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Capitalizing Intellectual Property

Product Configurations and Packaging

Proper Usage of Trade Names and Trademarks

A trademark, if used properly, may last indefinitely. However, misuse of a mark as a generic or descriptive term can destroy the mark or weaken its scope of protection. Failure to properly use a trademark can ultimately lead to loss of the mark's recognition as a trademark. For example, the generic terms “aspirin,” “thermos,” and “escalator” were once valuable trademarks. Whenever possible, the common or generic term for the product should be used along with the mark to show that the mark is not a generic name of the product (“TIM HORTONS brand decaffeinated coffee”). On packaging and labelling, trademarks should appear prominently and be set apart from other text in order to distinguish the mark from descriptive or generic language. Trademarks should be made visually distinct, by positioning the mark apart from other text, using the word “brand” with the trademark, or by altering its size, font, or colour, or by using a highly stylized version of the trademark.

Use of Symbols

“TM” may be placed after a trademark before an application is filed, to notify the public that the mark is being used as a mark. Alternatively, an asterisk may be used with a legend such as “MARK is a trademark of COMPANY”. After registration, the letter R enclosed in a circle should be placed beside the mark. After registration, the legend may read “MARK is a registered trademark of COMPANY.” Although notice is not mandatory, without it recovery of damages and profits in an infringement suit may not available. To reinforce the public's awareness of an exclusive right to a trademark, an additional claim may be included on packaging or labelling. For example, “Made only by COMPANY,” “Exclusively from COMPANY” or “Only from COMPANY”. Packaging and product configuration may be protectable as distinguishing guise (trade dress in the U.S.), if features such as size, shape, colour or colour combinations, texture, or graphics identify the source of the product, and distinguish the product from products manufactured by other companies. Distinctive and unusual packaging is more likely to be protected as distinguishing guise. The source identifying function of the trade dress can be featured in advertising (such as Owens-Corning's advertising for its pink fiberglass insulation featuring the Pink Panther).

Use of Rules of Grammar

Certain rules of grammar should be followed to distinguish trademarks from generic terms. A mark should be used as an adjective modifying a generic term, and not as a noun or verb (wrong: “buy KLEENEX when you shop next”; correct: “buy KLEENEX tissues when you shop next”). A trademark should not be used in the plural (wrong: “Ron Jeremy wears only ROCKPORTs”; correct: “Ron Jeremy wears only ROCKPORT walking shoes”) or in the possessive form (wrong: “the I.B.M.'s best feature is”; correct: “the best feature of the I.B.M. computer is”).

Patent Marking Requirements

Products incorporating patented technology should be marked with an appropriate notice, such as “Canadian Patent No. 1,234,567.” Although notice is not mandatory, without it recovery of damages and profits in an infringement suit may not available. Actual notice generally pertains to supplying a party with a notice letter that identifies the patent, the patent owner and the infringing product. The notice letter does not need to explicitly charge the party with infringement. Commencement of litigation also constitutes actual notice. The clearly desirable form of notice for patent owners is to provide constructive notice by marking the product. Marking must be consistent and continuous. That is, substantially all of the products sold by the patent owner and its licensees should be marked with the patent number.

Patenting Configurations

If the appearance of a product has value or potential value and that appearance is sufficiently distinct from other similar products, an industrial design application (design patent in the U.S.) covering that appearance may be desirable. All of the requirements for utility patent apply equally to design patents. However, although a feature covered by a utility patent cannot be protected by trade dress, a non-functional product configuration can be protected by both trade dress and design patent production.

Marketing and Advertising

Any pre-existing third-party content incorporated into a product, or its associated advertising and marketing material, must be cleared with the copyright owner, and material commissioned from ad agencies and graphic designers must be subject to written assignments or work-for-hire agreements. Even “invisible” materials, such as third-party software authoring tools, must be used in accordance with the relevant agreements under which they were acquired. The only difficult part of the process is determining exactly what copyrightable materials are incorporated into each work and whom to approach for clearance. To assist in this effort, all contributors to the final product should identify which “borrowed” elements, if any, they incorporated into their portion of the work. If such an inventory is kept throughout the development of a product, the chances of an inadvertent omission should be greatly reduced.

Distribution

Internet Issues

Making copyrighted works available on the Internet, whether through streaming media or downloads, raises a significant risk of “leakage” – that is, unauthorized retransmission or other reuse by the initial recipient. In addition, any technological access control imposed by the copyright owner (e.g. password protection) data providers should impose mandatory terms and conditions on access, often in the form of a “shrink-wrap” or “click-wrap” license agreement, restricting the uses that the user may make of the information. These agreements are generally binding and enforceable, provided that they are truly voluntary. Thus, an information provider may generally rely on written terms of use as a way of protecting its data, but only if the terms are clearly visible to the user before access is permitted, and if the user affirmatively agrees to be bound.

Distribution Agreements – Trademark Issues

Distributorship agreements provide the distributor with the right to sell trademark products of a company in a defined territory, often comprised of certain regions or worldwide. The agreement should expressly preclude the distributor and, if applicable, the manufacturer, retailer, and others from securing trademark registration rights in its own name in any territory, as this will make future assignment and enforcement of the mark difficult. In addition, once the arrangement has ceased, the other party may not be willing to assign its rights in the mark and registration to the company and the parties may become embroiled in an infringement action or the company may find itself unable to sell its products in those countries under the mark in question without itself being deemed an infringer. Even if the distributor is merely selling goods manufactured by the company, quality control also should be provided for in a contract.