The holiday season is upon us, therefore, it only is appropriate for your friendly intellectual property law attorneys to remind you that while everyone may be taking things more slowly than normal and putting what they feel is not important “on the back burner,” you may not want to relax if you are dealing with certain areas of intellectual property law, namely patent law.  In U.S. patent law, there are strict statutory time limits regarding how long an inventor can disclose, sell or offer for sale an invention before he or she loses rights to patent the invention.

According to 35 U.S.C. §102(b): “A person shall be entitled to a patent unless … the invention was patented or described in a printed publication in this or a foreign country or in public use or on sale in this country, more than one year prior to the date of the application for patent in the United States.”  This means that an inventor will not be entitled to a patent if the invention was patented more than a year before the inventor filed a patent.  The inventor will not be entitled to a patent if the invention was described in a printed publication (magazine, journal, book, internet website, brochure, published patent application, etc.) whether the printed publication was in the U.S. or another country more than a year before the date of filing for a patent. The inventor will also not be allowed to obtain a patent if the invention was used in public in the United States (whether at a trade show, by members of the inventor’s family or other uses) more than a year before the inventor filed for a patent.  Finally, the inventor will not be allowed to obtain a patent on the invention if the inventor sold or offered the invention for sale in the United States more than a year before the application for a patent was filed. 

For example, if you invented a new type of outdoor decorative lights and offered your lights to Target^® for sale on December 4, 2008, you would have until December 4, 2009 to file an application for a patent for your invention.  If you attempt to file an application for a patent after December 4, 2009, you will not be allowed to get a valid patent for that invention.  It does not matter whether or not you actually sold the lights to Target^®, the offer for sale is enough.  However, if you were to go on vacation in Canada and offer your invention for sale, or sell your invention to a business in Canada on December 4, 2008, you would not be limited by §102(b) because you did not offer your goods for sale in the United States. 

During this holiday season, if you have invented something, give yourself the greatest gift: protection of your invention.  Consider the statutory time limits and do not let something as important as your invention “sit on the back burner” while you relax in front of a warm fire with your family and friends.

Laurie Young                (612) 392-7309           Laurie.Young@nm-iplaw.com

On Nov. 16, 2009 the U.S. Supreme Court denied cert. in the Harjo v. Pro-Football, Inc. case.  This finally brings an end to the debate about whether the Redskins have an offensive trademark for their football team.   The Supreme Court did not provide any comments regarding its decision to not hear this case.

The case started out in 1992 as a petition by Suzan Harjo on behalf of herself and several other Native Americans to the United States Trademark Trial and Appeal Board to cancel the trademark registrations which were granted to the Washington Redskins Football team in 1967.  Harjo, et al. believed the “Redskins” trademark violated Section 2(a) of the Lanham Act because it was a mark that comprised “immoral, deceptive or scandalous matter; or matter which may disparage or falsely suggest a connection with persons living or dead, institutions, beliefs or national symbols, or bring them into contempt, or disrepute.”  In 1999 the TTAB ruled in favor of Harjo, et al, but Pro-Football appealed (smartly, in my opinion) to the U.S. District Court for the District of Columbia (they had the option to appeal to the Court of Appeals for the Federal Circuit).  The District Court found in favor of Pro-Football.

This case has been in the courts since 1999 primarily about an equitable doctrine called Laches.  The Courts have now all agreed that the Harjo et al. delayed too long in bringing the case, since all of the plaintiffs in the action were alive when the mark was filed with the Trademark Office (1967), but they did not bring the case until 1992, twenty five years after the Redskins mark had been registered.

Laurie Young                (612) 392-7309           Laurie.Young@nm-iplaw.com

We are pleased to announce Jim Paige has been promoted to First Lieutenant in the Minnesota Army National Guard’s JAG Corp.  In this role Jim will advise soldiers in the Minnesota Army National Guard.  We congratulate Jim on this honor.

Jim Nikolai        (612) 392-7302              Jim.Nikolai@nm-iplaw.com

Banks, venture capitalists and other lending institutions often require borrowers to pledge their intellectual property (patents, trademarks, copyrighted matters) as collateral for a loan.  Before the lender is in a position to foreclose on such collateral and assert a priority position in a bankruptcy proceeding, it is essential that the lender has properly “perfected” its security interest in the borrower’s IP.  Failure to properly perfect the security interest leaves the lender no better off than an unsecured creditor.

To “perfect” a security interest, the secured party (the lender) must provide public notice of the existence of such interest by filing a lien notice with the applicable local, state or federal agency.  The applicable jurisdiction and law depends upon the type of intellectual property involved.

As a general rule, a lender’s security in “general intangibles” (which includes IP) is perfected not only by filing the notice but also by the filing of a so-called U.C.C.-1 Financing Statement.  Under the Uniform Commercial Code, a set of uniform laws enacted in all 50 states governing the conduct of business, the filing of a U.C.C.-1 Financing Statement creates a lien against the property so the borrower may not dispose of the property without paying the debt.  The lender typically files the document with the Secretary of State’s Office where the borrower’s principal place of business is located or in the applicable County Clerk’s Office.  It is wise for a lender to file in both as a matter of safe practice.

A question often arises as to whether it is necessary to record a lien in the U.S. Patent and Trademark Office in order to perfect the security interest against patents.  The patent assignment provisions of the patent laws do not specifically address the issue of perfection of security interests in patents.  Prior to the adoption of the U.C.C., perfection of a security interest in patents did require recordation of such liens in the U.S. Patent and Trademark Office (USPTO).  Subsequently, however, several jurisdictions have specifically held that filing of a U.C.C.-1 Statement under state law is sufficient, but the law remains somewhat unsettled.  Accordingly, dual filings by lenders under the applicable U.C.C. provisions and with the USPTO are recommended. 

Concerning trademarks, which are governed by both federal and state regulations, a lender should record its security interest with the USPTO.  Such a recording may be necessary to prevent a subsequent bona fide purchaser from acquiring rights to the trademark.  Some federal courts have held that nothing in the Lanham Act covering trademarks preempts state law as far as perfecting security interests in trademarks is concerned and, therefore, again it is recommended that both a U.C.C. filing and a recording of a security interest in a trademark with the USPTO be undertaken by the lender.  Because a trademark cannot subsist separate from the goodwill of the business with which the mark is associated, special care must be exercised in drafting the U.C.C.-1 Statement where trademarks and/or service marks are to serve as loan collateral.

With respect to copyrights, the law is quite clear that security interests in federally registered copyrights can only be achieved by recordation of that security interest with the U.S. Copyright Office.  Specifically, a U.C.C. filing is insufficient to perfect the lien.  In the case of unregistered copyrights, the lender should insist that registration of the copyright take place and that the security interest in that registered copyright be recorded with the U.S. Copyright Office.

Attorneys at Nikolai & Mersereau, P.A. are knowledgeable in this area and are in a position to handle the perfecting of security interests in IP.

Tom Nikolai                 (612) 392-7307           Tom.Nikolai@nm-iplaw.com

We are pleased to announce that Laurie Young, our second year associate, has been elected to be the next vice-chair of the Hennepin County Bar Association, New Lawyers’ Section.  In this role, Laurie will be supporting the chair and learning all of the responsibilities of being the chair of the HCBA New Lawyers’ Section.  Laurie will also sit on the executive committee of the Hennepin County Bar Association.  We congratulate Laurie for being elected to this position. 

Jim Nikolai       (612) 392-7302           Jim.Nikolai@nm-iplaw.com