Trademarks and trade secrets - Important for your Business?

From the San Jose Mercury News Dynamic nature of patent law actually has more to do with all kinds of intellectual property for business.

"Paul Goldstein, a Stanford law professor, has written a new book on the subject. Despite its title, 'Intellectual Property' (Portfolio, Penguin Group) is an easy read and a good guide for anyone starting or operating a company involved with patent, trademark and copyright issues. And is there any other kind?"

The article goes onto a Q & A with the author:

Q Your book, "Intellectual Property" is subtitled "The Tough New Realities That Could Make or Break Your Business." What are they?

A The realities center around the volatility of intellectual property law - not just patents, but copyrights, trademarks and trade secrets. An abrupt change in any of these areas of law can make or break your business.

Q By "abrupt change," you mean. . . ?

A An example: In the early 1970s, Kodak looked at the instant photography business that Polaroid monopolized, thanks to its patents. Kodak had expert counsel, relying on existing patent law which imposed a high standard, telling it that these patents were invalid, under existing standards.

So Kodak invested $600 million, relying on these expert opinions. Well, by the time the product came out, the Court of Appeals for the Federal Circuit had lowered the patent standard, and suddenly patents that looked invalid when Kodak made its investment were now valid. Once you count the damages levied against Kodak, their loss was over a billion dollars, just because the legal standard changed.

Q Can a company protect itself against something like that?

A There are cycles of high and low protection for each form of intellectual property. In the book, I identify the dynamics that indicate where on these cycles we are today with each area of law and what companies can expect to happen.

For example, patents were on a huge upswing starting in 1980s through the end of the century. Now the pendulum is swinging in the opposite direction.

Q Where else are we in this cycle?

A Trademark is in a long-term upswing. It has, over a 100-year period, expanded from a narrow remedy aimed at protecting consumers from confusion to a robust property right. Look at the polo player on the Ralph Lauren shirt, or the name Calvin Klein - these names and brands have taken on a value of their own, almost like a product or a song.

That's been a huge expansion of trademark, and there's no sign it's going to slow down.

Copyright, on the other hand, is in a more modest way encountering the same cutbacks as patents, most notably in the courts.

One thesis of the book is that these changes occur because of public sentiment. In 1998 Congress extended the term of copyright by 20 years. It was a move of no great prospective economic consequence. But it served as a lightning rod in this country for people who said this was a greedy move to monopolize the public domain. As a result, you'll find courts today carving out exceptions to copyright to a degree that we've never seen before.