditions -- is that the photographer was commissioned, signed a written agreement acknowledging the photos are works-made-for-hire, and (perhaps most importantly) the job assignment falls within one of a few specific categories listed in copyright law.
Since most wedding photographers are not employees and don't use written work-made-for-hire agreements -- and since it's questionable whether wedding photos will fall within the enumerated categories listed in the law -- wedding photographs are, as a general rule, not likely to be works made for hire. One caveat: Our helpful staff uncovered this article which points out that if you operate your photography business as a corporation or LLC, you will be an employee of that corporation, and your copyright registration must reflect that status.

Monday, February 2, 2009

Trademarks and Religion

Dear Rich: I have a question. Is the name of a religion trademarkable? Why was "Christian Science" ruled generic and untrademarkable, while "Seventh-day Adventists" is trademarked? I'm so glad you asked. The short answer to your first question is "Yes." Your second question, alas, is not so simple.
Trademark issues regarding religion typically arise when dissidents of a religion splinter off, sometimes claiming to embody the "real" tenets of the original religion. A dispute then arises as to whether the offshoot can use the religion's name. According to the Dear RIch staff, that's what happened in both cases you cited.
Mary Baker Eddy founded Christian Science in 1866, and then in 1889 established the Church of Christ, Scientist. A group of followers later split off and founded their own church, the Independent Christian Science Church of Plainfield. A dispute arose as to who had the right to use the term CHRISTIAN SCIENCE. In 1987, the New Jersey Supreme Court ruled (Christian Science Board v. Evans) that CHRISTIAN SCIENCE was generic because the term and underlying precepts of Christian Science preceded the religious organization by 23 years and should therefore be free for all to use. (As one commentator noted, it was an odd point for the court to base its decision on, since most religious principles precede the resulting organization.) However, the name of the church -- Church of Christ, Scientist -- was not generic and was protectable. In a subsequent California case, decided in 2000 (Christian Scientist Board v. Robinson), a federal court made a contradictory ruling when it refused to find the term CHRISTIAN SCIENCE to be generic and ruled that two entities might coexist and claim rights if additional wording is added to avoid confusion -- for example, the Indepenent Christian Science Church. In any case the church founded by Mary Baker Eddy and the Christian Science Publishing Company have acquired additional trademark registrations, including several for the term CHRISTIAN SCIENCE.    
The Seventh Day Adventist case, decided in 2000 (Stocker v. General Conference Corporation of Seventh-day Adventists), was a decision by the Trademark Trial and Appeal Board (TTAB). The TTAB ruled that since the Seventh-day Adventists had been using the trademark on its publications for over 130 years, the term was not generic and the church was entitled to maintain trademark rights.
As you may have realized, there are two tricky aspects to the application of trademark principles to religion. One is that the government is prohibited under the establishment clause of the Constitution from getting involved in the "establishment" of religion. So, in order to apply trademark law, the courts must not rule on which religion best expresses the virtues of its founder -- whether that means deciding which Sufi founded a sect, or which church best presents the views of Mary Baker Eddy. The second concern is that trademarks are signifiers for products or service in commerce and it is sometimes difficult to apply these "corporate" principles to religious entities.
The Dear Rich staff reports that you can learn everything you ever wanted to know about trademarks and religion by downloading this law review article, or by reviewing the entry on trademarks and religion in The Encyclopedia of American Civil Liberties, an excellent resource for all things that seem unfair.
P.S. This blog has again been reprimanded for permitting the use of "trademark" as a verb (see question above). As it is painful for us to receive such reprimands, please be advised that if you use "trademark" improperly in the future, we will be required to correct your question before publishing it.

Sunday, February 1, 2009

Can't Make Sense of Internet Patents


Dear Rich: I have a question. Can you explain how a common sense thing like "selling pictures online" can be patented? I read recently about a settlement by Pictage against a company that had patented a method for selling pictures online. Where's the sense in this? Why isn't just the code for the method protected and not the idea? I'm so glad you asked. As to your first question -- where's the sense in this? -- the Dear Rich staff is unable to provide an answer except to say that "common sense" and the law are, at best, distant cousins.
As to your second question, our staff believes you may be mixing copyright and patent law. Under copyright law, the code, and not the method of business would be protected. Under patent law, the business method is protected, which is why so many companies sought and obtained iffy patent protection for their online commerce systems during the dot-com boom (one-click shopping anyone?). Many of these patents -- such as the patent at issue ("method and apparatus for storing and printing digital images") -- were filed during the period preceding the bursting Internet bubble and recently, a dispute about one such patent (filed in 1997), has stirred up issues regarding the legitimacy of all so-called Internet or business-method patents. As pointed out elsewhere, the company that owns the patent at issue doesn't operate a digital photo website; it appears to exist as a patent-holding company that pursues infringers, an entity sometimes derogatorily referred to  as a patent troll. Although this blog prides itself on providing practical information (and we don't want you to shy away from doing the right thing), we do suggest staying out of the way of  patent trolls since they are expert at steam rolling those who cannot afford to take them on in court.