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Licensed to Sell Patents, Trademarks and Licensing Bring Value to Your Business, but Ignoring Them Could Be Trouble

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Licensed to Sell Patents, Trademarks and Licensing Bring Value to Your Business, but Ignoring Them Could Be Trouble FEATURE | Licensing and Patents 64 | FEBRUARY 2017 | Licensing and Patents | FEATURE Licensed toSell Patents, trademarks and licensing bring value to your business, but ignoring them could be trouble. by Jen Alexander ’well. YETI. Fitbit. These brands Shave incredible recognition among clients, but they also come with the protection of patents and service marks. Of course, great ideas spawn great imitations— and sometimes those imitations are perfectly legitimate, as long as they don’t masquerade as the original. Innovation is one of the hallmarks of promotional products, and suppliers deliver innovation through patented products and processes. Supplier Gill Studios, Inc., has a portfolio of products that have been awarded patents and trademarks. Carl Gerlach, MAS, vice president of marketing at Gill, explains the process as well as the impact that patents and trademarks can have on a business. | FEBRUARY 2017 | 65 FEATURE | Licensing and Patents “We have developed products, then we have worked with lawyers to acquire patents. One product is our double-sided yard sign, for which we received multiple patents from the Patent Protection trademark commission,” says Gerlach. “With that patent, we are required to label every sign with the patent number and name of the So your client has seen a cool product and is adamant that you patent owner [Gill]. We also have patents on the can reproduce it. What’s your response? Follow these guidelines, manufacturing process for making the product.” from Harris Wolin of Myers Wolin, an intellectual property firm, to To obtain the patent, Gerlach explains, help your company navigate patent laws and observe the letter of the team at Gill begins with research to the law. “Mitigation of risk is the name of the game,” says Wolin. see if patents exist for identical or similar products or processes. “For registered marks What to do when ... [trademark, service mark, registration mark] You see a product at a trade show Someone asks you to manufacture you can do a little bit of research on your • Look for markings such as patent a product they’ve provided an own. Afterward, it’s best to get a patent numbers or service marks example of, or add it to your attorney involved; the attorney will help • Ask the supplier if the item line and pay them a royalty: you differentiate your product or service is protected by service • Look for service marks from what has already been patented or marks or a patent • Request indemnity from the registered,” he says. • Ask peers if they know individual or company; they The time it takes to apply and obtain a patent, about the product take over the defense in the along with the cost, might be prohibitive for case of an infringement suit some. However, says Gerlach, “We consider it a You see a product being sold by • Consult with legal counsel reasonable cost. It’s an up-front, one-time cost; another distributor/supplier: to conduct due diligence we do have to take into account what the sales • Look for patent information or potential for the product is.” service marks (If there are none, Someone asks you to make a If a product patented in the U.S. and and the product has been widely similar version of a product they manufactured overseas is also going to be adopted, perhaps no one has believe may be patented: sold overseas, says Gerlach, you should also the intellectual property rights) • Engage legal counsel to apply for an international patent. Because perform a patent search Gill manufactures its patented items in Someone asks you to make a and provide an opinion the U.S., the company has not pursued similar version of a product international patents. they’ve provided an example of: “Because 70 percent of industry product • Look for service marks comes from the Pacific Rim, I would highly • Request indemnity suggest getting an international patent and a • Request IP coverage U.S. patent,” he says. • Consult with legal counsel Gill-Line owns the patent for this double-sided yard sign. 66 | FEBRUARY 2017 | Licensing and Patents | FEATURE How to tell if a product or process is patented WANT From a supplier standpoint, the purpose TO LEARN of a patent or trademark is to differentiate MORE? yourself and your business from your competitors. Gerlach adds, “Part of building View Harris a brand is letting distributors know they can Wolin’s webinar depend on you. In our case, it’s going to be “It’s Not Just [that Gill products are] produced in the U.S. About Products, “By branding you can differentiate LOOK You Need To yourself among suppliers, and for patent markings Be Prepared customers know they’re going to get on every surface of the item. To Protect Your something of quality,” he says. Intellectual Gill also owns the trademark for Zip-Strips, Property As the super-removable adhesive backing Well” from his on its bumper stickers. Gerlach notes that live session trademarks and service marks, such as those at the 2016 associated with product options, are ideal for PPAI Product promotional purposes. Responsibility If you’re ready to patent your innovative CONDUCT Summit. Find it product or service, the first step is to do a patent search, under Education/ some legwork. using the company name as a starting point. Online Learning Harris Wolin of Myers Wolin, an at www.ppai.org. intellectual property firm, says while you can do some digging on your own, it’s beneficial What’s The Difference? LOOK Trademark for marketing/advertising signal words, A word, phrase, symbol or logo used to brand, identify such as: “exclusive product line”; “featuring and distinguish a product. Registered trademarks a unique...”; “uses an inventive ...”; “features are identified with the ® symbol. Unregistered a patented ...”; and “innovative solution.” trademarks are identified with the ™ symbol. Examples: Nike, Tiffany & Co. Service Mark A word, phrase, symbol or logo used to brand, identify or distinguish a service. Registered service marks are identified with the ® symbol. Unregistered service marks are identified with the SM symbol. REVIEW Examples: Walmart, McDonald’s a company’s website. The ‘About Us’ page often shows indicators of Companies that provide both an actual product and a service (think FedEx, innovation, invention and creativity: “patents”, with its shipping and packaging products) may apply both service marks “product development”, and “designers” and trademarks to their products, logos and slogans. are just a few key words to look for. Source: Myers Wolin Source: SecureYourTrademark.com | FEBRUARY 2017 | 67 FEATURE | Licensing and Patents to consult with your company’s legal counsel when researching whether a patent already exists. If no patent is found, companies can License To Print consider applying a “patent pending” to their product. However, says Wolin, that phrase may not be supported by Are you interested in adding also submit a completed Corporate paperwork. “Is the application filed with licensed products to your offerings? Responsibility and Supply Chain the U.S. Patent & Trademark Office?” he The process isn’t for the faint of heart. Compliance Questionnaire as well as a asks. “Even if it is published, the scope of The Collegiate Licensing Company is Factory/Supplier Information Form if it protection may not be fixed, and it may the official trademark licensing affiliate is required by the institution of interest. only cover utility or design—not both.” company representing nearly 200 U.S. The second phase of the application For these reasons, says Wolin, filing a colleges, universities, bowl games and process requires applicants to obtain patent application just to obtain “patent athletic conferences, as well as the insurance and submit authorized pending” status can be beneficial in the Heisman Trophy and the NCAA. manufacturers agreements from every process of securing a patent. CLC provides resources and guidance manufacturer and finisher that will be to help its partners manage their licensing used throughout the manufacturing Brand Licensing programs, which account for nearly 80 process, as well as institution-specific Branded merchandise is just as popular; percent of the $4.6 billion retail market artwork. Finished product samples what Chicago Cubs fan doesn’t want a for collegiate licensed merchandise. Read must be provided to any institution that championship t-shirt? But it takes more on for a snapshot of the process required maintains such a requirement. Applicants than loyalty to be allowed to emblazon to obtain CLC licensing. must also register with the Fair Labor brands on promotional products. To be considered for a standard Association if they wish to obtain a license Licensed merchandise requires a licensing and/or local licensing agreement, for one or more FLA-affiliated institutions. agreement, something not everyone interested parties must first complete The third and final phase requires can obtain. a license application and pay an applicants to sign a Labor Codes of Conduct Distributors are most often the party application fee, and submit a generic agreement, pay royalty advances to that will hold a licensing agreement, quality sample of each product for applicable institutions, and sign a Standard which allows them to sell branded which they want licensure. Parties must Retail Product License Agreement. merchandise on behalf of an organization or company. Obtaining a licensing agreement, says Wolin, can take time. PHASE PHASE PHASE “These types of negotiations are typically very involved, and multi-year.” 1 2 3 Once the negotiation is complete, he says, licensees are not necessarily • Complete license • Obtain insurance • Sign a Labor Codes of guaranteed expansive rights. “The rights application • Submit authorized Conduct agreement are a carve-out; you’re negotiating for a • Pay an application fee manufacturers • Pay royalty advances to little slice of the pie,” he says, meaning that • Submit a generic agreements applicable institutions licensees may be able to sell only certain quality sample • Provide finished • Sign a Standard items with a brand’s logo or name on • Submit a completed product samples to any Retail Product them.
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