Business Literacy Blog

BUSINESS ASSETS

Let’s talk about what your business owns. In addition to all the assets you can touch, such as your vehicles, machinery or equipment and your inventory, you own assets that you can’t touch (“intangible property”.) Examples of intangible property include your business’ goodwill and may also include intellectual property.

How can you make money off your intellectual property? There are indirect and direct ways. Indirectly, customer recognition of your company logo means they will seek out your brand and choose it over that of a competitor. You can sell or license your intellectual property to directly profit from it.

There are four kinds of intellectual property:

Patents

Copyrights

Trademarks

Trade secrets

Patents. The government gives the owner of a patent the exclusive right to make, use, or sell an invention for a limited time. The invention is publicly disclosed, but others cannot make, use or sell it without permission from the owner until the time frame expires. Most patents are utility patents; they are based on the usefulness of the invention. However, there are also design patents, in which the design itself is what is protected (think the shape of a bottle of Coca-Cola). Plant patents are also available. In order to obtain a patent, an invention must be useful (utility patents) or ornamental (design patents), novel, and non-obvious.

Copyrights. In order to claim a copyright, there must be a creative, original work. It must be expressed in a tangible format and cannot be just an idea. It must be fixed so you can see or hear it. What is protected under copyright law is the author’s rights in their original works of authorship, such as books, screenplays, productions, shows, music and art. The author of the work has the exclusive right to reproduce the work, to prepare derivative works, to distribute the work, and to publicly perform or display it.

Trademarks consist of words, names or symbols that are used in trade with goods or services. The words, names or symbols are associated with the source of the goods or services and distinguish the owner from its competitors.

Protection

In order to protect patents, copyrights and trademarks, some affirmative action must be taken. For patents and trademarks, the owner must apply for protection with United States Patent and Trademark Office. For copyrights, the owner must use the copyright symbol as well as the name of the owner and the year of copyright (© your name here 2018) and/or register the copyright. Registration is required in order to sue someone to prevent them from using the copyright.

Trade Secrets differ from other types of intellectual property because the focus is on keeping the secret, rather than sharing it with the public. Unlike other forms of intellectual property, there is no time limit on how long the secret can remain secret. However, once the secret is revealed, there is no protection. Therefore, it falls upon the owner to take measures to keep it secret. Some methods to maintain the secrecy and avoid risk include telling the secret to only those who need to know, keeping it in a safe place (encrypted, secure), requiring that employees, investors and others who may come in contact with the secret sign Non-Disclosure Agreements and/or Non-Compete Agreements. However, if a competitor develops the same secret independently, including through the use of reverse engineering, there is no protection for the original owner unless the competitor obtained the information through criminal or fraudulent means. In such case, the original owner may be entitled to an injunction to prevent the competitor from using the information and/or damages.

©2018 Nancy Beth Goren

Lessons for Commercial Landlords and Tenants

https://www.law.com/dailybusinessreview/2018/07/30/smoking-gun-email-helped-miami-attorneys-cinch-3-45-million-settlement-in-wrongful-death-suit/

This article reports on a multi-million dollar settlement that was reached after a tenant was killed in a fire. The smoking gun email referred to in the article showed that the landlord knew that there were fire code violations. From a legal perspective, the fact that the space was used for both commercial and residential tenants means that two standards apply. As a matter of law, the liability for those violations lay with the landlord as to the residential spaces. However, as to the commercial spaces, the leases may have assigned that responsibility to the tenants. Therefore, if commercial tenants were responsible for such maintenance and had been injured in the fire, it may be difficult to prove any liability on the part of the landlord, even though the landlord knew there were code violations. In such case, a commercial tenant would argue that the landlord had a duty to notify the commercial tenant of the existing violations. If they existed at the time the lease was executed, the commercial tenant could argue that the landlord fraudulently induced it to enter into the lease. If the landlord was notified about the violations during the term of the lease and failed to pass along the information to the tenant, then the landlord could also be held liable under a negligence theory.

What's the lesson for both landlords and tenants? Know what your obligations are, whether they are spelled out in your lease or not.

Watch your language! Your business deal can hinge on a comma.

Small business owners negotiate the price and delivery terms of their deals; they might spell out work scope or describe the goods they want. However, they frequently fail to check the language in the contract to make sure it reflect what they think is the deal. Even a comma can make a huge difference.

According to a July 23, 2018 article by Chris Stokel-Walker in BBC Online,

“(I)t’s important to carefully check any contracts we sign, the experts say – and that means not just dotting the Is and crossing the Ts but also making sure every comma is in the correct place.

People sign contracts not because they’ve negotiated their meanings, but based on their own understanding of what they’re agreeing to, explains Nobles. Contracts written by lawyers on behalf of a business might have a different meaning than what the lay person understands.”

http://www.bbc.com/capital/story/20180723-the-commas-that-cost-companies-millions