Business Law

Business

Quiz 8 :

Intellectual Property Rights

Quiz 8 :

Intellectual Property Rights

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Trade Secrets Briefing.com offers Internet-based analyses of investment opportunities to investors. Richard Green is the company's president. One of Briefing.com's competitors is StreetAccount, LLC (limited liability company), whose owners include Gregory Jones and Cynthia Dietzmann. Jones worked for Briefing.com for six years until he quit in March 2003 and was a member of its board of directors until April 2003. Dietzmann worked for Briefing.com for seven years until she quit in March 2003. As Briefing.com employees, Jones and Dietzmann had access to confidential business data. For instance, Dietzmann developed a list of contacts through which Briefing.com obtained market information to display online. When Dietzmann quit, she did not return all of the contact information to the company. Briefing.com and Green filed a suit in a federal district court against Jones, Dietzmann, and StreetAccount, alleging that they had appropriated these data and other "trade secrets" to form a competing business. What are trade secrets? Why are they protected? Under what circumstances is a party liable at common law for their appropriation? How should these principles apply in this case? [ Briefing.com v. Jones, 2006 WY 16, 126 P.3d 928 (2006)]
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Trade secrets refer to private information that is of commercial value to a company based on its secrecy. It's essentially a competitive edge and be anything from customer lists to manufacturing techniques. This is to promote a free and open market and to reward innovation. However, to prove a case for trade secrets, these secrets must be disclosed or misappropriated for commercial profit,
In this case, the defendant does not seem to have violated any confidentiality because she did not disseminate the information.

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Two computer science majors, Trent and Xavier, have an idea for a new video game, which they propose to call Hallowed. They form a business and begin developing their idea. Several months later, Trent and Xavier run into a problem with their design and consult with a friend, Brad, who is an expert in designing computer source codes. After the software is completed but before Hallowed is marketed, a video game called Halo 2 is released for both the Xbox and the Playstation 3 systems. Halo 2 uses source codes similar to those of Hallowed and imitates Hallowed's overall look and feel, although not all the features are alike. Using the information presented in the chapter, answer the following questions. Based only on the facts described above, could Trent and Xavier sue the makers of Halo 2 for copyright infringement? Why or why not? DEBATE THIS: Congress has amended copyright law several times. Copyright holders now have protection for many decades. Was Congress right in extending these copyright time periods? Why or why not?
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Following are the expressions of an original work which are protected by copyright law:
a. Literary works (including newspaper and magazine articles, computer and training manuals, catalogues, brochures and print advertisements)
b. Pictorial, graphic and sculptural works.
c. Musical works.
d. Dramatic works and accompanying music.
e. Motion pictures and other audiovisual works (including multimedia works)
f. Pantomimes and choreographic works (including every form of dance)
g. Sound recordings.
h. Architectural works.
H comes under the category of pictorial work and motion pictures or other audiovisual works that includes multimedia works and therefore, T and X can sue for copyright infringement.

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Fair Use Professor Wise is teaching a summer seminar in business torts at State University. Several times during the course, he makes copies of relevant sections from business law texts and distributes them to his students. Wise does not realize that the daughter of one of the textbook authors is a member of his seminar. She tells her father about Wise's copying activities, which have taken place without her father's or his publisher's permission. Her father sues Wise for copyright infringement. Wise claims protection under the fair use doctrine. Who will prevail? Explain.
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Facts:
The person R is a food buyer for the company OCF. She decides to conduct her own business named RK. She makes an offer to the organic supplier to buy their harvest and offers the customer to sell the product at less price than the ex-employer.
Intellectual property rights:
It refers to the right of the company to have a monopoly to use its own ideas, plans, or any other intangible assets. It includes rights such as copyright, trademark, patents and trade secrets. These rights encourage innovations as it reduces the fear that the competitors may steal the idea.
Trade secret:
It refers to the information of commercial value such as plans, customer lists, and research and development. It may also include marketing methods, pricing information, production techniques which make an individual company unique.
Outcome:
The person R has not violated any intellectual property rights because she has not revealed any business information such as the pricing method or marketing method which will negatively affect the organic business or reduces the economic advantage of the business over the competitors. She has just offered the customer to sell her products at less price. Therefore, she has not violated any rights.

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Copyright Redwin Wilchcombe is a musician and music producer. In 2002, Wilchcombe met Jonathan Smith, known as Lil Jon, a member of Lit Jon The East Side Boyz (LJESB). Lil Jon and LJESB are under contract to give TeeVee Toons, Inc. (TVT), all rights to LJESB's recordings and Lil Jon's songs. Wilchcombe composed, performed, and recorded a song titled Tha Weedman at Lil Jon's request, based on his idea, and with his suggestions for LJESB's album Kings of Crunk. They did not discuss payment and Wilchcombe was not paid, but he was given credit on the album as a producer. By 2005, the album had sold 2 million copies. Wilchcombe filed a suit in a federal district court against TVT and the others, alleging copyright infringement. The defendants asserted that they had a license to use the song. Wilchcombe argued that he had never granted a license to anyone. Do these facts indicate that the defendants had a license to use Wilchcombe's song? If so, what does that mean for Wilchcombe's cause? Explain. [ Wilchcombe v. TeeVee Toons, Inc., 555 F.3d 949 (11th Cir. 2009)]
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Trade Secrets Peggy Hamilton was a major shareholder in Carbon Processing and Reclamation (CPR), LLC. After a dispute, she sold her interest in the company and signed a confidentiality agreement not to divulge company business to anyone. A year later, when William Jones, the owner of CPR, left on a trip, he let an employee, Jesse Edwards, drive his company car. There were boxes containing some detailed company records in the car. Edwards and his wife, Channon, were in the middle of a divorce, and she suspected him of hiding financial information from her. When Channon saw the boxes in the car her husband was driving, she got a car key from Hamilton, who still had one from when she was an owner. Channon used the key to get into the boxes of company information. Jones then sued Hamilton for breach of the confidentiality agreement, contending that allowing Channon to have access to the files was assisting in the theft of trade secrets. The trial court dismissed the claim, but Jones appealed. Could Hamilton's actions be the basis for a claim of trade secret violation? What factors should be taken into consideration? [ Jones v. Hamilton , ___ So.3d___ (Ala.Civ.App. 2010)]
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Two computer science majors, Trent and Xavier, have an idea for a new video game, which they propose to call Hallowed. They form a business and begin developing their idea. Several months later, Trent and Xavier run into a problem with their design and consult with a friend, Brad, who is an expert in designing computer source codes. After the software is completed but before Hallowed is marketed, a video game called Halo 2 is released for both the Xbox and the Playstation 3 systems. Halo 2 uses source codes similar to those of Hallowed and imitates Hallowed's overall look and feel, although not all the features are alike. Using the information presented in the chapter, answer the following questions. If Trent and Xavier had obtained a business process patent on Hallowed, would the release of Halo 2 have infringed on their patent? Why or why not? DEBATE THIS: Congress has amended copyright law several times. Copyright holders now have protection for many decades. Was Congress right in extending these copyright time periods? Why or why not?
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Two computer science majors, Trent and Xavier, have an idea for a new video game, which they propose to call Hallowed. They form a business and begin developing their idea. Several months later, Trent and Xavier run into a problem with their design and consult with a friend, Brad, who is an expert in designing computer source codes. After the software is completed but before Hallowed is marketed, a video game called Halo 2 is released for both the Xbox and the Playstation 3 systems. Halo 2 uses source codes similar to those of Hallowed and imitates Hallowed's overall look and feel, although not all the features are alike. Using the information presented in the chapter, answer the following questions. Would the name Hallowed receive protection as a trademark or as trade dress? Explain. DEBATE THIS: Congress has amended copyright law several times. Copyright holders now have protection for many decades. Was Congress right in extending these copyright time periods? Why or why not?
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Copyright Infringement United Fabrics International, Inc., purchased a fabric design from an Italian design house, Contromoda, and registered a copyright to the design with the U.S. Copyright Office. When Macy's, Inc., began selling garments with a similar design, United fi led a copyright infringement lawsuit against Macy's and others. In its defense, Macy's claimed that United did not own a valid copyright to the design. Ownership of a copyright is a requirement to establish an infringement claim. The district court held that the evidence was insufficient to establish United's ownership of the design and, for that reason, dismissed the action. United appealed, arguing that its copyright in the design should be presumptively valid because the copyright had been registered with the U.S. Copyright Office. How should the federal appellate court rule? Should the owner of a registered copyright have to prove that the copyright is valid to establish infringement? Or, should the party contesting the validity of a copyright have to show that it is invalid? Explain your answer. [United Fabrics International, Inc. v. C J Wear, Inc., 630 F.3d 1255 (9th Cir. 2011)]
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To watch this chapter's video, The Jerk, go to www.cengagebrain.com and register your access code that came with your new book or log in to your existing Cengage account. Select the link for the "Business Law Digital Video Library Online Access" or "Business Law CourseMate." Click on "Complete Video List," view Video 66, and then answer the following questions: (a) In the video, Navin (Steve Martin) creates a special handle for Mr. Fox's (Bill Macy's) glasses. Can Navin obtain a patent or a copyright protecting his invention? Explain your answer. (b) Suppose that after Navin legally protects his idea, Fox steals it and decides to develop it for himself, without Navin's permission. Has Fox committed infringement? If so, what kind-trademark, patent, or copyright? (c) Suppose that after Navin legally protects his idea, he realizes he doesn't have the funds to mass-produce the glasses' special handle. Navin therefore agrees to allow Fox to manufacture the product. Has Navin granted Fox a license? Explain. (d) Assume that Navin is able to manufacture his invention. What might Navin do to ensure that his product is identifiable and can be distinguished from other products on the market?
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Two computer science majors, Trent and Xavier, have an idea for a new video game, which they propose to call Hallowed. They form a business and begin developing their idea. Several months later, Trent and Xavier run into a problem with their design and consult with a friend, Brad, who is an expert in designing computer source codes. After the software is completed but before Hallowed is marketed, a video game called Halo 2 is released for both the Xbox and the Playstation 3 systems. Halo 2 uses source codes similar to those of Hallowed and imitates Hallowed's overall look and feel, although not all the features are alike. Using the information presented in the chapter, answer the following questions. Suppose that Trent and Xavier discover that Brad took the idea of Hallowed and sold it to the company that produced Halo 2. Which type of intellectual property issue does this raise? DEBATE THIS: Congress has amended copyright law several times. Copyright holders now have protection for many decades. Was Congress right in extending these copyright time periods? Why or why not?
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CASE PROBLEM WITH SAMPLE ANSWER: Trademarks. In 1969, Jack Masquelier, a professor of phannacology, discovered a chemical antioxidant made from the bark of a French pine tree. The substance supposedly assists in nutritional distribution and blood circulation. Horphag Research, Ltd., began to sell the product under the name Pycnogenol, which Horphag registered as a trademark in 1993. Pycnogenol became one of the fifteen best-selling herbal supplements in the United States. In 1999, through the Web site www.healthierlife.com , Larry Garcia began to sell Masquelier's Original OPCs, a supplement derived from grape pits. Claiming that this product was the "true Pycnogenol," Garcia used the mark as a meta tag and a generic term, attributing the results of research on Horphag's product to Masquelier's and altering quotations from scientific literature to substitute the name of Masquelier's product for Horphag's. Customers who purchased Garcia's product contacted Horphag about it, only to learn that they had not bought Horphag's product. Others called Horphag to ask whether Garcia "was selling … real Pycnogenol." Horphag filed a suit in a federal district court against Garcia, alleging, among other things, that he was diluting Horphag's mark. What is trademark dilution? Did it occur here? Explain. [ Horphag Research, Ltd. v. Garcia, 475 F.3d 1029 (9th Cir. 2007)]
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Trademark Infringement Sync Computers, Inc., makes computer-related products under the brand name "Sync," which the company registers as a trademark. Without Sync's permission, E-Product Corp. embeds the Sync mark in E-Product's Web site, in black type on a blue background. This tag causes the E-Product site to be returned at the top of the list of results on a search engine query for "Sync." Does E-Product's use of the Sync mark as a meta tag without Sync's permission constitute trademark infringement? Explain.
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A QUESTION OF ETHICS: Copyright Infringement. Custom Copies, Inc., in Gainesville, Florida, is a copy shop that, on request, reproduces and distributes, for profit, material published and owned by others. One of the copy shop's primary activities is the preparation and sale of coursepacks, which contain compilations of readings for college courses. For a particular coursepack, a teacher selects the readings and delivers a syllabus to the copy shop, which obtains the materials from a library, copies them, and then binds and sells the copies. Blackwell Publishing, Inc., in Malden, Massachusetts, publishes books and journals in medicine and other fields and owns the copyrights to these publications. Blackwell and others filed a suit in a federal district court against Custom Copies, alleging copyright infringement for its "routine and systematic reproduction of materials from plaintiffs' publications, without seeking permission," to compile coursepacks for classes at the University of Florida. The plaintiffs asked the court to issue an injunction and award them damages, as well the profit from the infringement. The defendant filed a motion to dismiss the complaint. [ Blackwell Publishing, Inc. v. Custom Copies, Inc., __ F.Supp.2d __ (N.D.Fla. 2007)] (a) Custom Copies argued, in part, that creating and selling did not "distribute" the coursepacks. Does a copy shop violate copyright law if it only copies materials for coursepacks? Does the copying fall under the "fair use" exception? Should the court grant the defendant's motion? Why or why not? (b) What is the potential impact if copies of a book or journal are created and sold without the permission of, and the payment of royalties or a fee to, the copyright owner? Explain.
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In which of the following situations would a court likely hold Ursula liable for copyright infringement? (a) Ursula goes to the library and photocopies ten pages from a scholarly journal relating to a topic on which she is writing a term paper. (b) Ursula makes blouses, dresses, and other clothes and sells them in her small shop. She advertises some of the outfits as Guest items, hoping that customers might mistakenly assume that they were made by Guess, the well-known clothing manufacturer. (c) Ursula teaches Latin American history at a small university. She has a digital video recorder and frequently records television programs relating to Latin America and puts them on DVDs. She then takes the DVDs to her classroom so that her students can watch them.
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