To NDA or Not to NDA

    Beverly A. Berneman

    The New York Times Small Business Blog published an article about the fate of non-disclosure agreements (“NDA”) for emerging and seed companies (Why More Start-Ups Are Sharing Ideas Without Legal Protection, New York Times, July 2, 2014). The article makes it appear that initial stage companies shouldn’t bother with a written NDA. This is dangerous advice. Sharing ideas without some protection could put an entire business model at risk. The article has some good suggestions like (a) make sure you have something to protect and (b) know your audience. But the article also suggests filing a provisional patent. The problem is that not every great idea is patentable. The article also doesn’t cover a critical issue which is how a lack of confidentiality would destroy protection for your trade secret.

    TAKE AWAY: Keep in mind that articles like this are giving general advice. The writer doesn’t know your business. If you’re shopping an idea around to potential investors, vendors and customers, you need to protect it. Always have an NDA on hand. If you get push back, then at least tell the other side that you have an expectation of confidentiality and confirm it in writing later. If you don’t have an NDA or they won’t agree to respect your expectation of confidentiality, then only disclose the high concept. Then tell them you can’t say more without an NDA. If you still get push-back, then you need to consider how valuable this relationship is going to be. Does the benefit of the potential business relationship outweigh the detriment of losing legal protection for your great idea?


    Fair Use Doesn’t Mean Every Use

    Beverly A. Berneman

    Two Federal Appellate Courts are duking out whether putting your own spin on someone else’s copyrighted work is enough for a fair use defense. The Copyright Act gives us four factors to look at for fair use: (1) the purpose of the use; (2) the nature of the work; (3) how much of the work is used; and (4) the effect the use has on the market for the original work.

    The Second Circuit Court of Appeals says that any transformative use of a copyrighted work is fair use (Cariou v. Prince). I've included a comparison of one of Cariou's original photos and Prince's changes to the photo. Do you think the second photo is fair use of the first?

    The Seventh Circuit Court of Appeals thought the Second Circuit went too far in hinging everything on transformative use. In a more recent case, the Seventh Circuit says that fair use isn’t designed to ‘protect lazy appropriators’ (Kleintz v. Sconnie Nation LLC).

    So you shouldn't let transformative use trump all of the other factors.

    TAKE AWAY: Here’s a quick quiz:

    1. Can you use a photo you got from Google Images on your website?
    2. Can you quote someone else’s book?
    3. Can you use a movie clip you got from YouTube in your PowerPoint presentation?
    4. Can you copy your competitor’s catalogue but change the name of the company and the contact information?

    Answers: (1) Probably not. Just because it’s on the Internet doesn’t mean it’s free. If you’re using it on your website, you’re making commercial use of someone else’s work without their permission; (2) Probably. It will depend on what you’re using it for and how much you’re using; (3) Maybe or maybe not. It will depend on what you’re using it for and how much you’re using; and (4) No.

    As you can see, the answers aren’t always easy. If you’re serious about using someone else’s images, photos, content etc., it’s worth getting a right to use opinion.


    What is the McLikelihood of McConfusion Anyway?

    Beverly A. Berneman

    McDonalds Corporation won a victory before the Trademark Trial and Appeal Board (TTAB) against a food company named McSweet LLC. McSweet wanted to register its name for pickled vegetables. McSweet argued that the mark was a play on the company founder’s name, Leo McIntyre. The TTAB rejected the argument. It held the public is likely to associate “McSweet” with McDonald’s family of “Mc” marks. The TTAB also rejected McSweet’s argument that no one would be confused between fast food and pickles.

    TAKE AWAY: Trademark law protects the consuming public from a likelihood of confusion about the source of products and services they buy, use or consume. This case is a good example of a likelihood of confusion. If you saw “McSweet” on a grocery shelf, you’d probably think that McDonald’s is selling the warm pickles they put on their burgers. This case also points out that a trademark protects not only the specific goods and services associated with the mark, but any overlapping goods or services. Food is food.


    Welcome to IP News for Your Business

    Beverly A. Berneman

    Intellectual Property. Patents, copyrights, trademarks, trade secrets, domain name, right of publicity! I know what you’re thinking. What do these things have to do with my business? This blog is going to answer that question. In short bites, I want to let you know what’s going on in the legal world around Intellectual Property. For an Intellectual Property geek like myself, that can be enough. But, I’m going to take it one step further. I’m going to give you a TAKE AWAY that shows how this news helps your protect your business and make it more productive. My posts will be relevant to your business whether your revenues are $500,000 a year or $5 million a year.

    But first, a little about myself. I’m attorney who practices primarily in the area of Intellectual Property. I hold a legal masters in Intellectual Property and also teach at John Mashall Law School in Chicago. Over the years, I have found that an informed client is the best client. A well informed client can make better decisions about their business in the short term and long term. In order to promote that, I started a column in my firm’s quarterly newsletter that has now evolved into this blog. I look forward to sharing information with you.

    Interested? Read on. I've posted a few starter items for you.