Best Practices in Protecting and Enforcing Trademarks, Copyrights and other IP
Trademarks, copyrighted works, trade secrets and proprietary business information form the core of any franchise system, and are frequently a company’s most valuable assets. Trademarks, including service marks, logos, slogans and trade dress, define the brand identity as presented to the public. The “behind the scenes” business know-how on which the system is built and implemented by franchisees is embodied in a variety of copyrighted and proprietary works – operations manuals, proprietary processes, recipes and formulas, custom software, advertising copy to name a few.
Obtaining, maintaining and enforcing legal protections for these intellectual property interestsisof critical importance to all franchise operations. Following are some best practices to maximize your legal protection.
- Register all trademarks with the US Patent and Trademark Office for all goods and services your business offers.
- Monitor your trademarks as used on the Internet, in competitors’ advertisements, in publications and other media, and take prompt enforcement action against unauthorized users.
- Register domain names for all of your trademarks, including common misspellings and variations, and registerdomain names if available for names describing the products and services your business offers.
- Place copyright notices on manuals, customized software and other proprietary business materials.
- File copyright registrations with the U.S. Copyright Office for important works that are likely to be copied by competitors.
- Place prominent confidentiality notices on important internal business documents, operations manuals, and other proprietary information.
- Have your key officers and employees, as well as franchisees and their managers, sign confidentiality and non-compete agreements.
- Obtain written work for hire / copyright assignment agreements from all outside firms such as software developers, consultants, advertising agencies and design firms that produce any creative works for your business.
The last point is commonly overlooked, but it is a practice that every business must take. If you adopt only one practice as a result of reading this article, it should be this. Without written work for hire / copyright assignment agreements, your business will not have ownership of the copyrights to creative works your company has hired outside firms to produce. You will instead have only limited rights to use the works, and the outside firm will retain rights to use the works for others, including your competitors.
While this is not an exhaustive list, it is a good starting point to evaluate your current procedures. Franchisors that follow these practices will have taken the basic steps needed to secure legal protection for key intellectual property assets.
- James A. Wahl Monroe Moxness Berg P.A.
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These are difficult decisions. The solutions are not clear cut from a business or from a legal perspective. It is critical that a company in this position work with qualified counsel to identify an alternative that will have a reasonable basis for an exemption and still make sense from a strategic perspective. The balance of this chapter will look at the many alternatives currently being tested by many U.S. and oversees companies. As you can see, the lines of demarcation are not always clear. The differences between many of these alternatives may in fact be in name only. Some of these concepts are truly innovative and have not been truly tested by the courts or the regulators. In these borderline cases, a regulatory “no-action” letter procedure is strongly recommended. Other concepts are not very innovative at all and merely borrow from long-recognized and analogous legal relationships such as chapter affiliation agreements in the non-profit arena or network affiliation agreements in radio and television broadcasting.