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Los Angeles Business Law Blog

Should your business use a patent or trade secret?

For many businesses, intellectual property is their most important asset. It is the one thing that separates the company from all others, and it can allow any business to remain competitive. It is for this reason that any business with intellectual property must go to great lengths to protect it in the form of either a patent or a trade secret. 

There are substantial differences between these two concepts. As a business owner, you must weigh the pros and cons of each one so that you can make an informed decision regarding your business. The right decision can help your business thrive for years to come. 

Insurance policies may exclude trademark infringement defense

Businesses in California may want to pay close attention to their insurance coverage, especially if they will be dealing with intellectual property issues. This is illustrated in one case where a company sought coverage from their insurer for a lawsuit that accused the firm of infringing a trademark. However, the insurance company said that its policy did not provide coverage for intellectual property disputes, disclaiming its responsibility to defend the case. The company's case was dismissed after the insurance company demonstrated exclusions in its business liability and technology policies that addressed trademark infringement cases.

The company claimed that it was entitled to receive coverage for its legal defense under its coverage for personal and advertising injury. The description of this listed eight different situations, including alleged copying of an advertisement. However, an endorsement on the company's policy excluded nearly all of the eight different allegations, including copying in advertising and associated trademark infringement. In addition, the company also sought to use its technology policy to obtain coverage. However, the court accepted the insurer's argument that this policy covered technology services provided to others and excluded all intellectual property claims.

How to keep trade secrets protected

Companies in California and throughout the nation most likely have trade secrets that they need to protect. This can be done in a variety of ways including telling employees what they can and cannot share with others. Furthermore, the consequences for sharing protected information should be made clear in an employment contract. In the event that trade secret rights are violated, a company should take legal action quickly.

To minimize the chances that information is shared inappropriately, only certain people should have access to it. For instance, access to computer code should only be shared with key engineers or key members of the IT department. It may be a good idea to have a manager who is responsible for determining who gets to handle trade secret iformation, and when. He or she would also be responsible for creating a chain of custody logs and other security measures needed to protect vital information.

Guns N' Roses suing brewery for trademark infringement

California-based band Guns N' Roses is suing a brewery in Colorado over a menu item that bears the name "Guns N' Rosé" ale. The band claims the name the establishment is using for its ale creates the false impression that they are somehow associated with it. The brewery at the center of the matter attempted to trademark the name for its product in 2018, which is what ultimately attracted the band's attention.

The trademark infringement litigation related to this matter was initiated after the brewery was contacted by the band's manager. The business subsequently withdrew their trademark application. However, they continued to sell the rosé ale. The brewery also sells merchandise with the name that's similar to the one that's been used by the band for more than 30 years.

3 aspects of California's overtime laws

A business owner has to understand some basics about how labor laws work. Not taking the time to speak to someone who can educate you on such laws may result in a rash of lawsuits or even a company shutdown.

One of the most crucial elements of business ownership is understanding wage and hour laws, especially when it comes to overtime. Knowing how much you have to pay employees is integral to staying up and running. Keep these three essential facets of California's overtime laws in mind to avoid getting in trouble.

California businesses must protect their intellectual property

The past decade has seen a growing trend of companies in California and elsewhere buying up patents that were sitting on the shelf because they were not worth commercializing. In some cases, companies purchased such patents en masse for the sole purpose of litigating patent infringement cases against businesses that produced goods or services resembling a feature in one of the patents. In many cases, the lawsuits were directed at tech companies who began to buy up such patents themselves as defense mechanisms.

Acquiring these so-called troll patents has proven to be a gold mine for many of the patent purchasers. However, the frivolous patent lawsuits are erasing as much as $60 billion in firm wealth each year, according to a study by Harvard Business Review. The Obama Administration attempted to fix the problem by working with Congress to pass legislation aimed at reducing such patent lawsuits. However, the patent trolls simply changed their business model to go after trade secrets.

Horse-racing announcer sues over trademark infringement in movie

Making a film in California sometimes results in some unexpected surprises, such as legal action. This is what's happening with a 2014 Bill Murray movie. A horse-racing announcer is suing the film's production company over what he claims is trademark infringement. The case centers around the phrase "And down the stretch they come!" which the announcer first used in the 1960s. It later became a well-known phrase when he used it during horse races shown on broadcast TV in the 1970s.

Inspired by what another announcer did with the iconic phrase "Let's get ready to rumble," the horse-racing announcer trademarked his popular phrase in 2012. The trademark infringement suit involves the unauthorized use of the phrase in a movie that has Bill Murray playing a retired, grumpy alcoholic who bets on horses. The lawsuit claims that the utterance of "And down the stretch they come!" by the unsavory character Murray plays in film tarnishes and damages the reputation of the announcer who owns the trademark for that phrase.

A claim involving BMW and trademark infringement

California brand owners may be interested in learning about a case involving car manufacturer BMW and a telecommunications company that registered with the same initials in its company name. This is something that is of particular interest to those with brands that are well-known around across the nation and around the world.

BMW issued the High Court in order to seek injunctions and declarations against the owner of the telecommunications company. The car manufacturer took this action even though the telecommunications company changed its name. Manufacturer executives felt that including these initials would misrepresent them. The auto manufacturer uses its trademark name for services and goods, including telecommunications. BMW used this to support their claim of trademark infringement.

Trademark infringement is on the rise

It's not unusual for California business owners to want to have something truly unique about their brand that's also legally protected. The World Intellectual Property Organization reports that the number of trademark application filings has spiked considerably. In 2017 alone, applications jumped 30 percent over the previous year. Because of the rise of trademark application filings, there is greater need to be diligent about screening, clearing, registering and watching trademarks.

Even with many brands being more cautious, infringement is on the rise. Any type of trademark infringement litigation has the potential to be devastating for a business, especially if a significant investment has already been made. A leading trademark research and brand protection firm conducted a survey in which 81 percent of respondents reported experiencing instances of infringement within the past year, a 10 percent increase from a survey conducted for the same purposes the year prior.

How to deal with sexual harassment claims as a business owner

Owning a business is hard work and can result in a high amount of stress. One of the greatest sources of stress is employee relations and how people get along with each other.

When one employee accuses another of sexual harassment, do you know how to deal with it? As a business owner, you set the tone for how the proceedings will go.

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