Breach of License of Intellectual Property Infringement

Two companies enter into an intellectual property licensing agreement. Later, a dispute erupts over whether the licensee has used the IP outside the scope of the license agreement such as marketing a brand on a new product line or selling patented goods in another territory. Does this extra-license use constitute breach of contract? Infringement of the IP rights or both?

The distinction matters because remedies for infringement differ from contract damages. For example, a copyright registered pre-infringement entitles the owner to elect statutory damages over actual damages. A successful plaintiff in a trade secret or trademark case can potentially recover exemplary damages in addition to actual damages recoverable in a breach of contract action. In patent and trademark actions, treble damages are available. Recovery of attorney's fees, while provided under the Patent Act and Lanham Act, are generally easier to recover in connection with a successful breach of contract action. Therefore, these differences make careful consideration of claim pleading necessary to maximize recovery.

While it may not always be clear at the onset whether an extra-license use constitutes a breach of contract or an infringement of IP rights, the following provides some guidelines between where a license ends and infringement begins:

· Type of license. The threshold issue is determining whether the license is an exclusive license or a non-exclusive license. Courts have held that where the licensee has been granted an exclusive license, unlicensed use of the IP is merely a breach of contract. The underlying rationale stems from the understanding that an exclusive license transfers ownership of the IP rights. The licensee is incapable of infringing an interest in IP that he owns. Thus, any use of the IP beyond the scope of the license agreement would result in breach of contract, rather than infringement. Conversely, if the licensee has only been granted a non-exclusive license, any use of the IP beyond the scope of the license agreement could result in the licensee being liable for infringement.

· Provision Breached. Another key issue in distinguishing between a breach of contract or infringement is determining whether the provision of the license agreement breached is a contract covenant or a condition precedent. If the provision were a contract covenant, then the breach would result only in a breach of contract. However, if the provision were a condition precedent, then the condition was not satisfied and the contract effectively does not exist. Therefore, any use of the IP would result in infringement.

· Limitations. Similarly, if the license agreement is limited in scope and the licensee acts outside the scope, then the licensor can bring an action for infringement. To prevail, the licensor must establish that the license terms are limitations on the scope of the license, rather than independent contractual covenants, and that the licensee's actions exceed the scope of the license.

In certain instances, courts have concluded that a license agreement has created both contractual covenants and conditions precedent or both contractual covenants and limitations on the scope of the license. In such cases the courts have held that both breach of contract and infringement causes of actions are available.

Intellectual Property Lawyers and How to Tackle IP Litigation   Basics of Trademarks for Small Business   Managing the Unmanageable for Law Office/Firms Management   Intellectual Property Monetization Is More of a Moral Issue   

Intellectual Property Expert

The terms patent and intellectual property (IP) are often used interchangeably. In some respects, these terms are indeed interchangeable. All patents are the intellectual property of the inventor or inventors. Yet there are distinct differences in each category.

Patents can be bought and sold, as can IP. Patents can be licensed, as can other forms of IP. Both IP and inventions may belong to the creator's employer if it was created as part of their employment. Patents and intellectual property rights in one nation may automatically carry that protection to other nations, based on treaties they have signed. Theft of intellectual property, including patented inventions, can be fought by suing those who replicated the content or creation without permission.

However, IP includes written works, musical scores, artwork, software code and other creations of thought that are not patentable. IP belongs to the creator from the moment it is created; no additional forms or fees are required to own the rights to what you have written or created. Patents only apply to physical inventions, repeatable business models, manufacturing processes, seeds and genetics. All discoveries are the IP of the discoverer unless they publish the information and state that it is now part of the public domain. Patents remain the property of the owner after the patent is granted and papers about it are written; however, writing papers about the invention before the patent is granted can endanger the patent.

Property Protection Trademarks are unique symbols that identify a company or person. These symbols can be registered within the company or person's nation. Copyrights are simply a statement of ownership of content, such as a song, slogan, short story or blog post. In the United States, it is no longer necessary to put a copyright mark on material to enforce the copyright at a later point, but this does help distinguish public domain work from that which is privately owned.

Patented products can be copyrighted or trademarked. Unpatented inventions can also be copyrighted and trademarked, but this makes it more difficult to pursue those who copy the design as their own. Websites cannot be patented, but they can be trademarked or copyrighted as intellectual property. Trademarks and copyrights are subject to less restricted approval processes, but do afford legal protection of IP. Software models can be patented if they are sufficiently novel and unique, but the code used to create it is always the intellectual property of the software engineer or software company that developed it.

Intellectual Property Lawyers and How to Tackle IP Litigation   Basics of Trademarks for Small Business   Managing the Unmanageable for Law Office/Firms Management   Intellectual Property Monetization Is More of a Moral Issue   

Intellectual Property Management Basics: Patents, Copyrights and Trademarks

Intellectual property (IP) management is important for any company who owns different types of IP. You'll need to properly manage your IP assets, to ensure that you make the most of them. Of course, to be able to do any sort of intellectual property management, you'll have to identify your IP in the first place. There are different types of intellectual property and patents, copyrights and trademarks are the more common forms of IP. Let's take a look at these types of IP and what exactly they are and what they cover.

Patent

Patents are granted to inventions, whether it is a device, process, or substance, which allows the owner to use that invention for their own purpose. For a patent to be granted, certain conditions must be met - it must be something new, it must be useful, it must a be something created from human activity, it must be innovative and it should not have been previously used before. Of course, there are things that cannot be patented - natural or human process cannot be patented, for example, and things which are just the extension of another invention (rather than something new) will not be given patents.

Copyrights

Creative, artistic or intellectual works are protected by copyrights. It protects these ideas from being used or reproduced without the owner's permission. Provided the idea is original, it is automatically protected by copyright law (and recognized in many countries around the world.) On average, the copyright of any given work is protected up to 70 years after the death of the creator. In general, these are the types of works protected by copyright: broadcasts, sound recordings, literary works, artistic works, dramatic works, musical works and cinematographic works. As the name implies, a copyright prevents other people from copying a given work without the permission of the owner.

Of course, there also exceptions to this copyright. In many instances, home or personal use is exempted. For example, if you bought a DVD and you want to copy it to your personal viewing device, you can't be sued for copyright infringement by the producers of the film. In many cases, "fair use" (reproducing only 10% or one chapter of a work) is considered exempted from copyrights.

Trademarks

As the name implies, a trademark is a symbol or mark used by a company to distinguish itself from other businesses. Such marks can often be the most valuable IP asset of any company, and such many companies use intellectual property management resources are often used to protect the trademark. Think, for example, of Apple' distinct white apple logo and how powerful it is. A company needs to apply and maintain their trademarks, and prevent other people from using it, or a similar trademark for their business activities.

Intellectual Property Lawyers and How to Tackle IP Litigation   Basics of Trademarks for Small Business   Managing the Unmanageable for Law Office/Firms Management   Intellectual Property Monetization Is More of a Moral Issue