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Intellectual Property in an Electronic World

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Intellectual Property

In an Electronic World

Business Law & Ethics


This paper provides a general overview of some major issues facing both producers, publishers and consumers of intellectual property. The emphasis, however, is on copyright. Today, of course, that copyright includes the all-pervasive electronic environment of the internet. There are many media in which intellectual property problems arise.

History and Definitions

"Intellectual property" is property resulting from another's creative efforts. Trademarks, logos, patents, books, computer files, movies, music, painting, menus, choreographic works, pantomimes, product packaging, architectural designs and even sculpture may be considered to be intellectual property. In fact, even a student paper such as this may (perhaps too generously) be classified as intellectual property.

The Miller - Jenz text makes the observation that ". .. the value of the world's intellectual property now exceeds the value of physical property . . . ". Clearly, then, intellectual property has become a huge factor in business, social life, entertainment, and international trade. There is much government regulation in the field of intellectual property, as well.

In the past, the most important aspects of law involving intellectual property were copyright and fair use, defamation, trademarks, trade secrets and patents.

Prior to statutory copyright laws, a common law of copyright existed which protected an author's work only until it was published. After being published, if there was not statutory protection, then the author's work entered the public domain and became unprotected! One a work is in the public domain, it cannot be protected. Statutory copyright law in the United States originated with Article I, Section 8 of the U.S. Constitution: "To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries." Congress enacted the first copyright law in 1790. It was decided early that the term "writings" includes many things which might not be considered "writings" in the normal use of the term.

It is possible to sue under common law copyright infringement. In fact, such a suit can be brought in a state court. However, an action for statutory copyright infringement must be brought a federal district court.

Trade secrets, which includes not only research and development, but also such things as lists of customers is covered in some states under common law, while other states have adopted the Uniform Trade Secrets Act. Trade secrets, unlike copyright law, may protect facts (copyright protection extends only to the creative expression of fact). Contractual protection of trade secrets is also common, in the form of non-competition and confidentiality agreements.

Trademarks, or service marks, are words, phrases, slogans, designs or symbols that identify a specific product brand. A trade name, on the other hand, is the formal name that you have permission to use within a particular state. Permission is usually given by the secretary of state to use a particular name, if no one else has incorporated under the name or registered the name. The general rule in trademark law is that the first business to use a trademark owns the trademark. Actual use may actually take precedence over registration of a trademark with the U.S. Patent and Trademark Office!

Of course, these areas have continued to be very important in the electronic age, especially with the advent of the internet. Other areas of intellectual property law which are relatively new include technology transfers, licensing, patents / coprights of software, and the application of international law to the field of intellectual property, including multi-lateral and bilateral agreements.

Modern Copyright Law

The most important area of intellectual property in the electronic environment is copyright. Copyright gives owners the exclusive right to reproduce and reap the economic benefits of their work. Interestingly, there is no requirement that a particular work be new, novel or unique, a fact which sharply distinguishes the law of copyright from the law of patents. Where a work was made by an employee working within the scope of employment, the employer is considered the "author".

Copyrights in the United States are governed by the Copyright Act of 1976. A copyright is defined as a right to intangible property granted by statute to the author or originator of certain types of intellectual property. The current term of a copyright is the life of the author, plus fifty years. Publishing houses own a copyright for seventy-five years from the date of publication or one hundred years from the date of creation, whichever is less. If multiple authors are involved, the copyright expires fifty years after the death of the last author.

A copyright is created automatically. It arises automatically "as soon as some aspect of a protectable work has been fixed in a tangible medium." Registration and notice are not required. There is no longer a requirement to place the copyright mark on material to indicate a copyright. The rationale is that "Chances are that if somebody created it, somebody owns it."

However, there are advantages to giving notice and registering copyrights. Registration is only necessary if legal action may be required, and if the work was created in the U.S.A. Copyrights can be registered with the U.S. Copyright Office, in Washington, D.C.

There are limitations in the extent of copyright protection. The limitation of term was mentioned above. Another important limitation is that an idea cannot be copyrighted. Only the particular manner of expression is protectable. The following are expressly excluded from protection under the Copyright Act of 1976: ideas, procedures, processes, systems, methods of operation, concepts, principles, or discoveries. Facts are not copyrightable. However, compilations of facts are copyrightable. Section 103 of the Copyright Act defines a compilation as "a work formed by the collection and assembling of pre-existing materials of data that are selected, coordinated, or arranged in such a way that the resulting work as a whole constitutes an original work of authorship." Originality is essential. Miller - Jenz cites one case where a



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