Legal Issues For THE Entrepreneur

LEGAL ISSUES FOR
THE
ENTREPRENEUR
What will we
learn?
• Intellectual Property
Rights
• Patents
• Trademarks
• Copyrights
• Trade Secrets
• Licensing
• Product Safety & Liability
• Insurance
• Contracts
INTELLECTUAL
PROPERTY
• Any Innovation, Commercial or Artistic,
or any Unique Name, Symbol, Logo or
Design
• IP is an Asset for the Entrepreneur
• It must be protected from Un-authorized
use.
• There are four ways to protect IP
1. Patents on Inventions
2. Trademarks on Branding Devices
3. Copyrights on Music, Videos, Patterns, Forms
of Expression
4. Trade Secrets for Methods/Formulas
P AT E N T
S
• A Contract Between Government &
Inventor in Exchange for disclosure of
Invention
• Grants the inventor EXCLUSIVITY to
Make, Use & Sell the Invention for
• Specified Amount of Time
• Territorial
• Holder Obtains MONOPOLY for certain
period and after that it passes into Public
Domain
• Patents can be obtained in widely varying
Technical Subject Matters - "almost
• Holds the Right to issue Licenses to Others
• An Idea/Thought can not be Patented
• Modifications in Existing Products can also
be Patented
• Term of Protection should be a minimum of
20 Years
UTILITY
PATENTS
• Protect Useful Processes, Machines, Articles
of Manufacture, and Compositions of
Matter.
• Some Examples: Fiber Optics,
Computer Hardware etc
DESIGN
• GuardsPATENTS
the Unauthorized Use of New,
Original, and Ornamental designs for
Articles of Manufacture.
• The look of an Athletic Shoe, a Bicycle
Helmet, the Star Wars Characters are
all protected by Design Patents.
PLANT
PATENTS
• Are the way we Protect Invented
or Discovered plant varieties.
• For Example: Hybrid Tea Roses, Silver
Queen Corn, Better Boy Tomatoes are all
types of plant patents.
T R A D E MA R K
S
• Protects Words, Names, Symbols, Sounds, or
Colors that distinguish goods and services.
• Trademarks, unlike Patents, can be renewed
FORVER as long as they are being used in
business.
• The roar of the MGM lion, the pink of the
Owens-Corning insulation, and the shape of a
Coca-Cola bottle, The Original Lawn by Gul
Ahmed are familiar trademarks.
• Four Categories of TMs:
1. Coined/Fanciful Marks: The word doesn’t mean
anything until its related to the company’s (e.g.
Kodak, Moosa Jee)
2. Arbitrary Mark: Common Word used in
Meaningless Context (e.g. Apple, Dollar)
3. Suggestive Mark: suggests certain Features,
Qualities, Ingredients, or Characteristics of a
Product or Service (e.g. Microsoft)
4. It requires an imaginative leap to determine the
products and services to the mark refers.
5. Descriptive Mark: A mark that immediately and
directly connects to a particular product (e.g.
Clock)
CO P Y R I G H T
S
• Protects Works of Authorship, such as
WRITINGS, MUSIC, and WORKS OF ART
that have been Tangibly Expressed.
• Stop others from Printing, Copying,
or Publishing
• Does not protect Idea itself, others can
use Idea/Concept in a Different manner
• Term of Copyrights is the life of Author
plus 50 Years & 75 Years for an Institute.
• For Example: Gone With The Wind, Harry
Potter (the book and the film), Beatles
Recordings, Computer Software, and
Video Games.
• Books, Scripts, Articles, Poems, Songs,

Sculptures, Models, Maps, Blueprints,
Collages, Printed Material, Data & Music
all can be Copyrighted.
TRADE
•
SECRETS
Are information that companies keep
secret from Public/Competitors to give
them an advantage over their
competitors.
• The formula for Coca-Cola is the most
famous trade secret.
LI CEN SI N
G
• Arrangement between Two Parties i.e. Proprietary
Right Owner/Patentee and the Licensee
• The patent owner may give permission to, or
license, other parties to use the invention on
mutually agreed terms
• Licensee pays Royalty/Fees against the Right to use
IP
• Licensing is done to either Expand a Business or to
Start a New Venture.
• Inexperience or Lack Resources
• Licenses are Issued to make PROFITS and
REACH wider span of Public
• Patent License Agreement:
– Either just market a Product OR Manufacture and Sell Also
• Examples:
– Telecommunication Companies, Fuel Stations,
etc.
• Copyright License Agreement:
– Copy Books, Software, Music, Photographs, & Plays
etc
– Indian Idol, X-Factor.
• Examples:
PRODUCT SAFETY &
LIABILITY
• A Firm must NOT Breach any Legal
Specifications of a Product under the
CPSA(Consumer Product SafetyAct)
• Pre-Assessment to Check if the Product
is Subject to any Regulations under
CPSA
• Entrepreneur must follow the
Prescribed
Specification to meet the CPSA’s
requirement
• Examples:
– Toyota Motors Paid in all Million of Dollars
to their Customer, who had Accident in
2009
• Product Liability Claims Types:
1. Negligence: anywhere in Production
2. Warranty: A guarantee that seller gives
regarding the quality of product
3. Strict Liability: Defective Products for
Sale
4. Misrepresentation: Misleading
information
I N SU R A N C
E
• A cover against any unexpected Miss-hap
• Managing Risk in the New Business+
• Type of Insurance to Purchase depends upon the
Nature of Business/Industry.
For Example:
– Staff Safety is more of concern in Chemical Industry
than Banks
– International Marketing Personnel/Sales Managers
Travel more frequently than Financial Executives –
Need Company’s Insurance Coverage
CO N T R A CT
S
• Legally Binding Agreement between
Two Parties
• Entrepreneur’s Contract with
Vendors, Landlords, & Clients etc
• Written Contracts must be preferred
over Verbal Ones.
• Benefits of Written Contracts: termed
as Valid & Legally Enforceable
In case of Not Availing a Lawyer,
Entrepreneur must take care of following
essential items:
1. All Involved Parties shall be Named along
with their Roles (Buyer & Seller, Licensee
& Licensor etc)
2. Detailed Transaction (Exact Location,
Date, Time & Place of Delivery etc.)
3. Exact Value of Transaction
4. Involved Persons’ Signatures must
be Obtained in the Deal.

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LEGAL ISSUES FOR

• Books, Scripts, Articles, Poems, Songs,

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