Intellectual Property: Trade Secrets, Copyrights And Trademarks

Many professionals have a lot of questions about protecting their materials and name. What they are concerned with is what we call ‘intellectual property’. Intellectual property can represent 70% of a company’s value, so it is important to not only understand it, but to also understand how best to protect it. This article will address what intellectual property is, explain each in a bit of detail, discuss how the Internet has impacted it, and how to protect it.

Intellectual Property – what it is
The definition of intellectual property is basically any knowledge, information or ideas that is important to a business for competitive success. Examples include a business name, a logo, a graphic, a tag line, advertising materials, product literature, software, an invention. Even such things as customer lists or vendor lists can be considered intellectual property.

Trade Secrets – keep it hidden!
A trade secret is any information, including a formula, pattern, compilation, program, device, method, technique, or process that provides a business with a competitive advantage that others don’t have access to. To qualify as a trade secret, the company/owner must take reasonable efforts to keep it secret. Sales and marketing plans can be considered trade secrets, as are computer files sales data. Probably the best example of a trade secret is the formula for Coca-Cola. For health and fitness professionals, a trade secret might be a particular bit of survey information that has helped them discover a need in the market that no one else has discovered, yet. This information must not be generally known to be considered a trade secret. However, once the professional has taken steps to market to that audience, as a result of the survey, it will no longer be a secret.

Another example of a trade secret might be a particular program for clients that are different than what others have ever created. It may be a particular workout, or a particular eating plan; some type of program or method that is unique and not generally known or discoverable by others.

Copyrights – do you really need them?
Of more importance to health and fitness professionals is the law of copyrights. Many clients ask me about this when they are creating handouts and the answer depends on how much you feel your materials need protection. Copyright law applies to pieces of work such as books, works of art, software, websites, musical recordings, magazines, plays, dramatic performances, and movies. An easy way to informally protect works is to include the “©” symbol, followed by the name of the author/publisher, the year of publication. You can also include the phrase, “All rights reserved”.

Copyright protection gives the original author exclusive legal rights to economic benefits from the work. They can reproduce copies, develop derivative works based on the original product, such as workshops, for example, distribute copies, perform it publicly, and display it publicly. Of most importance is that copyrighting the work prevents others from copying, distributing, performing or displaying the work without permission from the author/publisher.

Health and fitness professionals often ask if they can legally copy materials to give to their clients, and the answer is, “it depends”. Many educational materials will include the statement that they can be reproduced for educational purposes, and other materials will include a statement that as long as original author and contact information is included, materials can be copied and distributed. If a person is unsure, they should contact the author or publisher.

If you have educational material, should you go through the process of formally copyrighting it? Well, to decide this, you need to first determine if it qualifies. There are three basic requirements for copyright protection: 1) the work must be fixed in a tangible medium (written on paper, on a computer disc, or recorded on tape), 2) the work must be original, and 3) it must contain some bit of creativity. Legally, once a work has been fixed onto a tangible medium, it is copyrighted; a notice on the material is not even required! However, if the author wanted to prove infringement in court in the US, the owner of the copyright must have it registered with the Register of Copyrights, in Washington, DC. The process is simple and very affordable, so the author just needs to determine to what extent they need to protect their work.

Examples where just listing the copyright protection should be enough are educational handouts or any other similar materials for the education of clients. If a professional has created a particular of work that he would like to expand into workshops, or is something he would like to eventually license, it would probably be worthwhile to formally copyright. If you are unsure if your work should be copyrighted, it would be wise to consult with a copyright attorney, but it’s not necessary to use an attorney to apply for copyright protection. Books are definitely copyrighted, however, and the most recent court ruling on royalties due authors who publish their works on the internet indicates that authors who wish to be paid for such works should register, also.

Protecting your name with a trademark
Trademark protection is a huge business! Consider companies such as Nike with their ‘trademark’ swoosh, or the golden arches of McDonalds. A trademark is any word, phrase, name, symbol, sound or device that identifies and distinguishes one company’s products or services from another.

When you consider trademark protection, you can trademark just in your state or federally. It is generally recommended to go for the federal trademark, for wide protection, but then also file for state trademark while you wait through the federal process. Not all trademarks are eligible for federal registration, however, such as descriptive marks. If you are starting a company and have created a unique name that you would like to protect for years to come, it may be a strategy you wish to take. However, the process of obtaining a federal trademark can be complex and it is recommended to use an experienced attorney for the process. Examples of what you might want to trademark could also include a particular logo, tag line or phrase.

The internet
On the internet, domain names, which are website addresses, are given on a first-come, first-served basis. As a result, some people started to buy up domains of names that were trademarked by large companies and then tried to sell those domains to the companies for large amounts of money. There was no protection of trademarked names when it came to domain names. Anyone could use the domain name of Ford.com, for instance.

As a result, Congress passed the Anticybersquatting Consumer Protection Act of 1999 to make it illegal for a person to register a domain name, with bad-faith intent to profit from the name, if the domain is identical or very similar to a distinctive trademark or identical or similar to a famous trademark.

In order to properly protect your intellectual property, you should register or take specific steps to protect it. It is ultimately up to you to know the law when concerned about protecting what you created. When deciding on how far to take your protection, be sure to consider to what extent this property is important to supporting your revenue and competitive advantage. Sometimes it may not be important, such as a simple informational handout, but other times it may be extremely important, such as writing a book and planning to create workshops and programs around that book. As you develop your business, it is important to understand the role that your creation will play in the growth of that business.