Facebook is taking certain steps to prevent infringement of intellectual property through “name-squatting.” In connection with this, Facebook is allowing Federally registered trademark holders to prevent the registration of usernames that would infringe their intellectual property rights.

There is a link to the form on Facebook’s Web site if you want to complete the form yourself. You will need the trademark registration number and the exact wording of the trademark as registered.

For more information, or to protect your trademark, please contact Pamela Baxter at pamela.baxter@keanmiller.com (225.389.3761) or Russel Primeaux at russel.primeaux@keanmiller.com (225.382.3454).

As we continue our shift to a more knowledge-based economy, frequently the greatest assets of a company reside in the creativity of its employees. This is especially true for service companies in which the services can be repeated for multiple customers (example: software). Whether or not a company owns something that has been created by one of its employees will depend to a great extent on the category of intellectual property into which the creation is classified. Generally, the creations or discoveries of employees will fall into the intellectual property categories of copyright, patent, or trade secret.

The legal standard used in determining whether a company owns a patentable invention is narrower than the “scope of employment” standard used in copyright law. For patentable inventions, the courts look to whether the employee had a “duty to invent.” We return to the above example of Mr. Jones, the dispatcher. Suppose the creation by the dispatcher was capable of patent protection. Because Mr. Jones was a dispatcher, who did not have a specific duty to invent, it is likely the company would not own any patent that might be issued to cover the invention.

For trade secrets, the law is less clear than the law for copyright and patent. Generally, trade secret law states that a trade secret will exist if the underlying information has value by not being generally known and is the subject of reasonable measures to keep it secret. Trade secrets are normally the property of the company, and not the individual employees. However, as a practical matter trade secrets are harder to control than patents or copyrights. If an employee maintains a list of customer contacts on her personal cell phone, and the employer does not have a specific policy stating that customer contacts are the property of the employer; it will be difficult for the employer to assert that the contact information is a company trade secret when that employee leaves the company.

Companies should use their information technology management practices to bolster the company’s trade secret practices. For example, if the sales person above had been provided a company Blackberry, and if the system ensured that all contact information was stored on company servers; the company would have a stronger basis for arguing that the customer contact information is a trade secret. The company would be in an even stronger position if it had a written policy regarding the company’s trade secret practices. Additionally, trade secret obligations should be included in employment agreements as well.

Employment agreements can also be used to clarify the company’s ownership of copyrights and patents. The company can make clear that the “scope of employment” for copyrights is considered very broad. Also, the company could impose a duty to invent on all employees. Additionally, the employee agreement can clearly state, under a simple contractual basis, that all inventions or works of authorship created by employees are owned by the company.

A company can properly protect and claim ownership over the creations of its employees. Doing so requires a knowledge of the different areas of the law that apply and appropriate company practices. Those practices should take advantage of the applicable law and should fill in the gaps where the law does not adequately address the situation.
 

“Someone is using my photos and website design on the internet without permission. What can I do?” These questions arise more and more with the increased use of the internet in business. The technical answer is that you have a potential claim for copyright infringement. Filing a federal lawsuit under the Copyright Act, however, is not a realistic option for many businesses, particularly when monetary damages may not be at issue. The goods news is that with the enactment of the Digital Millennium Copyright Act (“DMCA”), 17 U.S.C 512, victims of internet copyright infringement now have a more practical option for achieving the desired result – removing the infringing material from the internet – without filing a lawsuit. 

Once the ISP receives a written notice containing 1) identification of the work claimed to have been infringed, 2) identification and location of the infringing material, 3) contact information for the copyright owner, and 4) statements that that claimant has a good faith belief that the use is unauthorized and the notice is accurate and submitted by a person with authority to pursue the copyright owners rights, the DMCA requires that the ISP act expeditiously to remove or disable able access to the infringing material in order to maintain its limited liability. See 17 U.S.C. 512(c).

However, as with any claim, a DMCA claim should be thoroughly investigated before a notice of infringement is issued. “Any person who knowingly materially represents [that material or activity is infringing] shall be liable for any damages, including costs and attorneys’ fees, incurred by the alleged infringer . . . or by a service provider, who is injured by such misrepresentation. . . .” 17 U.S.C. 512(f). 

The DMCA provides a more practical option for businesses to stop internet copyright infringement without having to incur the expense of filing suit. Moreover, results can oftentimes be achieved in a matter of weeks, as opposed to months or years. 

A jury in California issued a $6 million verdict against SLB Toys USA, Inc. (also known as ToyQuest) in favor of Wham-O, Inc., the manufacturer of the famous backyard yard toy, the Slip ‘N Slide. Wham-O owns two registrations for design marks for water slides which include the color yellow as part of the registration. Wham-O claimed that its famous yellow water slide has become an instantly recognizable iconic symbol of summer fun, and is famous among both children and adults.

On April 23, 2006, Twentieth Century Fox Film Corporation aired an episode of “Family Guy” entitled “Peterotica.” In this episode, Peter Griffin, who was an Archie Bunker-like character, enters a porn shop with his friends and comments that the porn shop is cleaner than he expected. One of Peter’s friends explains that Carol Burnett works part-time as a janitor. At this point, an animated character resembling the “Charwoman” from the Carol Burnett Show appears mopping the floor near several blow-up dolls and a rack of “XXX” movies. At this point, a slightly modified version of Carol Burnett’s theme song is playing in the background. One of Peter’s friends remarks, “You know, when she tugged her ear at the end of the show, she was really saying good night to her mom.” Another friend responded, “I wonder what she tugged to say good night to her dad?”

In responding to the action, defendants contended that even if the plaintiff possesses a valid copyright, the claim is barred by the doctrine of fair use. The court analyzed the fair use factors, including (a) the purpose and character of the work, (b) the nature of the copyrighted work, (c) the amount and substantiality of the amount used, and (d) the effect on the potential market. The fair use doctrine calls for a case-by-case analysis. See Campbell v. Acuff Rose Music, Inc., 510 U.S. 569 (1994). 

In addressing the first factor, the court considered to what extent the new work is transformative. Parody is a form of transitive use and is defined as a “literary artistic work that imitates the characteristic style of an author or a work for comic effort or ridicule, or is a composition in prose or verse in which the characteristic turns of thought and phrase or classes of authors are imitated in such a way to make them appear ridiculous.” After considering the arguments, the court concluded that the 18-second clip of the animated figure resembling the “Char woman,” mopping the floor next to the blow-up dolls, a rack of “XXX” movies, and video booths in a porn shop is clearly designed to imitate the style of an author or work for comic effort or ridicule. Family Guy put a cartoon version of Carol Burnett/Charwoman in an awkward, ridiculous, crude and absurd situation in order to lampoon and parody her as a public figure. In further analyzing fair use, the Court stated the Family Guy took just enough of the imaginary and accompanying theme music to make the crude depiction of the “Charwoman” character recognizable to the viewers. It noted that the market demand for the non-parodic use of the Charwoman would not be fulfilled by use that has the character in front of a blow up doll and XXX movies. Finally, the Court concluded that there was likelihood of confusion by the defendant’s use of the Char woman character and, thus, there was no basis for confusion or dilution.

The Court noted that Carol Burnett is an icon in American culture, as is her character the Charwoman. She is well respected and loved by a large sub-segment of American public based upon her persona and her outstandingly successful entertainment career. The Court stated, “Although debasing the Charwoman and making Ms. Burnett’s parents participants in a crude joke is disheartening, it does not mean she has a cause of action.” The Court dismissed the action concluding the law, as it must in an open society, provides broad protection for the defendant’s parodic segment.

The purpose of due diligence in the acquisition of licensing of intellectual property assets (namely patents and copyrights) is to give a buyer an opportunity to investigate and evaluate the asset concerned in some detail. More particularly, due diligence involving patens and copyrights can present ownership issues if the author/inventor is or was married and resides in a community property state. Whatever level of diligence is required for the particular transaction, the buyer should consider inquiring as to the current and past marital status of the inventor/author of the intellectual property if the inventor/author is either the seller; a direct owner of the seller; or in some cases, even a past owner of the intellectual property.

In the case of patents, federal case law states that the ownership of a patent vests initially with the inventor or inventors. On the other hand, in community property states like Louisiana, Texas, and California, a patent that is developed during the marriage is presumed to be co-owned by both spouses even though the other spouse is not a named inventor. In fact, it is not uncommon for courts to vest partial ownership rights in patents and copyrights to the non-contributing spouse in a binding marital property settlement. Thus far, courts have upheld these types of settlement by holding that federal law does not preempt state law when vesting ownership in the non-contributing spouse.

If the author/inventor of the intellectual property is married at the time of the transaction, it would be advisable to have the author/inventor’s spouse sign as a witness or as party to the assignment or license. Generally, one spouse has the power to transfer community personal property provided the transfer does not defraud the other spouse; however, gaining the non-contributing spouse’s consent would solidify the transaction. If the author/inventor has been divorced, the Buyer will need to determine if the intellectual property was created during the marriage so as to determine the non-contributing spouse’s possible ownership interest.

In the case of a patent, for example, ownership by the non-inventing spouse could be determined by inquiring as to when the invention was conceived; when the patent was filed; and when the patent issued. If either of these events occurred during the marriage, the non-inventing spouse may have a valid claim to an ownership interest in the patent and further diligence will be required by the buyer. At the very lease, any final divorce settlements should be reviewed to determine how the intellectual property was allocated between the two former spouses regardless of what state law controls. Unfortunately, it is common for attorneys to overlook the intellectual property assets when drafting a divorce settlement which may require further research into the controlling state law to determine if the non-contributing spouse has a valid ownership interest. Of course, it is always advisable to insert certain provisions into the contract wherein the seller represents and warrants that the seller is the sole owner of the intellectual property, but these provisions will not be effective against a third-party spouse’s claims of ownership.

In summary, it is always recommended to retain an experienced intellectual property attorney when acquiring or licensing intellectual property assets to deal with the pitfalls that can be involved with these types of transactions.

The Fifth Circuit recently addressed the issue of copyright ownership in its unreported decision in Pritchett v. Pound, civil action 05-41445 (5^th Cir. 2005). In 1981 Ronald Pound was hired by Pritchett, L.P., a business consulting firm founded by E. Price Pritchett. The employment contract provided that he was responsible for “completing regular written assignments and development of new products and procedures.”   It also stated that, “[s]hould the Employee produce any written materials in the course of his work with the Employer, then such shall be done for and on behalf of Employer and all work produced shall be the exclusive property of the Employer.” 

Ronald Pound died in1995.   Thereafter, in 2002, Nancy Pound sued Pritchet alleging co-ownership of the books. That action was subsequently dismissed. Thereafter, Pritchett filed this suit in the Eastern District of Texas seeking a declaratory judgment that it is the sole owner of the copyright in the two books. The Fifth Circuit affirmed the district court’s ruling that Pritchett is the sole owner of the books. The employment agreement specifically provided that written materials are the exclusive property of the employer. The books were therefore “made for hire” because Pritchett and Pound did not expressly agree otherwise by written instrument. See 17 U.S.C. §201(b).

Additionally, the Court held that the registration form is not a written agreement changing the employment relationship between the parties. The fact there was an error by the administrator in filling out the registration application does not change the nature of the employment relationship or ownership of the copyright. Although the certificate of registration can be prima facia evidence of ownership, this can be rebutted and was in this case. The Court also held that the errors in the certificate did not effectuate some type of transfer of the copyright. 17 U.S.C. § 204 states that a transfer of ownership is not valid unless an instrument of conveyance or a note or memorandum of transfer is in writing signed by the owner of the rights conveyed. The registration certificate did not satisfy this requirement as it did not reference a transfer or any intent to convey ownership.

The Fifth Circuit also affirmed the district court’s ruling finding Ms. Pound liable for attorney’s fees. 17 U.S.C. 505 provides that the court may allow the recovery of costs and award attorney’s fees to the prevailing party as part of costs. The district disagreed with Ms. Pound and concluded that this section is not limited to infringement claims since a determination as to ownership is a “civil action under this title”. The Fifth Circuit stated that in view of this often vexatious litigation over a long and tortured procedural history, with charges of fraud being made, the district court had discretion to award reasonable fees to Pritchett. The court did not question the reasonableness of the amount awarded.

The Dilution Statute was enacted as part of the Lanham Act in 1996. The Dilution Statute provides in 15 U.S.C. §1125(c) that the owner of a famous mark shall be entitled to an injunction against another person’s commercial use in commerce of a mark or trade name, if such use causes dilution of the distinctive quality of the mark and to obtain such other relief as provided in this subsection. The courts have been wrestling with the meaning of the terms in the Statute since that time.

On October 6, 2006, President Bush signed the Trademark Dilution Act of 2006 into law to further refine the applicability of the Statute and clarify many of the legal issues. Many of the provisions of the Act are important to note.

First, the Act retitles the cause of action to be for Dilution by Blurring and Dilution by Tarnishment. Presumably, this eliminates the possibility of another basis for claiming dilution. Blurring is defined as an association arising from the similarity between a mark and a famous mark that impairs the distinctiveness of the famous mark. Tarnishment is defined as an association that harms the famous mark’s reputation.

The Act provides factors for considering whether there is a likelihood of blurring including the degree of similarity, degree of inherent or acquired distinctiveness of the famous mark, extent to which the owner of the famous mark is engaging in substantially exclusive use of the mark, degree of recognition of the famous mark, whether the user of the mark intended to create an association with the famous mark, and any actual association between the mark and famous mark.

The term famous mark is now clarified by the Act. In order to have a cause of action, the mark must be famous. The Act clarifies that it is "widely recognized by the general consuming public of the United States." This means the mark must be famous beyond some simple narrow sub-community or niche market, but instead must be in the general consuming public.

Damages are now available as a remedy under the Act if the mark was first used in commerce after the date of enactment of the Act and the defendant intended to trade on the recognition of the famous mark or to harm the reputation of the famous mark. It is unclear how the court will assess damages.

The Act includes a fair use defense by persons other than as a designation of source for the person’s own goods and services in connection with comparative advertising, parody, criticism and comment.

We will see how the courts interpret the new provisions supplied by the Act.

eBay is in litigation with a small company that claims that its patents cover the online auction method used by eBay. Blackberry users were a judge’s pen stroke away from an injunction that would have stopped all Blackberry use in the U.S. In that case, the patent owner, again a small company, claimed that the famous Star Trek type devices infringed the company’s patent. These patents might have been detected during a patent search, if eBay or Blackberry undertook such searches. This article will discuss each type of patent search, the cost, and the purpose.

Patentability Searches

Suppose your company develops a new product that appears to be innovative. You would like to obtain a patent if it is feasible. Before spending the money for a patent application (the initial filing cost could range from $8000 to $20,000), it may be wise to conduct a patentability search. The purpose of this search is to look through the issued patents and published patent applications at the U.S. Patent & Trademark Office (PTO) to find those patents which are relevant to the invention. Once you know of the existing patents, known as the prior art, you can make a better determination of your chances at obtaining a commercially viable patent. A patentability search and report can range from $500 to $2500, depending on (1) the complexity of the technology and (2) whether the results are reported in a formal opinion or are merely discussed in a meeting.

Your company may be concerned that a competitor has a patent on the product you are introducing. A clearance search is conducted to learn whether there are patents that could block you from selling your products. The search is broader than a patentability search. Because the scope of the search can be virtually limitless, it is hard to give a general cost estimate for these searches. The usual practice is to give the searcher a limit at which he or she will stop the search and share the results. However, it is doubtful that a clearance search can be done for less than $2000 and the cost can be much higher. Generally the cost of the product investment will drive the clearance budget. If you are building a half million dollar production line, it would be foolish to pinch pennies on the clearance study. You could finish your expensive production line and be enjoined from using it if a blocking patent existed. On the other hand, if your initial cost to get the first products to market is only $10,000; it would not make any sense to spend $5000 on a clearance search. 

Invalidity Searches

If your company has been sued for infringement, or if your company has received a cease and desist letter that threatens a suit for patent infringement; an invalidity search might be in order. In this search, the goal is to discover patents or other publications that should have been but were not considered during the PTO’s initial examination of the patent. If the invalidity search yields a piece of so-called “killer” or “knock-out” prior art, a couple of options are available. This killer prior art can be used as leverage in licensing negotiations. Alternatively, it can be used as evidence to invalidate the patent through PTO re-examination proceedings or a lawsuit.

These searches, like many facets of intellectual property, are tools that provide you with the proper information for making decisions. Armed with the results of a competent search, your company can exercise sound business judgment on the filing of applications, the introduction of products, or the response to a lawsuit.

Subsequent to registration, the Patent and Trademark Office ("PTO") requires that periodic forms be filed to keep the mark "alive". It is suggested that the mark owner create a calendar system to track the various filing deadlines for the marks. While many law firms will track the deadlines, due to the long time periods that are involved it is always prudent to have the owner of the marks keep track of the dates.

The owner of the trademark should monitor the use of their marks to make sure they are actually used in association with the products or services for which the federal registration was filed. This becomes particularly important if a number of marks are owned in a portfolio of trademarks. Without use of a mark, you may loose all rights in a mark. There is a presumption under federal law that if you do not use a mark for a three-year period, you are deemed to have abandoned the mark. While this presumption is reputtable, it is not something you want to try to rebut at an infringement trial. Best practice is to ensure that each mark in a trademark portfolio is used in commerce each year.

If a trademark is registered for a product, the mark must be used in association with the sale of the product "in commerce". This means the mark must be attached to the product itself (for instance a label sewed to a piece of clothing) or affixed to packaging. If the mark is registered for a service, advertising of the services offered using the mark will be sufficient.

Also, as part of maintenance of your marks, you should make sure you always use a "™" symbol in association with your registered marks (and only your registered marks), and a "TM" next to your unregistered marks, for example: Coke™, or WidgetTM.

Third, you should monitor the use of your marks by competitors and third parties. It is important to take action against all infringers as soon as possible. If you turn a blind-eye to one infringer, or you let someone infringe a mark for too long, the legal doctrine of estoppels and latches may prevent you from enjoining that party from use of the mark, and may destroy your rights in the mark as to the world.

Diligence in the protection and maintenance of your trademarks can save money in the long-run and may help you avoid future costly litigation, as well as protect the name by which your customers have come to know your products and services.

For more information, contact Bill Caughman at 225.389.3724 or bill.caughman@keanmiller.com

The second key definition is misappropriation. This term is defined as the acquisition of a trade secret of another person who knows or has reason to know that it was acquired by improper means or disclosure or use of a trade secret of another without express or implied consent by a person who used improper means to acquire knowledge of the trade secret, or at the time of disclosure knew or had reason to know that his knowledge was derived from a person who had utilized improper means to acquire it. In any action, a plaintiff will have to prove that the party receiving the information wrongfully breached a duty of trust or confidence by disclosing or using the information to the injury of the plaintiff.

Thus, how any supposed trade secret is handled is very important. Evidence regarding use of confidentiality agreements, where the secret information is retained, the process whereby the supposed defendant acquired it, will all be subject to scrutiny by any Court in determining whether a claim is actionable. Businesses should consider whether their efforts to maintain secrecy are reasonable before any supposed misappropriation occurs so as to be covered by this Act.

For more information, contact Sonny Chastain at 225.389.3706 or sonny.chastain@keanmiller.com

Someone once observed that most car accidents occur within 10 blocks of the driver's home. We see a analogous trend in Intellectual Property "crimes" - i.e. infringement of patents, trademarks, or copyrights; or misappropriation of a trade secret. Intellectual Property (IP) disputes between two parties that are strangers to one another are the exception, not the rule.

The licenses can be for trademarks, trade secrets, or patents. In a trademark license, the licensor (the trademark owner who is granting the license) should ensure that the agreement covers good will generated by the licensee. The license agreement should clearly state that good will generated by the licensee in the trademark inures to the benefit of the licensor, not the licensee. Additionally, the agreement should state that any registrations that the licensee seeks to obtain in its name either (1) will be deemed to be obtained for the benefit of the licensor or (2) can be voided by the licensor. Licensees who elect to part ways with the licensor should be careful not to infringe the licensor's trademarks going forward. Former licensees should discard or return to the licensor (check the agreement) all old parts lists, brochures, and marketing materials and start fresh with new materials.

In patent licenses, as well in joint ventures (JVs), the most common dispute is over improvements to technology. The license or venture agreement should spell out exactly what happens in the various scenarios of inventorship. The three possibilities are: (1) the licensor (or JV partner #1) creates the new technology; (2) the licensee (or JV partner #2) creates the new technology; or (3) the invention is truly jointly created by the licensor and licensee (or both JV partners). The license or JV agreement should state how the parties will handle inventions arising under each of these three categories. An important provision is that each party should be under a duty to report all inventions to the other party, even if the reporting party believes it is the sole owner of the invention. Such an obligation ensures that the parties are fully disclosing their activities, and provides an additional legal claim (breach of contract) in addition to the IP infringement claims which might be available.

When dealers or distributors sever their relationship with a manufacturer; it is often because the dealer has decided to make its own products. The dealer must be careful to fully assess the manufacturer's IP rights. The dealer should consult with IP counsel to steer around those IP rights and avoid any infringement claims. From the manufacturer's perspective, the manufacturer should be careful to follow the procedures outlined in the dealer agreement. A court will not look favorably upon a manufacturer who failed to follow the procedures outlined in the dealer agreement; especially if the agreement is a form agreement drafted by the manufacturer.

A final consideration in disputes with former partners is that these disputes are often very emotional situations, and the scenario tends to be driven by personalities. It is important to remember that the dispute is simply another part of one's business and should be treated with sound business judgment. When possible to do so, the person making decisions about the dispute should be a person who was not directly involved in the earlier relationship. When cooler heads prevail, the terms of the "divorce" can be settled in a manner that allows everyone to get back to business.

In November 2003, the United States joined many other countries in signing a treaty called the Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks (the "Madrid Protocol"). The United States Patent and Trademark Office ("PTO") has just recently created forms and procedures to implement the Protocol in the United States. The Madrid Protocol is designed to provide a more efficient method for an owner of a trademark to register its trademark in a number of foreign countries.

While the changes brought about by the Madrid Protocol are largely procedural, the Protocol does eliminate some of the expenses and difficulties typically encountered in attempting to obtain trademark registration under prior methods. Prior to the Madrid Protocol, if a USA based company desired to register its trademarks in different countries, it would be required to obtain local counsel in each of the countries, prepare an application to be filed in each nation's trademark office, and pay fees for such actions in the local currency of each of the various countries. If a trademark was registered, it would then be necessary to track the status of that registration in each country to determine when renewals or other actions needed to be taken, which time periods could vary nation-by-nation.

The Madrid Protocol allows a USA based company to submit, for international registration, the same information it used in a prior trademark application that was presented to the PTO for a registration in the USA. The applicant may also base its international application on a prior trademark registration issued by the PTO. The information must be submitted electronically on a special International Application form. After receipt, the PTO confirms that the information in the International Application is identical to the previously filed US application (or registration), then "certifies" and transmits the International Application to the International Bureau of the World Intellectual Property Organization. The International Bureau, located in Geneva, Switzerland, acts as the centralized agency for the administration of the Madrid Protocol.

Upon receipt, the International Bureau confirms that the International Application is in proper form. At this time, the applicant must also pay a fee to the International Bureau, which amount varies depending on how many countries, and in which countries, the applicant seeks to register their trademark. The fee must be paid in Swiss Francs, but this is the only foreign currency that is required in the application process. The International Bureau then transmits a copy of the International Application to the various countries where registration is sought. Each country then has a maximum of 18 months to approve or deny the trademark. If no response is received by the International Bureau in that time, the International Application is approved for the country that has not responded.

If a country denies an application, then the applicant deals directly with that country in any continued administrative process. If this occurs, it may be necessary for the applicant to obtain local counsel to pursue the application.

However, if the application is granted by a country, a record is made in the office of the International Bureau. The registration so obtained must be honored by the courts of the granting country the same as any other trademark registration issued in that country. Accordingly, even though an applicant files one International Application, the various member nations to the Madrid Protocol may approve or deny registration of the trademark for their particular country. However, once registration is allowed in one or more countries, the renewal of the trademark, and other administrative actions that may arise such as transfers of the mark, are treated as being related to one "international registration." The international registration is effective for 10 years, and may be renewed for successive 10 year periods if so desired.

Overall, the Madrid Protocol allows the trademark applicant to simplify the process of obtaining trademark registrations in foreign countries, and makes it much easier to track the applications through the review process and upon registration. A company's trademarks can be its most valuable assets, and utilization of the procedures provided by the Madrid Protocol can make the processing of protecting trademarks in foreign countries less cumbersome and expensive.

In-house counsel who are employed in Louisiana but are not licensed to practice law here have until July 1, 2005 to file an application for limited licensure to practice under the Louisiana Supreme Court's new In-House Counsel Rule.

Licensure pursuant to the In-House Counsel Rule is discretionary and is not a matter of right. The license issued pursuant to this rule only authorizes the lawyer to practice exclusively for the employer filing the affidavit submitted with the application. The license is automatically terminated if the lawyer's employment with the employer filing the affidavit is terminated. If the lawyer's employment is terminated but the lawyer is immediately thereafter employed by another employer who files an affidavit, the limited license shall be reinstated. A limited license is valid for four years from the date of issuance. The limited license may be renewed for a successive four year period by filing a written application required by the Committee at least 90 days prior to the expiration of the current license. The application for renewal shall be accompanied by a non-refundable fee.

A lawyer admitted pursuant to the In-House Counsel Rule is required to pay the annual disciplinary assessment required of attorneys admitted to practice three years or more in Louisiana, and State Bar Association annual dues during the period of the limited license. The in-house counsel must also comply with the Louisiana Continuing Legal Education requirements.

If you have questions about the In-House Counsel Rule, please contact us, or the Louisiana Committee on Bar Admissions.

It is a situation we see repeated all too often. A successful small business owner is considering a major expansion - either by franchising or by opening more company-owned offices. The business has many of the key ingredients for success. However, as we investigate the trademarks of the business, we learn of potential problems.

We ask the client how he came up with the name and the Mirliton Man design. He tells us that when he started the restaurant his son's girlfriend offered to help. She was a college student at the time, majoring in marketing and advertising, and she also did some graphic design work. She drew the mirliton character. The idea for the name MR. MIRLITON'S was a joint idea of the founder, his son, and the girlfriend. A mirliton recipe was one of the signature dishes and they all thought it would be neat to have a name that included the word "mirliton." The girlfriend did the character for free; nothing was ever put in writing. The founder says he would always let her and her friends eat for free at the restaurant. She and the son broke up about two years after the third location opened and our clients are not sure where she is.

Does our client have a problem going forward with his ambitious plan to expand through franchising? He very well might. Trademark rights are acquired by use. Because the girlfriend never used MR. MIRLITON'S or the Mirliton Man character as a trademark, she cannot have any rights in the name or design based on trademark law.

The problem is the copyright. There is no copyright protection in single words or short phrases. Therefore, the girlfriend cannot claim to own the restaurant name -- MR. MIRLITON'S - even if she was the only person to think of it. However, original designs, such as the Mirliton Man character, are protected by copyright. The girlfriend, as author, owned the design of the creator. Even if the client had paid her, unless the ownership was transferred in writing, the ownership remains with her. So what kind of rights did the client get? The client has a license to the design. Copyright licenses do not have to be in writing, they can even be implied from conduct. And there is the problem. It is probably reasonable for us to assume that the implied license allowed the client to use the design for the three current locations. However, if the franchising plan goes forward the girlfriend may claim the increased use is beyond the scope of the implied license.

What is the best way to address this problem? The prudent course of action is to find the girlfriend and have her execute an assignment that clearly transfers the copyright ownership in the Mirliton Man design to the client. Even if she demands money, a reasonable amount paid now will probably be less than the attorney's fees or damages that could be incurred in litigation. If we ignore the potential problem and press on, and the girlfriend sees the franchise have wild success, she may demand a higher amount. If she cannot be found, we can send a letter to her last known address. The letter would state we believe that the license granted long ago includes the right to use the design on an unlimited number of locations, and the right to sub-license franchises to use the mark. Such a well-documented letter would show that the client acted prudently in case the girlfriend later appears and files suit.

The lesson learned here is an obvious one. Even with a small business, make sure you have the necessary rights to the intellectual property that is a key part of your business.

More on the proactive protection of trademarks, copyrights, and trade secrets.

The Lanham Act was passed in 1946 pursuant to Congress' power to regulate commerce. Section 43 of the Act prohibits false and misleading advertising, stating that "any person who uses in commerce any false or misleading description of fact, or false or misleading representation of fact, which . . . in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person's goods, services, or commercial activities, shall be liable in a civil action by any person who believes that he or she is likely to be damaged by such an act." This section of the Act was at the center of a recent Listerine ad campaign.

McNeil-PPC, Inc., the market leader in the sale of string dental floss and other cleaning products, filed suit alleging that Pfizer had engaged in false advertising in violation of Section 43 of the Lanham Act. McNeil contended that Pfizer's literal or explicit claim that clinical studies prove that Listerine is as effective as floss against plaque and gingivitis is false. It also alleged that Pfizer's advertisements implicitly are claiming that Listerine is a replacement for floss and that all the benefits of flossing may be obtained by rinsing with Listerine, which is false and misleading.

The Court agreed with McNeil and on January 6, 2005 issued a preliminary injunction. The Court concluded that the two studies did not stand for the proposition that Listerine is as effective as floss against plaque and gingivitis. The studies only included individuals with mild to moderate gingivitis and excluded individuals with severe gingivitis or any degree of periodontitis. Thus, the literal claim in Pfizer's advertisement was overly broad and consumers could have been misled by the advertisement. Second, the claim was false because the studies only prove that Listerine was effective as improperly used floss. The studies were not sufficiently reliable to permit one to conclude with reasonable certainty that Listerine was as effective as floss in fighting plaque and gingivitis.

The Court also concluded there was implied falsity that Listerine was a replacement for floss; the benefits of flossing could be obtained by rinsing with Listerine; and that those consumers who did not have the time or desire to floss could switch to Listerine instead. The implied message was confirmed by words and images, namely a stream of blue liquid tracking floss as it is removed from a floss container and then swirling between and around teeth and a bottle of Listerine balanced equally on a scale against a container of floss. Although the ads stated floss daily, the few words in the disclaimer were lost when the ads were considered as a whole. Thus, the implicit message was false, contrary to Pfizer's argument that Listerine provided all the benefits of flossing.

The Court enjoined Pfizer from communicating these claims in its advertising materials and ordered the parties to discuss a recall of the Listerine bottles that feature the hanging tags.

In a given year, the average American teenager and young adult will spend 868 hours (36 days) online. Roughly 20 percent of this time is spent IM (IM). One recent study showed that of the 24 million U.S. teens that go online, one in five, or about 5 million, considers IM their primary means of communicating with their friends. Why are so may young Americans hooked on this technology? What can the American business man or woman learn from his/her son or daughter? If IM is such an important form of private communication in America, is there room for it in the American workplace? Can IM be an efficient and profitable means of conducting business? Or is IM just another type of electronic communication gadget along with e-mail, voice mail, paging, Blackberries, and cellular?

IM (IM) is technology that has changes our world to the same degree as voicemail and email. IM is the voice of the internet and perhaps the best kept secret of business technology. IM allows users to 'talk' in real-time with each other through short text messages sent over the internet. These messages can be between only two users, or any larger number of users through the use of a chat room. A chat room is software that allows a group of people to type in messages that can be seen by everyone in the virtual room. To make contact with another person, IM users create a "buddy list" by adding screen names to a list. Anyone using the same IM program can be put on the buddy list and may be contacted. The buddy list advises the user when his buddies are signed on and available to chat.

IM has been wildly popular in American homes since 1996. That was when Mirabilis, a small Israeli internet communication company, introduced ICQ, the first free instant messaging utility. ICQ stood for "I seek you." Get it? Since 1996, three companies, AOL, Microsoft, and Yahoo!, have become the 'big three' in IM communication with the releases of their free IM utilities, AOL Instant Messenger (AIM), MSN Messenger and Yahoo! Messenger, respectively. These free software programs make it easy for anyone with an internet connection to join the worldwide online IM community. While many providers have developed IM utilities (which are not free) specifically for business use, the overwhelming majority of IM users use one of the free programs, even at work. Currently, AOL Instant Messenger leads the way with about 32 million users, followed closely by MSN Messenger with about 30 million users. Yahoo! Messenger provides IM services for 19 million users.
Why use IM in the workplace: The hidden gem of technology that could lead the workplace into the future of electronic communication.

IM has made significant inroads into the American workplace. Business people are taking notice of the advantages IM can offer. Roughly 26 percent of American companies now use IM as an official corporate communication service, and an additional 44 percent have employees that use IM on their own. What is it about IM technology that has so many companies adopting IM as a serious business tool? The most obvious and attractive advantage of this technology, and the thing that appeals to most business people, is its immediacy.

IM allows for informal and spontaneous conversation between co-workers, precisely the type of communication that is becoming less and less available as e-mail has become such a huge part of the corporate landscape and we find ourselves spending more time sitting in front of the computer. There is just not as much reason anymore to get up and have "real time" conversations. Everything we need to get through the workday is sitting in front of us in the form of a personal computer. IM is the next best thing to standing in the hallway and discussing work. As technology grows, we will have even more tools at our fingertips to keep us from walking to a co-worker's office. IM provides a real time conversation while only being an "alt tab" keystroke away from other software tools.

Speaking of the co-worker down the hall, if we did have a spark of inspiration and decide to walk down that long hall to discuss the latest contract or advertising idea, how do we know if our colleague is even in the office? An e-mail asking if someone is available could take much longer to receive and respond to than the busy workday allows. IM utilities, through the 'buddy list', instantly tells us when our 'buddies' are at the computer, waiting to be sent an IM or paid a visit in the office. In many cases, this presence awareness feature is more important to workplace IM users than online chat itself.

As useful as IM can be to co-workers right down the hall or in the same office, it is likely most important to those co-workers who are not in the same office. Geographically distributed teams constantly face communication problems. There is no substitute for the time when co-workers simply "kick things around" as a group to get a project completed or a deal closed. It is just not feasible for this type of communication to take place between teams with members located far apart. Some types of real-time communication, such as long-distance telephone calls and video conferencing, are too expensive and can be intrusive and bothersome. IM relieves these problems through free unlimited real time communication. IM can help workers meet deadlines and solve unexpected problems through instant communication and feedback, something we cannot get from e-mail.
Is all the news about IM good? Is it all roses and honey? Of course not. Care must be taken to limit the amount of confidential information sent via IM, and IM can certainly be abused by employees. Like all aspects of business, IM offers advantages and disadvantages.

One View - IM should be left at home with the kids. The potential pitfalls this technological monster could introduce into the American workplace.

Most of us have been there before; we finally find time in the busy work day to sit down and actually get some work done when it happens, the unavoidable and seemingly uncontrollable periodic e-mail check. Just as things were settled down and real work was about to take place, we find ourselves 10 minutes, 20 minutes, a half hour into reading and replying to short questions from friends and co-workers, reading the latest e-mail joke of the day, or deleting the piles of junk mail from a personal e-mail account accessed from work. For all of the added efficiency that e-mail has brought into our lives, that efficiency seems to be outweighed by the distraction email has become.

IM has the potential to become just as distracting as email, if no more so. No matter how much we try to ignore it, the temptation to drop a quick IM to a friend or co-worker, or to respond to one of the same, is always present. Through its immediacy, IM tends to create an atmosphere suitable to long conversations that can stray far away from the major points and quickly eat away time. Most telephone conversations, especially those in the workplace, invoke some sense of urgency. We tend to attempt to get the information that we need and conclude the phone call. Telephone conversations inhibit our ability to do other things, such as carry on a conversation with a person standing in the room or fully concentrate on work sitting on the desk in front of us. IM does not induce such a sense of urgency. It allows a user to momentarily turn away from the conversation to do something else without losing the natural flow of what is being discussed. This lack of urgency can make conversations by IM much longer than those by phone.

What about IM as compared to e-mail? Is IM just hyped-up e-mail? The major problems with IM, problems that are not presented to the same degree with e-mail, are virus susceptibility and lack of confidentiality. IMs are insecure transmissions and they may be the next big internet virus threat.

Most viruses sent by e-mail cannot infect a computer unless an attachment or other malicious file is opened. Also, most anti-virus programs check incoming email for viruses. The virus danger that IM presents is from "blended threat" viruses. These are viruses that attack and exploit specific software vulnerability. They do not need any help to spread (such as the opening of an attachment) because they find "holes" in the software and attack them instantly. While all software contains holes that could allow a blended threat infection, IM software is especially dangerous because of its prolonged exposure to the internet.

"On any given day, there are probably only a few minutes when a virus could exploit a vulnerability on your e-mail client. The chances are that you open your e-mail client for only a few minutes, pull down the latest messages, and then close it. But your IM client is generally open and running all day long, ready to receive messages at any point. This makes it much easier for someone to piggyback a virus on an IM and exploit the client's vulnerabilities. And thanks to your IM 'buddy list,' an IM blended threat could spread with inordinate speed. Past speed demons like Code Red and Slammer spread by systematically scanning the Internet for vulnerable hosts. But an instant-messaging blended threat wouldn't have to do that. After infecting one IM client, it could just send itself to everyone on the client's buddy list."

The other major IM security issue is confidentiality. IMs are generally very easy to intercept and, because they are transmitted in plain text (rather than in encrypted text), they can be read by the person intercepting them. While IM encryption software is available, it is not free. Because of the cost IM encryption is rarely used. Any discussions conducted over the free IM services should be assumed to be public conversations. Therefore, in the workplace IM messages should carry the standard confidentiality messages that are used in email. Of course, you can see that it can be impractical to include such a warning message in every IM conversation.

Another area where IM lags behind e-mail is its record keeping abilities. When using one of the free IM providers, once the conversation is over and the program is closed, the messages are lost. In contrast, e-mails are stored in an Old Mail or a Sent Mail folder. IM conversations could be cut and pasted into a word processing document, but the majority of business people do not want to take the extra time to do so. Some IM products offer the option to log the chat sessions, but this requires the chat to be written to a text file on the logging computer's hard drive. The logging feature presents more confidentiality problems because the text file can be easily accessed from the hard drive by another user, either inside or outside of the office.

Even if the chat sessions were logged, IM conversations, especially long ones, are not easy to look back upon to find information. They are written to be instantaneously read and replied to, unlike e-mail messages, which are written with the expectation that the recipient will read the message when the opportunity arises, and respond at some later time. Those different writing styles make a huge difference in the ease of rereading and the practicality of keeping useful records. An entire IM language has developed - BTW for "by the way," BRB for "be right back," and IMHO for "in my humble opinion" are just a few of the myriad shorthand terms used in IM.

There is an additional concern with IM in a workplace setting. IMs invite us as users to be very casual, speaking (or typing) what is on our mind that very instant. Writing an e-mail is more like sitting down to write a letter, albeit often a grammatically incorrect one with lots of misspelled words. IM is akin to a hallway conversation and can lead to embarrassing mistakes that many business people would rather not be seen by their sophisticated customers and colleagues.

Those sophisticated customers and colleagues may offer an even bigger problem for workplace IM than embarrassment over spelling mistakes. The biggest obstacle to IM becoming a serious business tool is its acceptability. This statement may seem like circular analysis. However, with software, reaching "critical mass" is the key to success. In other words a software application is not really useful until enough people are using it.

Market penetration is an important issue for IM software developers because most business people today do not feel that they need IM tools to get their work done. One reason for this perception is that IM is not a replacement for any other tool, such as the telephone or e-mail, for which there is a recognized need. Also, most business people perceive IM as a form of goofing off rather than doing any real work. Of course, whether IM in the workplace is used for working or goofing off is largely dependant on the user; but until the perceptions have changed and the critical mass of users develops, IM will remain at the end of the list of necessary business tools in the American workplace.

TO CHAT OR NOT TO CHAT, THAT IS THE QUESTION

While IM use may not be not be at 100%, employees at many companies round the world are using IM software at work every day. The question now becomes whether companies should push IM out of the workplace or encourage its use. The decision must be made carefully, and with one end result in mind: better business. It makes perfect sense for certain types of companies to use IM every day. Employees at IBM, for instance, send three million instant messages every day. They use IM for a wide range of communications - everything from keeping in touch with co-workers to answering customers' questions. Most consumers expect that a company that manufactures and sells computers and computer software would be available via IM.

But what about other companies. As our technological society grows, so will its expectations. If these expectations push the American workplace toward instant online communication, that is where it will go. Even with all its attendant risks, IM seems to grow in popularity. It offers the big advantage of letting you communicate while you can still do other tasks on your computer. Hopefully American business people will get up from their computer occasionally and wander into the world of their teenagers. Otherwise, how will we predict the next major trend in business communication?

Russel Primeaux, a registered Patent Attorney, is a Partner with Kean Miller Hawthorne D'Armond McCowan & Jarman LLP in Baton Rouge, Louisiana. He has an Electrical Engineering degree from Georgia Tech and graduated, cum laude, from the University of San Diego School of Law; where he was a member of the Law Review. Mr. Primeaux's practice includes patents, trademarks, copyrights, internet law, and trade secrets. He teaches Patent Law as an Adjunct Professor at the LSU Law School and served as Chairman of the Intellectual Property Section of the Louisiana State Bar from 1997 to 1998.