Jul272010

Intellectual Property. Can You Use It?

Dr. Gregory Bier University of Missouri College of Business
Dr. Greg Bier
University of Missouri College of Business
Ph.D., Associate Teaching Professor

Who would think an entrepreneur could get in trouble so quickly?  But you can.  The key is to know what is your property and what isn’t.  Do you know when a patent, a trademark, a copyright, or a service mark are appropriate?  These can be complicated, but are used to protect property, intellectual property.  The issues surrounding intellectual property keep a lot of good (?) lawyers employed.  However, with a bit of effort an entrepreneur can protect what is their legitimate intellectual property and prevent others from using it.  This can take time and money and perhaps a trip to seek legal counsel.

Intellectual property often gives an entrepreneur a competitive advantage.  Protecting your brand name, logo, artwork, formulas, etc can build barriers to market entry for your competition.  Protecting these can also maintain the value of your company.  The center of all this is the U.S. Patent and Trademark Office [USPTO.gov], another free government resource.

At the USPTO.gov website an entrepreneur can start by searching for possible business or product names to ensure they are not already in use.  For example, there is no reason to name your product “IPOD.”  A quick search through the Trademark Electronic Search System [http://tess2.uspto.gov/bin/gate.exe] shows that Apple Inc filed a protection application June 22, 2005.  The name was finally registered July 20, 2010.  Before choosing a product or company name a search through the USPTO office would be advisable.

Thinking of establishing a great taco stand?  Better not name it “Taco Bell” or offer “Big Bell Value Menus”.  Taco Bell has both trademark and service mark protection.  There are 4,601 trademark documents relating to “taco” alone!  Big Bell Value Menu is protected…but you can have a “value menu”.  So what’s the difference between a trademark, a service mark, a patent, and a copyright?  According to the USPTO:

  • Trademarks include any word, name, symbol, or device, or any combination, used, or intended to be used in commerce to identify and distinguish the goods of one manufacturer or seller from goods manufactured or sold by others, and to indicate the source of the goods.
  • Service marks (are a specialized type of trademark) include any word, name, symbol, device, or any combination, used, or intended to be used, in commerce, to identify and distinguish the services of one provider from services provided by others, and to indicate the source of the services.
  • Copyrights protect literary, artistic, and musical works.  [copyright.gov]
  • Patents protect inventions, and improvements to existing inventions.

These are the tools to protect your intellectual property.  But why bother?  New (and existing) entrepreneurs often don’t have the resources to fight intellectual property issues.  So make sure what you are using…can indeed be yours.

In Columbia, Missouri we have a fantastic music/jazz club called The Blue Note.  The Blue Note was started by Richard King in 1980.  In 1985 the Bensusan Restaurant Corporation applied for and successfully registered the name, “The Blue Note”, for their New York based jazz club.  In 1993 Mr. King got a letter from the Bensusan Restaurant Corporation asking him to refrain from using the name, “The Blue Note”.  Mr. King disagreed and nothing happened in the name dispute until 1996 when King established a Blue Note website.  Bensusan brought legal action against Mr. King’s The Blue Note for trademark infringement (Bensusan Restaurant Corporation v King 126 F.3d 25 (2d Cir. 1997)).  However, after a significant legal battle the case by Bensusan Restaurant Corporation was dismissed [http://itlaw.wikia.com/wiki/Bensusan_v._King].  The logic behind the dismissal of the trademark dispute has a significant impact on entrepreneurs today.  Without all the legalese, the case came down to market niche, Mr. King’s local Columbia, Missouri jazz club was not competing against the Blue Note in New York.  Even with a web site with world-wide view-ability it was clear that Mr. King’s audience was Columbia, Missouri.

It can cost a significant amount of time and money to settle a legal issue that could have been resolved at the business planning stage.  Ensure that what you use, names, brands, logos, etc can be used…then protect this intellectual property appropriately.   Also, just because a domain name is available doesn’t mean that it can necessarily be used as your company name.  It would pay to check and see if the name is already someone else’s intellectual property even though the domain name is available.  It’s easy…the government will help you do it [http://www.uspto.gov/teas/eTEASpageA.htm].  How often have you heard that before?

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