ARTICLES  &  NEWSLETTERS

THE IMPORTANCE OF
INTELLECTUAL PROPERTY MARKING

 

 

One of the primary benefits of intellectual property ownership is the ability to be compensated for the use of that property by others. For authorized uses, this compensation typically comes in the form of royalties paid pursuant to an agreement. For unauthorized uses, compensation comes in the form of damages awarded by the court from an infringer to the intellectual property owner. The potential award of damages for which an intellectual property owner is eligible could be severely limited, however, if the owner failed to adequately provide notice through proper marking prior to bringing a claim for infringement.

 

INTELLECTUAL PROPERTY “MARKING” refers to the placement of certain indicia of intellectual property protection, either on goods themselves or in marketing materials promoting goods or services. Marking serves the purpose of providing notice to the public that such protection is in place.

 

INFRINGEMENT is a strict-liability offense. Innocent intent does not determine liability, only potentially the extent of available remedies. An intellectual property marking can provide a deterrent against potential acts of infringement by outside parties. It could also encourage a party seeking to capitalize on the property to research and contact the owner for a potential business relationship. These are two very important functions because, otherwise, an outside party may not be aware of intellectual property protection that is in place and could become an unwitting infringer.

 

Moreover, an infringer’s potential monetary liability may be limited due to the owner’s failure to mark. An infringement plaintiff with less financial reward to gain may be reluctant to enforce its rights. A defendant with less financial exposure, meanwhile, may be emboldened to fight the case rather than settle. These realities could both depend on whether intellectual property was properly marked. The intellectual property laws all include provisions limiting monetary remedies available to those who fail to mark.

 

PATENTS: If the property is a patent, the marking could come in several forms. Traditionally, patent marking consisted of affixing directly onto a product, its packaging, or its labels the word “patent” or the abbreviation “pat.” followed by the number of an applicable patent, or where a patent application is currently pending, a marking indicating this status. Since the enactment of the America Invents Act in 2011, the law also allows for “virtual marking” – i.e., marking a product or materials with the word “patent” or “pat.” together with the address of a publicly-accessible internet posting that associates the product or service with the number of the applicable patent. This form of marking is much easier for a patent owner because it can be done in real time and is easily updatable, requiring only the simple revision of a web page. Patent markings could include:

 

U.S. Patent 7,654,321

U.S. Pat. 7,654,321

U.S. Patent Pending

www.acme.com/patents

 

Section 287 of the Patent Act (35 U.S.C. § 287) states that no damages shall be recovered by the patentee for infringement without proof that the infringer was notified of the infringement. Thus, unless a cease-and-desist letter was previously issued, a defendant would not be presumed to have notice of an issued patent prior to the filing of an infringement complaint in court. Any potential damages that could have accrued prior to filing the complaint would be lost.

 

TRADEMARKS: For trademarks, a “TM” marking indicates a claim of common-law trademark rights accrued from use of the mark in commerce. A “®” marking indicates that the trademark is covered by an issued registration. Trademark markings could include:

 

Acme®

Acme™

 

Like the Patent Act, Section 29 of the Lanham Act (15 U.S.C. § 1111) states that no damages for infringement of a registered trademark shall be recovered unless the defendant had actual notice of the registration. Thus, unless a cease-and-desist letter was previously issued, any potential damages that could have accrued prior to filing the complaint would be lost.

 

COPYRIGHTS:  The Copyright Act does not require copyright marking per se in terms of determining damages, though it does bear on other considerations depending on the year the copyrighted work was published. “Marking” in terms of copyright refers to a copyright notice. For works published on or after March 1, 1989, the use of a such notice is optional. For works published from January 1, 1978 to February 28, 1989, the lack of a notice could have resulted in a loss of copyright protection if corrective steps were not taken within a certain amount of time. For works published prior to January 1, 1978, failure to include a proper notice could result in the permanent loss of all copyright protection in the United States. A copyright notice includes a reference to copyright, either in the form of the circled-C symbol, the word “Copyright”, or the abbreviation “Copr.” It also includes the year of first publication of the copyrighted work and the name of the copyright owner. Thus, a proper copyright notice could include:

 

© 2018 Acme Corp.

Copyright 2018 Acme Corp.

Copr. 2018 Acme Corp.

 

In lieu of a marking requirement, the Copyright Act limits potential damages – andenforcement of any kind - through the establishment of a framework that encourages registration promptly after publication of a work. Section 411 of the Copyright Act (17 U.S.C. § 411) prevents an infringement lawsuit from being brought unless preregistration or registration of the copyright has been made. Meanwhile, Section 412 of the Act (17 U.S.C. § 412) provides that a copyright owner shall not be eligible for an award of statutory damages ($750 to $30,000 per infringed work) or reimbursement of attorney fees unless registration was effective before the infringement commenced, unless the registration was made within three months after first publication of the copyrighted work. Otherwise, remedies would be limited to actual damages proven in court. Thus, the general rule is that you cannot enforce a copyright in court without first obtaining a copyright registration, and you would be limited as to your potential remedies unless the registration became effective before the infringement commenced or within three months of the copyrighted work being first published. The infringement defendant, however, would still be eligible to recover its attorney fees in the event it prevails. A copyright owner that does not obtain a timely registration is therefore at an immediate disadvantage.

 

Though intellectual property markings may not always be required, they remain important considerations with respect to matters of enforcement. Markings are relatively easy to implement and can carry significant value. The prudent course of action for intellectual property owners is to signify protection wherever feasible to encourage business opportunities, deter infringers, and facilitate the greatest potential recovery where infringement takes place.

 

 For any questions about intellectual property marking, feel free to contact us for a consultation and review.

 

By: Brian M. Taillon

Intellectual Property Attorney

 

 

 

©  2018 McHale & Slavin, P.A.  -  Patent, Trademark and Copyright Law.  All Rights Reserved.