Professional Documents
Culture Documents
IP Outline 1
IP Outline 1
1. General
a. Constitutional foundation
i. Art. 1 Sec 8. Cl. 8
1. Congress shall have the power…to promote the
progress of … useful arts, by securing for limited times
to…Inventors the exclusive right to their…discoveries
b. Theories of patent law
i. Economic theory- inventing is hard and takes time, we should
incentivize inventors by giving them the exclusive rights to the
patent for 20 years
ii. Natural rights- the person has put in the work and thus
deserves the spoils
iii. Personhood- it is a part of themselves and thus should be given
to them
2. Overview
a. Requirement of patentability
i. Subject matter
ii. Novelty (no precedent in prior art)
iii. Useful
iv. Nonobvious
v. Adequate disclosure (disclosed adequately for PHOSITA to
replicate)
b. Rights conferred by a patent
i. Patent owner has the exclusive right to exclude others from
doing the following on the claims of the patent for a specific
term of years (20 years):
1. Make
2. Use
3. Sell
4. Offer for sale
5. Import
ii. Claims- the exact thing that is being protected
1. Independent claim- the claim stands on its own w/out
the necessity of a prior provision
2. Dependent claim- incorporates all the limitation of the
independent claim
iii. This is not an affirmative right;
1. Statutory preclusion- other laws may actually prevent
patent owner from executing such as FDA or EPA (drugs
regulated before marketable)
2. Blocking patent- the production may be blocked by
other claim (claim that includes a basic piece of your
patent)
c. Patent Prosecution- goal is to draft as broad of a claim as the patent
office will allow
i. Definition- This is the back and forth process between the
applicant and patent examiner at the PTO
ii. Application process
1. File patent application
a. Applicants can file placeholder application, but
permanent application must be converted into a
full application within a year
2. Basics of application
a. The specification, including a summary of the
invention and drawings in most cases
b. One or more claims, at the end of the
specification
c. An oath declaring the inventors actually invented
what is described in the specification
d. Applicable filing fee
3. Application assigned to a main examining group and
then to a specific art unit
a. Examiner makes initial review
b. Applicant can file additional documents
c. If examiner rejects app, he must state reason
iii. Applicant appeals
1. Applicant can contest the rejection
2. Amend the application
3. If final rejection issued, the applicant can appeal to the
BPAI
4. If final on some but not all claims: applicant can file
amendment that cancels rejected clams
iv. Presumption of validity once patent is granted
v. Reissuance: Process of amending claims
1. You have 2 years form the issuance of the patent grant
to make changes to it that would broaden the grant
2. No time limit to narrow or to make scope change
3. Elements of patentability
a. General
i. Subject matter
ii. (novel) not proceeded in prior art
iii. Useful
iv. Nonobvious
v. Adequate disclosure (disclosure so that a PHOSITA can
recreate)
4. Subject matter
a. Analysis
i. Is the claim under the patentable under the statute?
ii. Is the patent directed at on of the excluded categories?
1. Does the claimed invention add an inventive concept to
the excludable area?
a. Must consider each claim individually and as a
whole
2. Is the concept tied to a machine tor is it used to
transform a material into something new? (only a
secondary consideration)
b. Patentable under statute
i. 35 USC § 101 “inventions patentable”
1. whoever invents or discovers any new and useful
process, machine, manufacture, or composition of
matter, or any new and useful improvement thereof,
may obtain a patent
ii. Types of Utility patents
1. Process patent
a. Process
b. Machine (moving parts)
c. (improvement thereof)
2. Product patent
a. Manufacture (generally no moving parts)
b. Composition of matter- combination of two or
more pieces of matter to form something new
c. (Improvement thereof)
3. Design patent (not on exam)
a. For ornamental pieces
i. 14 year duration
ii. take a long time o get, and just as
expensive as any other patent
iii. frequently invalidated
c. Exception that excludes from patentability
i. General
1. “Anything man made under the sun” is considered
patentable
a. There are however limitations on compositions
of matter and process claims
i. They are not patentable if the fall into one
of these categories because they are the
basic building blocks:
1. Abstract ideas
2. Natural phenomena
3. Laws of nature
ii. Abstract ideas
1. Business methods- a process
a. Business methods are not categorically excluded
from patentable subject matter, they just have to
add an inventive piece to the known method
i. Test
1. Does the patent add something
new to the business model other
than just say apply?
2. Does it produce a useful, concrete
and tangible product?
ii. Ex) Bilski v Kappos- process of changing
facts into hedging plan in not patentable
because hedging is a well known method
and all this does is apply it
2. Computer programs
a. Computer programs may be patentable if they
add something more than just basic algorithm
i. Alice Corp v CLS- patent that claims an
algorithm implemented on a computer
and said apply; no inventive concept was
used
iii. Natural Phenomena
1. Patentable (compositions of matter)
a. A man made microorganism is patentable
subject matter, if the organism does not
naturally occur in nature
i. Ex) Diamond v Chakrabarty- a bacterium
is genetically modified to eat crude oil
and is patentable because the item does
not occur in nature
b. Alteration of a material found in nature is
patentable
i. Ex) Association for Molocular Pathology v
Myriad Gentics- cDNA is patentable
because this alteration does not occur in
nature
2. Not patentable because natural phenomena
a. A man made copy of something that does exist in
nature is not patentable
i. Ex) Association for Molocular Pathology v
Myriad Gentics- the exact replica of the
DNA was not patentable because the DNA
existed in nature
b. A mere combination of material that is found in
nature that are not modified or altered is not
patentable
i. Ex) Bros. Seed Co. v. Kalo Inoculant Co.-
combining of natural bacteria into a
mixture for protecting plants from insects
was not patentable because the bacteria
were naturally occurring
iv. Laws of nature
1. general
a. E=mc is a law of nature and thus is not
patentable
b. Newly discovered mineral is not patentable
2. Merely taking laws of nature and combing and saying
apply in not inventive
a. Ex) MayoCollaborative Serv. v Prometheus- well
known methods of measuring metabolites and
laws of what level of drugs should be given are
combined into a patent and told to apply; not an
inventive concept
5. Novel (§ 102)
a. Which law applies
i. For patents filed before Mar 16. 2013 old law applies
1. Novelty defined from date of first invention (reduction
to practice)
a. 102(a) novelty-known or used in this country;
patented or described in printed publication in
this or a foreign country before invention (pg
266)
b. 102(b) statutory bars- invention was patented or
described in printed publication in this or a
foreign country; public use or on sale in this
country, more than year prior to application
2. geographic limitation- use, sale, known had to be in
this country
ii. For patents filed after Mar 16, 2013, new law applies
1. Novelty measured as of fate first application filed
2. There is no geographic restrictions
b. 2 part novelty analysis: Novelty + Statutory bars
i. Novelty: looks to see if claim is new as compared to any prior
art (this is based on another party’s prior art)
1. Anything known to or used by the public prior to the
appropriate date is considered prior art (see public use)
a. Prior use must have been in this country
i. Ex) Rasaire v National Lead Co- D uses P’s
method patents for prospecting for oil
and other hydrocarbons but did not
infringe because a 3rd party used the
method before invention in ordinary
business
2. Anything published prior to appropriate date is
considered prior art (See publication)
3. If category occurs before invention, novelty issue, if it
occurs after invention but before application statutory
bars issue (for new rules, must determine priority by
publication date)
ii. Statutory bars: looks to see if the part waited too long to claim
a patent
1. This can be based on the users own actions (ie
publishing an article about the technique; selling the
product; allowing the public to use the product)
iii. Publication
1. An article is considered published if it is accessible to
the public
a. Ex) In re Hall- thesis regarding the invention was
cataloged in a library in germany more than a
year prior to the application; because catalog is
open to the public it is theoretically accessible
iv. Public use
1. Public use- the non-secret use of a claimed process in
the usual course of producing articles for commercial
purposes is public use
2. Public use- occurs when one gives or sells his invention
to another to be used without limitation or restriction
a. Only one of the inventions need be used in public
to constitute a public use
b. The invention need not be seen by the public to
be considered public
3. Ex) Egbert v Lippman- corset springs invention; lady
wore for 2 years prior to application; there were no
restrictions on her use
4. Experimental use is an exception- if the item is being
given to the public merely to experiment on the
invention, it is not a public use
a. Factors for experimental use:
i. records of experiment kept?
ii. who conducted the experiment?
iii. degree of commercial exploitation during
testing
iv. evaluation under actual conditions of use
necessary?
v. testing systematically performed?
vi. monitoring of invention during testing
vii. nature of contacts with potential
customers
b. Ex) City of Elizabeth v Pavement Co- a patented
process for laying down wooden pavement that
was more durable and safer and was on ground
for 6 years prior to application; still
experimental because he attempted to control
use and constantly monitored it as the factors
necessitate
v. On Sale
1. Factors
a. commercial offer for sale, and
b. ready for patenting
i. reduction to practice
ii. preparation of drawings and descriptions
enough to enable PHOSITA
vi. Priority
1. Under 1952 act priority goes to the first to reduce the
invention to practice without abandoning the invention
a. Analysis
i. Who filed first?
ii. Who reduced first?
iii. Who conceived first?
b. Reduction to practice occurs when the invention
is operable for the function intended
i. Actual- a prototype has been created
ii. Constructive- filing a valid, enabling
patent application
c. Exception: where inventor was first to conceive
invention but last to reduce to practice
i. Priority retained IF first conceiver was
reasonably diligent in reducing to
practice
1. If D2 cannot prove conception
a. Diligence as measure from
just before the first
reduction of practice to his
own reduction date
i. Determination of
reasonable diligence
is based one a
balance of what the
reasons were for the
time taken off
2. If D2 can prove conception
a. Diligence as measured from
just prior to D2 conception
until own reduction date
3. If D1 conceive first and reduce
first, he wins
ii. If abandon at any point, lose the priority
date and new date begins when you
restart project
iii. Ex) Griffith v Kanamanu- claim over same
chemical compound; G conceived first, K
filed first; G stopped practicing for a while
and could not prove diligence between
just before k filing and his own so he loses
2. Under AIA
a. Priority based on first inventor to file
i. Must be inventor because of possibility of
stealing patent and filing
1. If party steals patent and files it
starts the 1 year clock
ii. Analysis
1. Who filed first?
2. Who publicly disclosed first?
3. Was disclosure w. in 365 days?
b. Novelty based on first to disclose
i. All reference to the work may be
considered prior art, thus any prior
disclosure will forbid novelty
1. So whoever discloses first
maintains novelty under (102(b))
ii. Without novelty there can be no priority
vii. Prior users rights (§ 5)- granted to private commercial use of
more than a year prior to disclosure
6. Useful (utility)
a. The product created by a process must be useful for the process to be
useful
i. It is not useful just because it is related to something that is
1. Ex) Brenner v Manson- process for creating a set of
steroids was denied because the steroids had no known
use, and the steroid could not be found useful just
because other steroids are
b. The product has is not useful if it currently has no know function
i. A claim must have substantial and specific utility
1. This looks at why the product is useful overall and why
it is specifically useful right now
ii. Ex) In Re Fisher- it is not useful to merely find the gene, the
claim must state why finding the gene is important and what it
actually does
7. Nonobvious- can’t be obvious to a PHOSITA
a. Difference in law
i. Old law- nonobvious when reduced to practice
ii. New law- nonobvious as of application date
b. Statutory basis (§ 103)- if obvious no patent; if created by mistake it
can be patented
c. Analysis
i. TSM test (teaching, suggestion, or motivation)
1. Patent is obvious if some motivation or suggestion to
combine the prior art teachings can be found in the
prior art, the nature of the problem, or the knowledge of
a person having ordinary skill in the art
a. Basically looks to see if the idea that is being
claimed had previously been mentioned in prior
art or by a PHOSITA
ii. Factors test
1. a determination of whether a patent is obvious requires
a case by case analysis of:
a. the scope an content of the prior art
b. the differences between the prior art and the
claims at issue
c. the level of ordinary skill in the applicable art
2. secondary factors such as the following may be
relevant:
a. commercial success, long felt but unsolved need,
failure of others, copy, unexpected results (such
as advances in collateral technology), near
simultaneous invention (lots of inventors are
trying to create fix at the same time)
iii. Obvious try test
1. Would it be obvious for a PHOSITA to use this method
to solve current problems in the field?
a. Requires defining the PHOSITA and
d. Ex) Graham v John Deer- improvement on a machine patent for
adding a shock absorber to vibrating shank plows was found to be
obvious, because difference between the two were negligible and it
was not a skillful invention
e. Ex) KSR Int v Telfax- a sensor is placed on speed petal to control
speed electronically and the patent is invalid because a PHOSITA
would have thought it was obvious based on the current art to place
the sensor there
8. Adequate disclosure
a. Written description
i. The written description contains the claims of the patent
1. Claims- these are the meets and bounds of application
(exactly what is being protected)
ii. The claims must not write onto prior art
iii. The claims must claim the actual work the inventor has done,
iv. The claims must claim all specific features and embodiments
that are later claimed
1. These should start very broad and slowly get more
narrow
2. Any use that you place in the claim may be limiting so
make sure to use broad language or non-limiting
language
v. If the part is not in the original claim it cannot be in the final
claim, and if it is not within the final claim it is not protected, so
start broad
1. Ex) The Gentry Gallery v The Berkline Corp- claim of
sofa was for a fixed counsel; the D had a movable
counsel so he was not infringing because a movable was
not within the claim of the patent
b. Enablement- must enable a PHOSITA to reproduce without undue
experimentation
i. Ex) Incandescent Lamp Patent- Thomas Edison had to try out
many different filaments and fly to asia and europe, thus the
prior patent containing the language all fibrous material was
not sufficient to permit PHOSITA to reproduce w/out undue
experimentation
ii. Manual for Patent Examination & Procedure (MPEP):
1. the breadth of the claims
2. nature of the invention
3. state of prior art
4. level of one of ordinary skill
5. level of predictability in the art
6. amount of direction provided by the inventor
7. existence of working examples, and
8. the quantity of experimentation needed to make or use
the invention based on the content of the disclosure
c. Best mode- the inventor is required to disclose the best, most efficient
way of performing that they know of as of the filing date
i. A failure to comply with this is no longer a basis of non-
patentable claim
1. Fraudulent disclosure can still be a basis
9. Direct Patent infringement (this is a strict liability tort/ no knowledge
requirent)
a. Claim interpretation
i. Policy-interpretation takes special training so the judge is
better suited to decide
1. Ex) Markman v Westview Instruments- claim
construction is a matter of law
ii. Cannons of construction
1. Pain meaning- Looks at the ordinary meaning of the
word, the contextual meaning of the word, or a
definition of a particular word
2. Disclaimer of subject matter- claims will not be
construed to contain that which has expressly been
disclaimed
3. Claim differentiation-the contextual meaning will be
gathered from the definition in other claims
4. Purpose or goal-the purpose or goal of an invention is a
contextual clue
5. Narrow construction proffered- when 2 interps are
possible the narrow interp wins
iii. Standards for construing claims
1. The claims of a patent define the invention to which the
patentee is entitled the right to exclude
a. Interpreting a patent
i. Begin with claims
ii. Use plain language/ ordinary meaning of
terms in the claims
1. Ordinary meaning is the meaning
of the term at the time of invention
iii. If no plain meaning is present move to the
contextual meaning of the terms
iv. If no contextual meaning can be gleaned
look at the other portions of the patent to
help define the terms
v. Use the ordinary meaning of the terms in
the other portions of the doc
vi. Then look at the contextual meaning of
the other terms in the patent
vii. If nothing can be gathered from all of this
begin to use external sources
viii. Begin with prosecution history
ix. Move to dictionaries and treatises as a
last resort
b. There is no rigid algorithm but instead a case by
case determination
c. Independent clauses must be read more broadly
than dependent clauses
d. The item does not have to exhibit every claimed
function at all times
e. If claim is still ambiguous after complete
interpretation analysis it is to be construed to
maintain validity of the claim
iv. Ex) Phillips v AWH Corp- claim determining what baffles
meant in relation to metal prison walls
b. Literal infringement- this is when a patent claim reads on an existing
claim
i. Every element of a patent claim must be literally infringed or it
has to be infringed under the doctrine of equivalents
1. Thus each element of the claim must be interpreted and
compared
a. Ex) Larami Corp v Amron- the SuperSoaker did
not literarily infringe because the housing of the
tanks language called for a housing and a tank
“therein“ where the other had the tank on the
top of the housing
ii. If the infringing product has an additional element, the
language must be read an if it is an open claim, it is still
infringement. if it is limiting, it is not literal infringement
1. Open- Comprising; containing; mixture are considered
open terms that broaden the claim to include the
possibility of additional elements
2. Limiting- Consisting of; is a limiting term that does not
permit for other inclusions of additional terms
c. Doctrine of equivalents
i. We don’t want to let would be infringers get by with exploiting
technical limitations, so we give some leeway
ii. Triple identity test: (asking if reasonable person w/in the
industry would find the products to be interchangeable looks
at the product as a whole)
1. Substantially the same function
2. Substantially the same way
3. To obtain substantially the same results
iii. all elements rule (looks at each individual element)
1. must match the function, way and result of the claimed
element, or
2. whether the substitute element plays substantially the
same role as the claimed element
iv. after arising technologies
1. considered to be equivalents because they were
unforeseen at the time of filing and thus covered under
equivalents
v. Limitations on the doctrine of equivalents
1. Prosecution history estoppel
a. Once a patent is narrowed, the patentee is
estopped from making an equivalent claim for
the ground between the original version and the
new version
i. Surrendering claim scope must occur
ii. Only estopped if the narrowing was
substantially related to patentability
iii. Can overcome presumption that
narrowing was for patentability if you can
prove:
1. Equivalent was unforeseeable
2. Rational underlying the
amendment bears no more than a
tangential relation to the
equivalent
3. Other reason that the patentee
could not have been reasonably
expected to describe the equivilant
b. Ex) Festo Corp v Shoketsu- claim for engine is too
broad so narrows to obtain patent claim; he
estopped from claimed an equivalence to the
broader claims
2. Pubic dedication rule
a. If you disclose a part of the invention in the
specifications, but not the claim, that portion is
deemed to have been dedicated to the public
domain
i. Policy- we don’t want a patentee to be
able to narrowly claim a patent and
broaden claim in description
ii. Specifications teach and claims claim
iii. Ex) Johnson & Johnson v R.E. Service- claim
says circuit board is patent is made with
aluminum, specifications say it could be
nickel of stainless steel; nickel and steel
are dedicated to the public domain
10. Indirect infringement
a. § 271 contributory infringement and inducement
b. Contributory infringement (§ 271(c))
i. Elements
1. Direct infringement- another party has to directly
infringe the patent in order for the other party to
contribute
a. No knowledge required of infringer
2. Party made/sold a component that is a material part of
the invention
3. Knowledge of a valid patent over part and that their
activity would infringe patent
4. Not a staple article of commerce
a. Staple article doctrine: staple article of
commerce that is capable that suitable for
substantial non-infringing use cannot be the
basis for finding contributory infringement
i. Ex) selling a screw driver does not equal
contributory infringement
ii. Analysis
1. Was there a direct infringement by a third party?
a. Determine the scope of the claim at issue
b. Examine evidence to see if the third party use
would infringe one of the patent rights
2. Did the party contributorily infringe?
a. Look at each element
iii. Ex) Cr. Bard v Advanec Cardiovascular Sys- Bard owns method
patent for using a catheter in in heart surgery. D makes a
catheter than can only be used to complete the exact method of
the claim. The Dr. uses the catheter and each contributory
element is found.
c. Inducement
i. A person induces by actively and knowingly aiding and
abetting another’s direct infringement
ii. Elements
1. Knowledge of both:
a. The existence of a patent; AND
b. That the intended activities will infringe that
patent/lead to infringing that patent
iii. Knowledge
1. Doctrine of willful blindness- an action taken to
deliberately keep from obtaining knowledge that would
prove culpability is knowledge
a. Ex) Global-Tech v Seb- SEB copied GT’s design for
a fryer and asked an attorney to conduct a right
to use study. Attorney did not find the prior art
and said making product was ok. SEB took action
not to know by not telling the attorney that they
copied the design so they were found to have
knowledge. They were aiding anyone retailer
who sold the fryer
d. Joint infringement
i. Control/ direction of all patented steps by a single party is
required to hold one part liable for joint infringement
1. We hold mastermind liable
ii. There can only be joint infringement when there is an agency
relationship between parties who performed the methods or
steps
iii. Ex) Limelight v Akamai Tech- a method patent for designating
components of websites to be stores on server. Limelight tells
users how to do the steps but does not actually help so no joint
infringement because no control over the execution.
11. Defenses- should not be culpable because (a-d) or patent is invalid or non-
infringing
a. Experimental use
i. Allows for the unlicensed construction and use of a patented
invention for the purpose of pure scientific inquiry
1. This use cannot be for profit or for any business related
purposes
a. Ex) Madey v Duke Univ- Duke argues that the use
was non-profit, but the court did not allow
because it was still for business purpose
ii. There is an experimental use exception for prescription drugs
to ensure that generic drugs can make it to the market as soon
as the patent expires
b. Inequitable conduct
i. Elements ( must be shown by clear and convincing)
1. Knew of the prior art reference
2. Knew that it was material
3. Made a deliberate decision to withhold it or submit false
info/ had an intent to deceive
c. Patent exhaustion
i. The first unrestricted sale of a patented product exhausts the
patentee’s control over that product and it can be resold or
repaired without implicating the patentees rights
1. However, the purchaser still cannot reconstruct the
patented product or make another copy
a. Ex) Bowman v Monsanto- the product of self
replicating inventions is still subject to the no
make provision; thus seeds that come from the
prior plants cannot be used for reharvest
without a new license
d. Patent Misuse
i. A judicially created doctrine that bars patentees from
enforcing their patent against infringers when they have
misused the patent; ends when misuse ends
1. Ex) Motion Picture Film v Universal Film-patent holder
cannot extend the physical or temporal scope of the
patent
12. Remedy
a. Injunction
i. Typical relief because damages for unique item are hard to
calculate
1. Typically leads to a licensing agreement
ii. Balancing test for injunctive relief (eBay v MercExchange test)
1. Likelihood of success
2. Irreparable injury
3. Damages inadequate to compensate
4. Under balance of hardships, equitable remedy
warranted
5. Public interest would be served
b. Damages
i. Lost Profits
1. Test to determine lost profits (Panduit Corp v Stahlin
Bros):
a. Demand for patented product
b. Absence of acceptable non-infringing substitutes
(any economic substitute)
c. The Co’s marketing and manufacturing
capabilities to exploit said demand
d. The amount of profit he would have made
ii. Reasonable royalty
1. The P is entitled to damages adequate to compensate
for infringement, but at not time less than a reasonable
royalty for the use made by infringer
a. The difference between where the patent owner
is versus where he would have been
2. 14 factors to consider
c. 4 theories that have been used to increase damage awards:
i. Price erosion
1. The patentee could have charged more for the thing if
the infringer hadn’t been there
a. Could have charged what the infringer charged
plus more
ii. The “market share” rule
1. The patentee should get a % of the infringer’s sales
proportionate to the patentee’s % of the market
a. We assume the patentee’s market share remains
the same even in the absence of the infringer.
iii. Lost sales of unpatented components or product
1. Patentee lost sales on nonpatented items.
a. Court looks to see whether unpatentable
components at issue are functionally integral to
an overall product whose consumer demand is
based on the patented thing.
2. At least one court extended this theory to cover a
nonpatented competing product in the same market
iv. Post-expiration sales
1. Infringement during the term of the patent gave the
infringer a head start on post-expiration sales since the
infringer didn’t have all the startup costs The
infringer got to make a profit quicker and thus less of
the patent period is unprofitable.
Remember: there is no criminal liability for patent infringement in the
United States. There is the possibility of criminal liability in copyright, trade
secret, and trademark law—but not in patent law.
Trade secret
1. Overview
a. Definition
i. Trade secret is any information used in one’s business that
gives its owner an opportunity to obtain an advantage over
competitors who do not now know or use the secret
b. Trade secret protection grants holder the right to:
i. Prevent disclosure of the information
ii. Prevent misappropriation of information
c. Duration of protection
i. Protection lasts as long as the info remains a secret
d. Source of Law
i. State law
1. Basis is tort restatement, and
2. Uniform Trade Secret Act
e. Elements of trade secret claim
1. Subject matter
a. The type of knowledge of information that trade
secret was meant to protect, and it must not be
generally known to all
i. Information must be a secret
1. It must be valuable because it is a
secret
a. Public disclosure destroy
secrecy
2. The holder must take reasonable steps to maintain
secrecy
3. Must show that D acquired the information wrongfully
f. Policy
i. Property/Utilitarian- protecting against the theft encourages
investment
ii. Tort- we want to deter wrongful acts
2. Subject matter
a. Defintion
i. Information, including a formula, pattern, compilation,
program, device, method, technique, or process that:
1. Derives independent economic value by not being
known to, or readily ascertainable by proper means by
other persons who an obtain economic value from its
disclosure or use, and
2. Is the subject to efforts that are reasonable under the
circumstances to maintain its secrecy
b. Elements
i. Valuable because it is a secret
ii. Not readily ascertainable or generally known
iii. Reasonable precautions taken to maintain secrecy
c. Factors to determine if a trade secret:
i. Is disclosure limited?
1. Looks at the extent to which the information is known
outside the claimants business
2. Looks at the extent to which it is known by employees
and others involved in the business
ii. The extent of measures taken by the claimant to guard the
secrecy of the information
iii. The value of the info to the business and its competitors
iv. The amount of effort or money expended by the business in
developing the information
1. Ex) Metallurgic Industrial v Fourtek- Meal spent lots of
time, effort, and money to make changes to stove
v. The ease or difficulty with which the information could be
properly acquired or duplicated by others
1. Information must not be generally known or readily
ascertainable
a. Ex) client list is readily ascertainable
d. Ex) Metallurgic Industrial v Fourtek- new technique for heating metal
and creating stove to heat metal was known and party took
reasonable measures to ensure that the secret was not known to more
than needed it
3. Reasonable effort to maintain secrecy
a. Must show that they have taken reasonable steps under the
circumstances to prevent disclosure
b. Public disclosure eliminates secrecy of the info, but refraining from
pubic discosure is not enough. Must include certain efforts to prevent
theft or use of the idea by former employees
i. Factors to consider:
1. Precautions taken to guard
2. Access given
3. Ditribution to public
4. Amount spent on precautions
ii. Ex) Rockwell Graphic v DEV Indus- making former employee
sign a confidentiality agreement, had authorized personnel
only signs, employees were required to destroy any copies that
were made
c. Perfect security is not optimum security (doesn’t need to be perfect)
4. Disclosure of trade secret
a. A public disclosure of a trade secret destroys the secret
i. As long as a trade secret remains a secret it is protected
b. Disclosure occurs in a number of ways:
i. Publication- published in a journal or academic forum
1. Secrecy is lost and thus protection is lost from
publication
2. Common form of publication is filing for patent
(application is published after 18 months)
a. If published by a thief, it starts the one year clock
on filing for a patent
ii. Sale of a commercial product that embodies the secret
1. The sale does not have to occur if the secret is freely
disclosed during manufacturing or development
2. Only secrets that are apparent to the buyer are
disclosed, secrets that are not apparent (ie computer
codes) are not disclosed
a. Ex) Data General Corp v Digital Computer- gave
design codes to purchasers who wanted to fix
and maintain their product; NDA agreement
included
iii. Publicly disclosed by someone other than the trade secret
owner
1. Commonly when someone has independently
developed or discovered the secret
2. Misappropriation is another way of disclosure by
someone else
iv. Inadvertent disclosure (negligence)
1. Must be through not taking enough precautions
a. If it is merely done through a mistake, it is often
not considered a disclosure
v. Government required disclosure
1. Ex) requiring a food manufacturer to label its food with
accurate list of ingredients
2. Health and environmental concerns are common
reasons for the government to require disclosure of
product contents
5. Misappropriation of trade secret
a. Definition
i. Acquisition of a trade secret of another by a person who knows
or has reason to know that the trade secret was acquired by
improper means; or
ii. Discloser or use of a trade secret of another without express or
implied consent by a person who
1. Gained through improper means; or knew person giving
to him had acquired through improper means or was in
a confidential relationship with owner of the secret; or
knows that the knowledge was disclosed to him by
mistake
b. Two basic situations where there is a misappropriation
i. Secret gathered through improper means
ii. Acquisition of secret involves a breach of confidence
c. Improper means
i. Generally occurs when the party does not spend the time and
money to discover independently
1. Proper way to get info is through reverse engineering or
independent research
a. Ex) E.I. DuPont de Nemours v Christopher- renting
a plane and taking aerial shots of a building that
was being built and the chemical system that
was being built to create ethanol was not the
proper means of independent research
d. Confidential relationship
i. An agreement to keep the information confidential
1. Can be express through a NDA contract
2. Can be implied through a position of trust
a. If parties knew or had reason to know the
disclosure was intended to be in confidence
b. The other party was reasonable in inferring that
the person consented to an obligation of
confidentiality
ii. Ex) Smith v Dravo Corp- delivery of design plans to the D for
the possibility of sale put the D in a position of trust as they
knew the relationship was purchase or don’t use
6. Proper means
a. Categories of proper means of obtaining a trade secret:
i. Discovery by independent invention
ii. Discovery by reverse engineering; the acquisition of known
product must be by a fair and honest means such as by
purchasing on the open market
iii. Observation of the item in public use or on public display
iv. Obtaining the trade secret from published literature
b. Reverse engineering
i. Reverse engineering is a proper means of acquiring a trade
secret if:
1. You start with the known product and work backwards
2. The known product was acquired in a fair and honest
way on the open market
3. The information cannot be gathered through a
confidential relationship with the maker
ii. How to protect:
1. Document process
2. Have someone reverse engineer and then give a
separate team design specifications
3. Keep anyone who may be questionable separate from
the project
4. Make everyone sign NDA; review prior agreements;
encypt info
iii. Ex) Kadant v Seeley Machines- the party hired a competitors ex-
employee and had him work on developing product, but there
was no proof that he was a part of the projects so no missaprop
7. Departing employees
a. General
i. Injunction on employee is only typically allowed for long
enough to negate unfair advantage
1. Courts consider economic impact on the prior Co and
the employees ability to work
b. 3 categories of employees (how to determine invention assignment)
i. Employee hired to invent
1. Employer owns the invention
ii. Employees who invent on the employers time using the
employers resources
1. Employer has non-exclusive shop right to practice the
invention
a. if employee leaves, he can take inventions with
him, but the employer can continue to use
iii. Employee independently invents
1. Employee owns the invention
c. Contracts and provisions restricting use of trade secrets
i. Confidentiality- agreement not to disclose confidential info
ii. Invention assignment- agreement that all inventions created
while in the scope of employment belong to employer
iii. Noncompetition agreements-the employee will not compete
for a temporal limit within a set geography and genre
iv. Trailer clause-a contractual provision that requires employees
to assign their rights not only in inventions made during the
period of employment but also for a certain time thereafter
1. Generally, these clauses are enforceable only to the
extent the temporal limitation is reasonable
v. Contracting for the licensing of the trade secret is a good way
to get the product to market
1. Contracted for terms will be expressly enforced
2. Ex) Warner-Lamber Pharm v John J Reynolds- contract to
continue to pay for Listerine formula had to continue
even after the became public knowledge
vi. Ways to protect
8. Remedies
a. Civil liability
i. Injunctions
1. Actual or threatened misappropriation may be enjoined
2. If no injunction is warranted, court may condition
future use on payment of reasonable royalty
3. Affirmative acts to protect a trade secret may be
compelled by the court
4. Balancing test for injunctive relief (eBay v
MercExchange test)
a. Likelihood of success
b. Irreparable injury
c. Damages inadequate to compensate
d. Under balance of hardships, equitable remedy
warranted
e. Public interest would be served
ii. Damages
1. Compensatory (actual loss)- may obtain actual for
unjust enrichment caused by misappropriation
2. Punitive- only if willful or malicious misappropriation
may get 2 times actual
3. Attorney fees- only if claim made in bad faith, motion to
terminate injunction made in bad faith, or willful
b. Criminal liability
i. Sources
1. Economic Espionage Act
2. Interstate Transportation of Stolen Property Act (ITSP)
ii. Punishments
1. Fines
2. Jail time
iii. Distinguished from civil remedies:
1. Criminal record
2. burden of proof higher because freedom at stake
iv. Why civil over criminal
1. Avoid public trial and thus disclosure of the secret
2. Relief is delayed when criminal action is brought
Copyright
1. Overview- used to protect original works of authorship (writings)
a. Legal Basis
i. Constitutional foundation
1. Art 1 § 8 cl 8 “Congress shall have the power to promote
the progress of science…by securing for limited times to
authors…the exclusive rights to their writings”
ii. Statutory Scheme
1. Codified in title 17 of the USC
a. 1909
i. provision in which copyright protection
subsisted upon publication
b. 1976
i. current provision, copyright protection
exists upon fixation
b. Policy
i. Authors rights/ Personhood- the work is a part of the author
and they have the natural rights to the
ii. Utilitarian- we want to incentivize authors to create more
products and to create more products for public consumption
1. Need a balance between giving right to authors and
keeping enough in the public domain for future
progress
c. Elements
i. Subject matter-must be expression that is within one of the
copyrightable categories
ii. Originality- must express a modicum of originality that was
independently created
iii. Fixation- must be fixed in a tangible medium for and be able to
be copied or reproduced for more than a transitory duration
iv. Formalities- publication, notice, registration, deposit of copy
v. Authorship/Ownership- must be the author or have the
copyright transferred in order to bring suit
vi. Duration- life plus 70 years; 95 years/ 28+47 (75)
d. Rights of owner § 206-206(A)
i. Reproduction- the exclusive right to make copies or
phonorecords
ii. Derivative work- the exclusive right to prepare derivative
works, which are based on the original, but in different forms
iii. Distribution- the right to control the first sale and distribution
of the original and all copies or derivative works
iv. Public Performance and display- the exclusive right to control
the public performance and display of certain works
v. Moral rights- visual artists possess an attribution right in their
works as well as rights to prevent intentional distortion,
mutilation, or other modification of their work
e. Infringement
i. Direct- access & copy (probative similarity); improper
appropriation (substantial similarity)
ii. Indirect- (contributory, vicarious)
f. Defenses
i. Fair use (overall transformativeness plus 4 factors)
ii. Safe harbor (OSP safe harbor)
2. Subject matter
a. See § 102 for subject matter
i. PGS are subject to the useful article doctrine
ii. Architectural works have some special characteristics
b. Limitations on copyrightability
i. Idea/ Expression dichotomy- expression is copyrightable,
but underlying ideas are not
1. Underlying idea/ teaching of a book are not
copyrightable, but actual words (expression) contained
in the book are
a. Thus you can follow instructions of book to make
the thing described, you just can’t copy the
instructions
i. Baker v Seldon- book made on how to
make bookkeeping charts and the charts
made based on teachings were not
copyrightable
2. Merger doctrine- where only a finite number of ways
exists to express an idea, the idea and expression merge
into an uncopyrightable whole
a. Ex) Morrisey v Procter & Gamble- the instruction
for a sweepstake cannot be copyrighted because
there are only a limited number of ways to write
the sweepstake rules
b. As the number of ways to express an idea
expand, a “thin copyright” is granted
i. Thin copyright- only protects works from
virtual identical copying
ii. Scenes a fair- the incidents, characters or setting which are
indispensible to, or at least standard in the treatment of a topic
are not protectable because they are the basic ideas and
building blocks
1. Ex) descriptions of the Hindenburg crash are scenes a
fair
iii. Useful article doctrine
1. Only the separable elements of a useful article are
subject to copyright protection
2. Analysis
a. Is the item a PGS work? (Is yes move on, in no it
doesn’t matter if it is useful)
b. Is the item useful? (if yes move on to separability
analysis; in no it is copyrightable)
3. A “useful article” is an article having an intrinsic
utilitarian function that is not merely to portray the
appearance of the article or to convey information
4. Separable Tests
a. Physical Separability-an expressive element of
a useful article is physically separable if it can
stand alone from the article as a whole and if
such separation does not impair the utility of the
article
i. Ex) Mazer v Stein- statuette was
copyrightable because it was separable
from the utility of the lamp
b. Conceptual separabilty
c. Tests:
i. Primary vs secondary purpose of the
object
1. Court looks at the intent in
creation (was it to create a
functional or artistic piece)
Ex) Kieselstein v Accessories by Pearl-
primary purpose of belt buckle was
ornamental and not functional so
copyrightable
Ex) Brandir Int. v Cascade Pacific- the
bike racs were redesigned for
functionalty
ii. The useful article would still be
marketable to some significant segment
of the community simply because of its
aesthetic qualities
1. Nimmer
2. Ex) Paper weight ball that is
ornamental may still be marketed
to the public because of
ornamental components
iii. The article stimulates in the mind of the
beholder a concept that is separate from
the concept evoked by its utilitarian
function
1. Carol Barnhart v Econ- torso forms
used to display clothing not
separable as there was no artistic
element to the torso
iv. The artistic design was not significantly
influenced by functional considerations
1. Brandir v Cascade- bike rack was
redesigned to meet the
functionality requirement
v. Artistic features can stand alone as a
work of art traditionally conceived and
the useful article in which it is embodied
would be equally useful without it
vi. Artistic features are not utilitarian
d. Ornamentation is an artistic element which can
be conceptually distinct from its function
i. Kieselstein v Accessories by Pearl
iv. Governmental Works- no copyright protection for govt works
1. Statute
a. § 105
i. Copyright protection under this title is
not available for any work of the United
States Govt., but the Govt can receive and
hold coprights that are transferred to it
by assignment, bequest or otherwise
b. § 101
i. works prepared by an officer or employee
of Govt if it is done as part of their official
duty
2. Court Opinions can’t be copyrighted
3. Originality
a. General
i. Elements
1. Must be independently created
2. Must have a minimum quantum of creativity
a. Feist Publications v Rural- phonebook is not
original because it falls below the level of
creativity
ii. Rules
1. Judges shall not determine what is art
a. Bleistein v Donaldson- creation of a circus poster
just showing people doing their acts was
sufficient for originality
2. Copyright will not be given merely because the person
worked hard; sweat of the brow theory is dead
a. Feist v Rural
3. Only needs to be new to the author; novelty is not a
requirement
a. Alfred Bell v Catalda fine Arts- copying a picture
that was in the public domain into an engraving
was original because it was the artists take on
the picture
4. Slavish copying is not original; it has to be more than
merely changing mediums
b. Special Circumstances
i. Photograph
1. Selection of pose, costume, lighting angle, timing, and
composition is sufficiently original to qualify for
protection
a. Burrow-Giles v Sarony- photo of Oscar Wilde is
original because photographer chose clothes,
setting, and lighting
2. Photo is original in three respects:
a. Rendition- how the photographer choses to
depict something
i. Ex) Photo depicting Babe Ruth in crown
b. Timing- when the photo was taken may make it
original
i. Ex) taking a photo right before shark bites
swimmer
c. Creation of the subject- creates the scene or
subject
i. Ex) photo of Oscar Wilde
ii. Mannion v Coors Brewing Co- photo of
Garnett was original in the creation of the
subject through the selection of pose,
wardrobe, and scene so using the same
subject would be infringement
ii. Compilations
1. Data
a. The originality persists in the selection,
arrangement, and coordination of the facts
i. Feist v Rural- the arrangement of a
phonebook in alphabetical order is
“practically inevitable”
b. Professional Judgment and Expertise on how to
include data and what data to include is original
i. CCC Info Servs v Maclean Hunter Market
Reports- red books were sufficiently
original in their selection and
coordination of the facts and the
professional opinions on how a value will
be in a current market
c. Professional judgment still must contain some
originality
i. Mathew Bender v West Publishing Co-
professional judgment on where to place
a page break is not creative
d. There is no copyright in facts
i. Fictitious facts that are held out to be true
are not subject to copyright protection
because they are considered facts
1. Oliver v Saint German Foundation-
copyright owner said his
manuscript had been dictated by
alien
iii. Derivative Works
1. Statute
a. 17 USC § 101
i. a work based on one or more pre-existing
works
2. Only the expression added to the original works are
copyrightable
a. The expression is only copyrightable so long as
the party had permission to use the underlying
work
i. Schroch v Learning Curve Int- the photos
of Thomas the Train were derivative
works because they portrayed him in
scenes and the Co gave permission to
create the derivative works
3. The originality requirement for derivative works is not
more demanding than the originality requirement for
other works
a. Schrock v Learning Curve
4. the addition of something more than a mere trivial
variation is considered original
a. Baitlin & Son v Snyder- Uncle Sam Piggy Bank is
reproduced in plastic rather than bronze with
only minute alterations is not a derivative work
4. Fixation
a. Elements
i. Fixed in a tangible medium of expression
ii. Sufficiently permanent or stable to permit it to be perceived,
reproduced, or otherwise communicated for a period more
than a transitory duration
iii. Fixation must have been by or under the authority of the
author
b. Special Situations
i. Repetition of a transitory image or set of images qualifies as
fixed
1. Williams Electronics v Artic Int- repetitive image of
video game is fixed despite player causing image to
change because the game is held in RAM until shut off
ii. Live broadcasts/ performance
1. Live broadcast is considered fixed if it is recorded at the
same time as the broadcast
a. The recording has to be authorized in order to be
fixed (protection comes from anti-bootlegging
statutes)
iii. Computer cache
1. Transferring files from memory to ram is copying
because the items become fixed in the RAM even though
fixation is temporary
a. Ex) MAI Sys Corp. v Peak Computing- loading
software into the RAM was considered copying
because it can be reproduced and perceived
b. Ex) Cartoon Network v CSC Holding- fixation in
RAM for 1.2 seconds was not sufficient for more
than a transitory period
5. Formalities
a. Publication of the work
i. 1909- Protection triggered by publication (which includes
notice, registration, and deposit)
1. Limited publication- distribution of copies to a
definitively selected group and for a limited purpose,
and without the right of diffusion, reproduction,
distribution or sale
a. Public performance or display- not publication
unless tangible copies of the work were
distributed to the public
i. Ex) Estate of Martin Luther King v CBS-
delivery of “I have a dream” to a large
audience and was broadcast on tv and
radio was not publication; copies only
given to the tv hosts for limited purposes
of comment
2. General publication- (divests rights and places in the
public domain) unlimited distribution to anyone that is
interested
ii. 1976- Publication useful to determine when notice should be
given
1. Publication turned on physical transfer of copies to
general public without disclosure restrictions, or to a
narrow group for purposes of distribution or
dissemination
2. Public performance or display is still not publication
iii. 1989 (After Berne)- publication defines the work for hire
duration; deposit is only mandatory after publication;
statutory damages depend on the publication date (3 months)
b. Notice of copyright
i. 1909- notice must include: (1) year of first publication (2)
mark suggesting copyright (3) name of the copyright holder
1. Failure to abide by this resulted in a forfeiture
ii. 1976-Still a notice requirement, but more lenient as copyright
protection shifted from publication to fixation
iii. 1989 (After Berne): no longer required, but encouraged by
making innocent infringement claim unavailable if there is
notice
c. Registration of the work in the copyright office
i. 1909- registration was required to bring an infringement claim
and was also required to get the 28 year renewal
ii. 1976- no renewal for post 76’ works so congress gave
incentives for people to register works created after 76’
1. registration gave prima facia case of valid copyright
2. must register before bringing infringement action
3. statutory damages and fees can only be had for post
registration infringement (register early incentive)
iii. 1989 (After Berne)- same for domestic, but no registration for
foreign Berne member nation
d. Deposit of a copy of the work with the library of congress- 2 copies of
best version of the work (to grow library and make record)
i. 1909- deposit was required for registration and failure to
deposit forfeited the copyright
ii. 1976- deposit is still mandatory, but it does not affect validity
of copyright or ability to bring suit. Failure to comply is just
subject to fines and stands in the way of registration
1. Special deposit rule for computer programs
a. Must deposit first 25 pages and last 25 pages
i. Anything less than 50 must deposit entire
work
b. If trade secret, must send accompanying letter
6. Authorship
a. General
i. 3 Types of Authorship
1. Sole
2. Joint
3. Works for hire
ii. Determination of author is important because the right to the
copyright vests in the author
1. Work must have been created by (or rights be held by)
the party bringing suit
iii. Rules
1. Only a human can be an author
a. Machine or animal cannot be an author
i. Monkey taking picture case- monkey not
author
b. Sole Authorship
i. Author is the source of original individual conception
1. Party that exercises a high degree of control over the
creative process is considered the author
a. Lindsay v Titanic- guy filmed titanic with sub,
and machines did filming but he maintained
control so he is the author
c. Joint Authorship
i. Statute
1. § 101
a. Joint work- a work as prepared by two or more
authors with the intention that their
contributions be merged into inseparable or
interdependent parts
ii. Things considered when determining joint authorship:
1. Control
2. Intent
3. How time billed
iii. Rules
1. Contributions made by joint authors must be
copyrightable contributions
a. Erickson v Trinity Theatre- actors contributions
were not copyrightable so they were not joint
authors
2. Intent
a. Must intend that the parts are to be combined
into an inseparable whole
b. Must intend that the parties are joint authors
i. Aalmuhammed v Lee- there was no intent
that Aalmuhammed be a joint author
despite the contributions he made to the
Malcolm X character
3. Joint authors must have decision making authority/
control over the product in order to be considered a
joint author
a. Aalmuhammed v Lee- Aalumhammed only made
suggestions and had no decision making
authority
4. How the parties bill their time is a factor that is
considered
a. Aalmuhammed v Lee- Aalumhammed billed his
time as a consultant
d. Works for hire
i. 2 ways that it can be a work for hire
1. employee within the scope of employment
2. special ordered or commissioned works (writing + 9
categories)
ii. employee within the scope of employment
1. employee- define by the common law principle of
agency
a. factors considered for employee
i. is it the type of work that the employer
usually does
ii. can the employer give the employee more
work
iii. what kind of control does the employer
have over when and how the project is
completed
iv. whose tools are used
v. where does the work take place
vi. how much skill is required to complete
the work
vii. duration of relationship
viii. how does worker hire assistants
ix. what kind of benefits does worker get
b. Ex) Community for Non-Violence v Reid- created
nativity sculpture of homeless people was not a
work for hire because he was not an employee
c. Ex) JustMed v Byce- tech company started in an
informal manner, but Byce is an employee
despite the fact that the factors weigh against
employee because of the nature of tech start ups
2. Within the scope of the employment
a. 3 factors considered
i. is the work the kind the employee was
hired to perform
ii. did the work substantially occur within
the authorized time and space limits
iii. is the work actuated, at least in part by a
purpose to serve the master (does it
benefit the employer in any way)
b. Ex) Rouse v Walters & Assoc- people work for
university as researchers and make a computer
program while at work; this is considered a work
for hire
iii. Special ordered or commissioned works
1. Elements
a. Agreement must be in a signed writing
b. Work must fall within one of the 9 categories
2. Signed writing
a. Policy
i. Passes the statute of frauds
ii. Makes the IP marketable as it clearly
defines ownership
b. Circuit split
i. 9th circuit
1. signed writing must preceed the
work
ii. other circuits
1. can memorialize the writing after
the work so long as it was decided
that it was a work for hire before
creation
3. 9 categories
a. found in definition of work for hire
b. If need be argue that even a perfect fit may fit
within one of the categories
e. Does not preclude the govt from hiring a contractor and having him
assign the rights
7. Duration
a. Congress has the ability to determine what is limited times
i. Ex) Eldred v Ashcroft- internet business that places all famous
works that are coming into the public domain in one location
for consumers, congress extends duration to life plus 70 is not
unlawful because it is still for a limited duration
ii. Policy- const foundation of limited time and promote progress,
here the inability to use does not allow for that progress
b. 3 Main Events:
i. 1909 Act
ii. 1976 Act
iii. Sonny Bono Act
c. 1909 Act (covered for anything before Jan 1, 1978)
i. Initial
1. 28 year plus 28 year renewal
a. must register to renew or second term did not
take effect and falls into public domain
b. formalities required
ii. extension due to 1976 act
1. 28 years plus 47 year renewal (75 years)
iii. 1992
1. registration for renewal became optional
a. works created after 64 didn’t require renewal;
now auto renewed
iv. Sunny bono
1. 28 plus 67 renewal (95 years)
d. 1976 Act (covered for anything that was created after Dec. 31, 1977)
i. initial
1. life plus 50 years
a. life of joint measured by last surviving author
i. no renewal needed
2. 75 years from publication or 100 years from creation
for pseudonymous works, anonymous works, works for
hire
ii. Sunny Bono
1. Life plus 70 years
2. 95 years from publication or 100 years from creation
for pseudonymous works, anonymous works, works for
hire
e. The decision: Does 1909 Act or 1976 Act govern?
1. Anything fixed in a tangible medium of expression after
Jan. 1, 1978, is governed by 1976 Act.
f. Debate over copyright duration debate
i. Con to extending duration:
1. Constitutional language “limited time”
2. we aren’t incentivizing anything by extending the
duration of copyright protection—we are only
extending the monopoly
ii. Pros to extending duration:
1. we want to promote progress
2. keeping up with the EU
8. Right to Reproduction
a. Statute § 106
i. Right to reproduce the copyrighted work in copies and
phonorecords
b. Not limited to exact copying, but instead to making substantially
similar copies (see direct infringement for analysis)
i. Independent creation is a defense to reproduction
ii. Ex) Google books- goggle scanned the books which are exact
copies thus an infringement
c. Computer Software
i. The literal and non-literal elements of a computer program
may be protected
ii. Only the expressionary versions of the code are protected not
the general ideas of what a program will do
1. Policy: if some are not copyrighted so be it; square peg
in round hole
2. 3 part analysis (Altai test): Abstraction, Filtration,
Comparison
a. 1) Abstraction: break down allegedly infringed
program into its constituent structural parts.
b. 2) Filtration: exam each of these parts for
incorporated ideas, expression that is
necessarily incidental to those ideas, and
elements taken from the public domain (these
are all nonprotectable)
c. 3) Comparison: Take the leftovers that are
creative expression and protectable and then
compare this with the structure of an allegedly
infringing program.
iii. Ex) Computer Associates Int v Altai- the new version of the
program only used the basic structure of what the code was
supposed to do and developed their own code, thus the
program was not an infringement
9. Right to prepare derivative works
a. A work based on one or more preexisting works that is recast,
transformed or adapted
i. Copyright subsists only in the new expressionary elements
b. If the party does not have the right to use the underlying work, they
cannot get copyright protection in the derivative work
i. Anderson v Stalone- Anderson makes version for Rocky IV and
Stalone uses many of those same ideas when he creates the
actual Rocky IV, but there was not protection in the work so
Staone can use freely
c. Must use a substantially similar analysis to determine if the work is a
derivative and thus an infringement
10. Right to Distribute
a. Copyright owner has the right to distribute either through sale or
other means original or subsequent copies of a copyrighted work
i. Closely related with the reproduction right
ii. Must actually distribute and not merely make available
1. Ex) Capitol Records v Thomas- placing of songs on site
for peer to peer transfer is not enough; there must be
actual distribution
b. First sale doctrine
i. § 109
1. the owner of a particular copy or phonorecords lawfully
made under this title, is entitled to sell or dispose of the
possession of the copyright
ii. Requirements
1. Lawfully made
a. A foreign copy has been lawfully made under
authorization of the copyright owner, so it may
be freely resold within US
i. Ex) Kirtsaeng v John Wiley & Sons-
importation and sale of international
copies of textbooks was ok because they
were lawfully made
2. The copy was transferred under the copyright owners
authority
a. Ex) the copyright owner authorizes foreign
places to manufacture and sell product
3. The defendant is the lawful owner of the copy in
question
4. The defendants use implicates the distribution use only,
not the reproduction right
iii. Right to import- importing is a violation to the right to
distribute so subject to first sale and all other exceptions
1. Anything made in the US may be exorted, resold, and re-
imported
a. Ex) Quality King v L’Anza Research
2. Anything lawfully made abroad may be imported and
resold in the US
a. Kirtsaeng v John Wiley & Sons
3. Still applies to books that were not lawfully made
elsewhere
iv. Exceptions- first sale does not apply to electronically
transmitted copies
11. Public performance & display rights
a. General
i. If it moves it is performance
ii. If it doesn’t it is display
iii. Analysis
1. Is it a public? how many people are there?
b. Performance
i. No PGS, no architecture, no sound recording
ii. Multiple performance- transmitter is performing, person
playing in their tv is performing
c. Display
i. Applies to all except motion picture, sound recordings &
architectural
ii. Can’t display may than 1 image at a time
iii. Must be only shown at the same location where the display
occurs
d. Public
i. To perform
1. In a place open to the public
2. A place where a substantial number of people outside of
a normal circle of family and friends gathers
ii. To transmit to any of the areas above whether members of the
public are capable of receiving it in the same place or in
separate places and at the same time or at different times
1. Ex) American Broadcasting Co v Aero- broadcasting tv
over the internet was violation because people were
capable of viewing at same time
12. Infringement
a. Direct
i. P must prove:
1. Ownership and validity of a copyright, &
a. Can do that by registering the copyright
2. Infringement of an exclusive right by the D
a. Copying and improper appropriation
ii. Direct evidence or circumstantial evidence of copying:
1. Access AND
a. Inverse ration rule- the greater the access the
less similarity needed; the greater the similarity
the less access needed
i. Still a minimum degree of similarity that
is needed
b. If the work is widespread there is more
likelihood of access and subconscious copying
i. Arnstein v Porter- P says that songs were
stolen from his room, but this is not
sufficient for access
2. Probative similarity – this is the similarity that tends
to prove actual copying
a. Compare all elements of the works
b. Call experts to testify about this
3. If there is direct evidence of copying you don’t need
either of these
iii. Improper appropriation
1. Substantial similarity- this is the similarity that shows
the copying was improper
a. Compare only the copyrightable elements
b. Quantitative and qualitative analysis
c. Separate out the non-copyrightable elements
(abstraction, filtration)
d. Look at this from the view of the ordinary
observer (lay person)
e. Ex) Nichols v Universal Pictures Corp- 2 plays
about irish and jewish marriage were not
substantially similar because the elements that
were the same were no the copyrightable
elements, and an ordinary observer would not
find them to be substantially similar
b. Indirect
i. General
1. No secondary liability if the product is capable of
substantial non-infringing use
a. Sony Corp v Universal City Studios- there was no
indirect infringement for the VCR because there
was no control and the item was capable
substantial non-infringing use
2. Still must have actual infringement
3. Policy- can’t get all the small fish so they go after the
one big one
ii. Two types
1. Vicarious liability
a. Factors:
i. Right of supervision/ control over the
premises
ii. Obtains a direct financial benefit
b. Control
i. Must be able to eliminate the infringing
activity
1. Perfect 10 v Amazon
2. Contributory liability
a. Factors:
i. Knowledge of the infringing activity, and
ii. Induces, causes or materially contributes
to the infringing conduct
b. Inducement
i. Factors to consider (Grokster):
1. Promotion of the infringement-
enabling virtues of the device
2. Failure to filter out infringing uses
3. Business depends on a high
volume of infringement
ii. When there is inducement Sony’s capable
of substantial non-infringing doesn’t apply
1. Ex) Metro-Goldwyn-Mayer v
Grokster- sent out e-mails and
advertised for users that were shut
down by naptster to come over to
their serivce
13. Defenses to copyright infringement
a. Fair use
i. General
1. Codified in § 107
a. Use for purposes such as criticism, comment,
news reporting, teaching, scholarship, or
research is not an infringement of the copyright
2. Judicial basis
a. Ex) Folsom v Marsh- citing portions of George
Washington’s letters was not fair use because it
took the heart of the letter and replaced the
market for the letter
ii. Factors to consider:
1. Transformative
a. the use is more likely to be fair if it is
transformative
b. Factors considered:
i. Is it a new work?
1. transformative when something
new has been created by adding
new expression to the original
work
ii. It is in the same market?
1. transformative when the work
serves a new and different
function and is not a substitute for
the original
iii. Does it have the same meaning?
iv. Is it expressing or commenting on
something else?
2. Purpose and character of the use
a. Commercial or non-commercial
i. Ex) American Geophysical Union v Texaco-
ii. In non-commercial must show that the
particular use is harmful, or that should it
become widespread there is a likelihood
that is would negatively impact the
potential market
b. Is it for one of the listed purposes or something
similar
3. Nature of copyrighted work
a. Creative or not creative?
i. Facts benefit the public and thus should
be more freely disseminated
b. Published or not?
i. Less likely to be fair if it is a use of an
unpublished work
ii. Harper & Row v Nation Ent- paper gets a
copy of a biography of president ford that
is to be published but has not been and
makes commentary while copying
portions of the language
4. The amount and substantiality of the portion used
a. This looks at both the quantity and quality of the
portion taken
i. Should not take more than is necessary
ii. Looks to see if it takes the heart of the
work
1. Ex) Harper & Row v Nation
Enterprises- the presidents
expression and point of view is
what made the work of interest so
taking the heart is replaces the
market
5. The effect of the use upon the potential market for or
value of the copyrighted work
a. Does is usurp the market by replacing the
original?
b. Does it effect the potential market for derivative
works?
iii. Special types
1. Parody (market failure and criticism)
a. Must hold the work up to ridicule
i. Merely using the work as a pun is a satire
and is not protected
b. Factor application:
i. Transformative- has the commenter
transformed the work into something
new
ii. Purpose- to comment on original
iii. Nature- not a telling factor because you
wont create parody of something that is
not creative
iv. Amount taken- no mare is needed, but
may take heart as to get people to
recognize the comparison to the original
v. Market- does it effect the market for
derivative or the original
c. Ex) Campbell v Acuff-Rose Music- the rap version
of “oh pretty woman” was a parody of the
original, but may have had effects on derivative
market
2. Reverse engineering
a. Reverse engineering focuses on the end product
and not the intermediary product
i. If arguing for the party who was taken
focus on intermediary as it is always
copied
ii. Factor application
3. Time Shifting
a. Time shifting is fair use
i. Sony Corp v Universal- Betamax is used to
record tv programs
b. Other ways to attack the copyright that may be seen as defenses
i. Function/ Useful,
14. Remedy
a. Injunction- no registration required
i. Preliminary
1. Looks at the same balancing test and also factors in
likelihood of success in the case
ii. Final
1. Balancing test for injunctive relief (eBay v
MercExchange test)
a. Irreparable injury
b. Damages inadequate to compensate
c. Under balance of hardships, equitable remedy
warranted
d. Public interest would be served
b. Damages
i. Actual Damages and profits- no registration requirement
1. Plaintiff must prove Ds gross revenue and then
defendant has the burden to prove how that amount
should be reduced
a. Expenses- must prove the amount of expenses
that should be subtracted from gross profit
b. Apportionment- Profits attributable to
something other than infringement