INTELLECTURAL PROPERTY (IP) CHECKLIST
It is important to develop, monitor and monetize your business’ intellectual property. Many times, it becomes its largest asset.
In dealing with companies, we find the following events are the necessary times to check in on your intellectual property, making sure that it is registered and protected.
Buynak Law operates a Business Compliance Program in which we review businesses (LLCs, Corporations, etc.) on a yearly basis. Reviewing the status of an entity’s intellectual property is part of that review.
Formation of your entity for ownership of the IP
Funding and Reserves (should include IP costs/fees)
IP Planning (copyrights, patents, trademarks, trade secrets, etc.) to have a plan for investors and financial institutions
Clearance Letter (before operating use, offerings)
Availability of intellectual property protection (e.g., trademarks)
Anticipated Investors/Loans concerning IP
Cease and Desist Letters (offering, operational start up)
Assignments of IP
Employees, Independent Contractors, Developers, etc. (naming the proper IP owner is important)
Sale in All or Part of the Business (merger, acquisition)
Sales of IP
DO NOT DEFER – your IP rights MAY be forfeited if not protected!
The California Consumer Privacy Act of 2018 (CCPA) secured privacy rights for California consumers as of January 1, 2020. The courts are starting to adjudicate legal cases, mainly class actions, as the CCPA provides a private right of action to “any consumer who has nonencrypted and nonredacted personal information… or whose email address is subject to a unauthorized access and infiltration, theft or disclosure as a result of the business’s violation of the duty to implement and maintain reasonable security procedures and practices appropriate to the nature of the information.”
The CCPA secures privacy rights for California consumers, including:
•The right to know personal information a business collects about the consumer and how it is shared and used;
•The right to delete personal information that a business collects about the consumer;
•The right to opt-out of the sale of one’s personal information; and
•The right to non-discrimination in exercising one’s CCPA rights.
To enforce these rights, businesses can expect lawsuits, especially class-action suits, for infringement of these rights. Particularly, there are statutory (automatic) damages “in amounts not less than One Hundred Dollars ($100) and not greater than Seven Hundred Fifty Dollars ($750) per consumer per incident or actual damages, whichever is greater”.
•If a data breach occurs, take immediate action as required by statute to notify consumers and to stop the activities underlining the breach through which data is being collected.
“Standing” to bring a case for data breaches under the CCPA is the current line of defense. In order to succeed in litigation; there is a need for damages and the Ninth Circuit Court of Appeals (the Federal court for our area) has issued decisions to indicate when a plaintiff has “standing” to proceed with a lawsuit under the CCPA. These cases are Krottner v. Starbucks, 628 Fed 3rd 1139 and more recently, Ree v. Zappos.com, Inc., 888 Fed 3rd 120. For data-breach standing, Zappos.com held that that occurs when (1) there is theft by outside hackers, (2) of highly sensitive personal information, (3) leading to the misuse of at least some named plaintiff’s personal information.
In evaluating this criteria, the recent case of Arifur Rahman v. Marriott, the California Central District Federal Court in Los Angeles, recently determined that the complainants “had not plausibly pled here that any of their more sensitive data… such as credit card information, passports, social security numbers… has fallen into the wrong hands. Without a breach of this type of sensitive information, plaintiff has not suffered an injury in fact and cannot meet the constitutional requirement of standing.”
TRADEMARK INFRINGEMENT (IP) – DON’T USE SOMEONE’S TRADEMARK; MISTAKES ARE COSTLY; YOUR PROFIT IS THE TRADEMARK OWNER’S GAIN.
The U.S. Supreme Court just made it easier for a trademark owner to recover damages (including your profits) against an infringer. The past standard of “willful” use or infringement is NOT necessary; all that is necessary is that the infringement occurred and then it is up to the adjudicator as to the level of damages, including the possibility of treble damages. Damages include your profits, as those same sales/income should have gone to the trademark owner. When you start a business or use of trademark, logo, slogan, etc., check whatever you are going to use with the United States Patent & Trademark Office on their website or have us do the same. Don’t make a very costly mistake. If you are a trademark owner, it is still good practice to send a “cease & desist” letter as that might resolve the problem or if litigation is necessary, it will increase your damages. A “cease & desist” letter should be very thorough, including the requirement of certification under oath by the infringer that they have ceased use of the infringing slogan, logo, etc. and that all products carrying it have been destroyed.