In-House Counsel Solutions
This is the 2Q installment of our In-House Counsel Solutions Series. The series is focused on identifying trending legal issues facing in-house counsel and providing practical solutions to these problems.
In this issue, we discuss the increasing importance of import tariffs and the need to review supplier contracts, the benefits of dual protection for logos, and a recent trademark case where Pepperdine sued Warner Bros. We also discuss securing copyright ownership in employee-created works and work-for-hire agreements.
Here Come The Tariffs: Tips for In-House Counsel Reviewing Contracts
By Mark Stachiw
The current international trade landscape is becoming increasingly complex with the rise of significant new import tariffs, making it essential for companies to review their contracts with suppliers and customers to understand who bears the burden of these additional costs. In-house counsel should examine several key provisions in their supplier and customer contracts, including force majeure, tax provisions, pricing clauses, delivery and title and risk of loss provisions, customs provisions, term and termination provisions, and product provisions.
A careful review is necessary as certain clauses, like force majeure—depending on the language, may not excuse non-performance due to tariff increases, and tax provisions may not explicitly address tariffs. Additionally, pricing and delivery provisions can impact who is responsible for tariffs, particularly if goods are delivered outside the country of ultimate sale. By thoroughly reviewing these provisions, companies can minimize potential risks and costs associated with tariffs and better navigate the complex trade environment.
For a further discussion of the relevant provisions and what one should consider in the review, visit our Ideate blog: Here Come The Tariffs: Tips for In-House Counsel Reviewing Contracts.
Logo and Copyright: Why You Should Consider Copyright Registration in Addition to Trademark Registration
Most often, businesses elect to seek trademark registration under the federal Lanham Act, 15 U.S.C. § 1051, or under equivalent state law, to protect their logos and other trademarks. As discussed below, federal registration provides a number of valuable advantages over unregistered trademarks sometimes referred to as "common law marks." So why additionally protect a logo with a copyright registration? The answers are found in the differences between what trademark law and copyright law protect as well as significant differences in the forms of relief available under each statute. If a logo meets the standard for copyright registration, dual protection under both statutes may make sense.
Trademark law protects the source identifier – words, slogans, images, and even colors – of goods or services against others whose conduct may result in a likelihood of confusion in the marketplace. Many businesses invest in trademarking their core brands and logos because a federal trademark registration provides several advantages.
Copyright protects the creative expression of an idea, not the idea itself. As the U.S. Supreme Court ruled in the famous Feist case, only a "spark" of creativity is required to obtain a copyright. However, not all logos may be substantive enough to qualify for copyright protection even under the low standard of Feist. To be copyrightable, a logo must also be sufficiently an independent creation under copyright law to qualify for protection. Seeking a copyright on the work of others is not likely to be successful.
For a more comprehensive discussion on dual registration, visit our Ideate blog: Logo and Copyright: Why You Should Consider Copyright Registration in Addition to Trademark Registration.
When the First Amendment Intersects with the Lanham Act for Trademark Protections
Traditionally, product or brand-placement within a television series or movie—think Spielberg's E.T. and Reese's Pieces® candies—requires a license or other agreement with the brand (and often, payment of a license fee) to avoid legal issues arising out of trademark infringement. But that's not always the case. As Pepperdine and Duke University have learned in recent months, the intersection of the First Amendment with the Lanham Act is a completely different matter.
Recently, both Pepperdine University and Duke University have complained of unauthorized use of their registered trademark in a television series; Pepperdine filed suit while Duke was still evaluating its next step. And although the marks at issue are very similar or even identical to the federal registrations and are used in a similar context, in the Pepperdine lawsuit the district judge denied a temporary restraining order. So, what's the holdup? It's the Rogers test that applies when the First Amendment intersects with the Lanham Act.
A comprehensive discussion on the intersection of the First Amendment with the Lanham Act can be found at our Ideate blog: When the First Amendment Intersects with the Lanham Act for Trademark Protections.
Copyright Ownership Problems: Are You Sure You Own Your Copyrights?
By Brian Casper
Identifying a businesses' core intellectual property is not always as easy as it should be. Copyrights are a right often neglected by businesses until it's too late to secure them for some very practical reasons that result from how they are created in the first place. A copyright (that is, the right to copy) is secured the instant the expression of something is made tangible. In other words, the copyright to a photograph exists the moment the photographer snaps the picture; a story or song is copyrighted as soon as it is written down; and an illustration is copyrighted as soon as it is illustrated.
The initial owner of the copyright is the person (a human) who created the content, or in some cases the company who employed that person to create the content. The key word here is employed—and this is different than hired or contracted. It is the traditional relationship between an employee and employer that can potentially convey the copyright to the employer rather than the individual who created the work. But this automatic vesting of the copyright in the employer has several requirements. First, as mentioned above, there has to be the traditional agency relationship between employee and employer and creating that content has to be "within the scope of his or her employment." 17 USC § 101. Second, if there is not an employee/employer relationship, then there needs to be an agreement signed by both parties stating that the work will be considered a "work made for hire." However, in this second category, there are only nine types of works that are eligible for consideration as a work for hire even if the parties agree.
A typical way we see this causing problems is when a business hires an independent contractor or other company to create content for them, or when valuable content that was originally created by the owner or founder of a company (who was not an "employee") and the company was later sold.
Tracking down ownership is merely one of the issues that needs to be clarified in order to register a company's copyrights. If you have content you need to secure with a copyright, we have a helpful intake form available as a free download on our website to get you started. If you have any questions, please contact one of our experienced attorneys to assist you.
A comprehensive discussion on copyright ownership problems can be found at our Ideate blog: Copyright Ownership Problems: Are You Sure You Own Your Copyrights?
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
