Business Law and Intellectual Property Rights

Definition

Intellectual property is a fundamental legal field that entirely refers to the establishment of the mind such as artistic works, literacy and other musical works. It encompasses designs employed in the electronic commerce such as copyrights, patents, trade marks and all other related rights. The holder of these abstract properties is assumed to have exclusive rights of the properties under the property law and that he or she is patented to any inventions, commercial symbols and creative works

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On the other hand intellectual property rights are defined as collection of exclusive privileges over the creation of the mind which encompasses both artistic and commercial works. These rights are highly governed and protected by copyright laws which stipulate the right owners of the properties. These copyright laws protect the creative works which include movies, music, paintings, and other commercial software. The copyright gives the holder of the property exclusive rights to have full control of reproduction and adaptation of such creative works.

History

The history of the intellectual property rights dates back in 1845 where there was a court ruling in Massachusetts what they termed as Massachusetts Circuit Court. The ruling concerns mainly with patent case of Davoll et. V. Brown where the chief justice declared that intellectual property right could be the only possible way to protect the original owners of the inventions. In section 1 of the French law, it clearly provides protection to discoveries made. They protect the properties from being pirated. It stipulates that the author should fully enjoy his inventions. The law also gives assurances to the inventors of properties by giving him or her patent of five to fifteen years.

The intellectual property rights law can also traced back to potential origins such as Jewish law whose implications are more less the same as the current existing intellectual property rights laws. The law contains notable principles such as unfair encroachment. This principle is used to justify the real publisher but not the author of a given inventions. This was highly used in 16th century. The principles of the Jewish law did not carry any notions of intellectual property designs. The Jewish law prohibits any mental crimes which are interpreted under the law as theft of ideas as it amount to fraud and deception of intellectual property rights.

Philosophy behind the intellectual property rights

Intellectual property rights are thought to result from people’s intellectual talent and capabilities or abilities. The ownership of these properties has been made possible through patents, copyrights and trademarks. Inventors of a new product or service have exclusive rights towards the manufacture of the product as granted by patents. He or she is patented to use and sell the invention. Copyrights refer grants legal rights to authors, composers, artists, and publishers to carry their operations and dispense their work as they wish. Trade marks on the other end refers to designs and names which commonly recognized and registered under business operations are carried out. It is trademarks which differentiate products that are offered by certain business.

The philosophy behind these intellectual property rights and laws is to reward the original inventor, originals designer of clothes, publisher of book for their great efforts and good work they have done. These laws are very imperative in the sense that it acts as stimuli to other people to be very creative and innovative. This has the effect intensifying innovation and invention in the global economy. It acts has an encouragement to other personnel to look for comprehensive novel ways of doing things.

It is noteworthy that there exist different laws in different countries. Intellectual property rights and laws vary widely depending with countries where the property exists. The implementation of these laws differs from countries to country. Some countries are very strict when it comes to violation of these laws while others are so relaxed. Countries should sign international agreements to committing themselves to protect the intellectual rights for their own citizens and any other person who has invented something of value in economical life. Example of such international agreements includes Paris Convention for the protection of industrial property which comprises of more than 95 countries which are great signatories of it. These laws should be regulated and enforced with firm and bold terms to discourage vases of piracy occurring. Poor enforcement of these laws gives rise to piracy hence the real inventors of the idea benefit less from the idea. There countries that have been noted to be worst pirates as they offend these laws every now and then.

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Laws that govern the Intellectual Property Rights

There exist both national and international laws that are applicable to IPRs and some of the international conventions include

  • The Patent Corporation Treaty (PCT) – It provides global and international application patents. It regulates processes and procedures that are involve in the international operations of patents.
  • The Paris Convention of 1883 which regulates trademarks and patents
  • The Hague Agreement that deals with the international deposit of industrial designs
  • The Berne Convention of 1887
  • The 2 WIPO International treaties

The above are referred to as National laws. There are also certain Regional laws such as:

  • Community TM regulation
  • Directive and Protection of Copy rights.
  • European Patent Convention.

Intellectual Property Rights coverage and implementation

Intellectual property rights offer all-inclusive protection to all intellectual property vendors. There are comprehensive IPR policies which protect the owners and address the following subject areas.

Copyright

This issue is comparatively simple and it encompasses full protection of intellectual property owners i.e. it ensures that if a person has entirely contributed to any material in sophisticated manner, he is in a position to retain ownership of the invention or contribution he made. It also licenses the Standard Setting Organizations under irrevocable terms to make contribute to the original members so as to be included in the standard. Copyright also licenses the very organization to carry out the distribution of eventual standard as a whole or as a part.

The copy right also grants the SSO the ability to have ownership in the copyright of the final standard in which their contributed has been incorporated. There exist a lot of controversial issues in the implementation of the copyright policies. These controversy lie not in terms used but in the ability of the SSO to enforce its copyright when there are already existing standards as incorporated and referenced by the law. This is an issue of great important to SDOs due to the fact that it derives most of its revenue on the sale of their standards which contrast sharply with other companies which do not charge anything at all.

Remedies for copyrights infringements

There certain remedies that have been forward by European Unions and the United States for contravention of copyrights. Some of the civil solutions according to the US are:

  • Injunction
  • Monetary damages

The government of US has also imposed criminal sanctions for the infringement of the copyrights.

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On the other hand EU communities have postulated some remedies for copyrights contravention such as imposing of certain financial sanctions to member states. There also criminal sanctions for the same.

Trademark

Rules of trademark which falls under the policies of IPR are not controversial as such. International companies around the world have all been signing agreements to observe the rules concerning trademarks. The policies laid down permits the holders of the trademarks to retain the legal ownerships of the properties also that Standard Setting Organization retain ownership of theirs. Due to the fact that SSO are concern with conducting and licensing operations, it is quite imperative that trademarks policies are observed. A license of a well maintained trademark should be attributable to the characteristics of the product or services provider. These is a kind of precondition for hold the goods according after complying with the trademark standards.

Limitations of Trademark owners

There certain shortcomings of the trademarks. The fact that the owners cannot prevent the use of similar trademark for dissimilar goods and services has been a challenge to implementation of IPR policies. In the United States, the fair use defense had certain limitations as it was alleged to infringe the trademark owners as seen in comparative advertisement in the US media. Another limitation of trademark is the fact hat the rights become exhausted with time. The holder of the trademark can block the resale by claiming trademark infringement. This idea is not justifiable and not fair to many countries and some countries have gone to extend of exhaustion doctrines that control and regulate the time owner or the holder withdraws the sale of his or her products.

Sale, transfer and licensing of trademarks

Trademarks can be traded under various jurisdictions without the fundamental benevolence which exist in the business related to the mark. This is contrary to what happens in the US whereby there is a court ruling that postulates that this will amount to a fraud upon the public hence doing so is going against the laws of the country. Trade mark registration can be traded and assignments made with the provision that this should be accompanied by sale of the principal asset such as machinery that is used primarily to produce goods that bear the mark and sale of corporation that are involve in the production of the trademarked goods.

Licensing of trademarks to third parties are provided and govern by most jurisdictions whereby the licensor has the responsibility of ensuring that quality goods are produced by the other party to eliminate the trademark being regarded as useless due to the fact they are not govern by court rules. It is therefore mandatory that a trade mark license should offer reliable and appropriate quality control measures and that the licensee should give warranties as to quality. On the other hand, the licensor has the right to inspect and monitor production process.

Patents

The simplicity of intellectual property rights is realized under patents where there exist a lot of controversies which besiege the rules that are concern and related to claims of ownership made. Patent claims have been considered to be the most incredible issue to IPR. The designed for patent claims is a very tedious process as it can sometime used as a representation of to a difficult problem that calls for a solution. There are limited alternatives to problems pertaining patent claims. All possible alternatives carries some technical limitations or may not be economically feasible hence not easy to implement. To avoid these difficulties, the SSOs have employed other adaptation such at a greater length. These adopted specifications are intended to contravene patent claims made by persons who are not cooperative. It is hectic sometime if the patent owner is not willing to offer license to those who motivated to implementing the standard. It can be worst wish to provide license to other under strict conditions and terms that are almost impossible to be observed by others. They may also charge certain fee which might not be affordable by many. This issue has existed for along time and it is quite difficult to avoid them. The fact is that there exist patent infringement, and it is very difficult to conduct patent searches for every standard globally. This means that a lot of expenses will be incurred by the company. There are a lot of ineffectiveness and inefficiency when try to avoid any form of allegations of infringement. This is because of the fact that there are varieties of opinions from different owners of the patents on the extent to which their patents will cover. Few people who are holders of the affected patents will become members of a SSO. It is not possible to inquire or get information pertaining to the willingness of the members to act positively towards certain standards.

According to IPR policies, members of SSO are not mandated to conduct their operations of internal patent searches due to the fact that large numbers of SSOs might be having ownership in largest number of patents. And it is for this reason that that IPR policy should be very specific and that should be clearly indicated that no other shall be mandated to conduct any formal patent search.

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Confidentiality

Intellectual property rights policies cover the aspect of confidentiality through establishment of rules that fully explains what is suppose to be maintained in confidence and that nothing is to be regarded confidential. The distinction should be made whether information should made known to the public and the exact time to expose the information. This is mainly guided by economic concerns that revolve around the evolving standards that are of economical importance. This acts as an incentive for the non members to get motivated to be members. The evolving standards can inspire more inventions to be made by those who are allowed to view the text and notified with the direction of the standard under which development is underway. Patents under evolving standards should be made visible strictly to members that are bound to fully disclose all applications of patents. It is with a lot of concern that if emerging text is made available to all, some could be placed in a position where they can file and amend a patent application without going contrary to regulations and other rules that govern the process. This is the major reason behind the limitation impose by the SSOs on the level at which real members can access an evolving specifications. They sometimes restrict only to those who have been enrolled in the grouping that producing the property.

Implementation of Intellectual property Rights

Proper implementation of IPR policies is very essential as it leads minimal cases of fraud. This is often in two ways:

  • By board adopted policy
  • By inclusion in the application that every one who wants to be a member must sign.

Members are required to sign a shorter application in for the first way and that the application should include language that is binds all members to all adopted policies. IPR policies deployed tend sometimes to be highly documented hence demands for detailed policies to be put in place so that it can guide and provide procedures that should be followed by the working groups when trying to reconcile the standards that are being established. It should also stipulate the minimum number of persons that can vote and enforce any procedural mechanisms. Court has over time stipulates that IPR policy once has been adopted should described and enforced for it to be effective

Criticism

Intellectual property rights and laws have been subjected to negative criticisms by various personnel. These arise due to the fact before who are given absolute rights to the property end up exploiting others and enjoying the monopoly. Some of the great critics such as those of free culture movement argue that the interest of the public is highly affected if these laws are put in place and implemented. They criticize these property laws as intellectual protectionism or intellectual monopoly. The laws has the effect of limiting the extent to which legislation is given for copyright expansion, software copyrights and more so business methods patents. Some early critics argued that the term intellectual property should be done away with as it mislead. It should be rejected as it distorts and confuses the all idea of protecting the original inventors of these properties. Critics have further argued that the term was adopted by those who had intent of personal benefits and gains. It was used by those who wanted to confuse others so that they themselves can benefit from the properties. Early critics of the intellectual property laws have postulated that the term operates as catch-all that is anticipated to lump collectively disparate laws which has different origins. These laws must have evolved differently and carries different rules and operates under different public policy (Shaffer, 2000).

Role of government to intellectual property rights

Government plays a very important role in shaping the environment under which business is carried out. It regulates all operations that are taking place in the country. The government has also role of protecting the owners of intellectual properties from being pirated. It acts as referee and rule maker and other policies that should be followed. Government is much concern with ensuring that violation is not made to antitrust laws, technical standards that should be followed when dealing with intellectual property rights. It intervenes process involve in formation of mergers and acquisition of intellectual property rights that are being made in a country. The government acts as a referee on cases of intellectual property rights that give rise to takeover disputes. Business tries as much as possible to guard their intellectual property from any form of initiation through patents, copyright and trademarks. They do so by designating imperative information that the organization to keep it secret for its own beneficial. This acts as trade secrets to the business. Business organizations and other institutions often turn to the court to solve disputes that occurs.

Businesses are faced with a lot of competition and hence they should have proper business strategies to countercheck the strategies for competitors. The businesses have established antitrust laws that are used to challenge deals in court (Shaffer, 2000).

Current Issues and Trends of Intellectual Property Rights

There are a lot of changes taking place in global economy and thus intellectual property rights are included. IPR policies tend to describe the general shape that IPR policies should take. Due to changes in the economical environment, participants in the standard community setting are demanding that significant changes should be carried out. Some the current issues under discussion include:

Ex ante disclosure

The basic concept behind this is earlier is better and better. This entirely refers to granting permission those directly involve in the establishment of the a standard to reveal whether they have patents or willing to license them on RAND terms which should be covered in detail. This principle has caused a lot of questions to many. Instructions have been laid down to capture this issue and more so to govern those who participate in the standard setting. Those who are involved in the standard setting have been guided by lawyers. The lawyers have over time instructed them never mention anything with price in presence of competitors due to the fact that this could have implications when negotiating for prices. Departments are been established to monitor these principles. There are clear indications that if this principle is properly undertaken could be very favorable and that could have procompetitive effects rather than anticompetitive effects (Quinn, 2005).

The topic is very difficult to put it into practice and that a wide variety of opinions have been raised concerning this subject. Changes should be adopted so as to ease the implementation of the principle. Large companies especially in the information technology sector have shown a lot of concerns on the changes that should be made to ease the implementation of the principle. It is worthwhile to note that there also exist companies that are opposing the idea of introducing changes to ex ante disclosure. The reasons behind their opposition Has wide range from concerns on antitrust laws to beliefs that the companies have on the idea such as the fact that it does not proof to be of less importance. The ex ante disclosure principle has been opposed by many companies in order to retain a lot of freedom of movement in order to get maximum returns from the investments made.

Royalty free licensing

Infringing patents has raised a lot of concerns to many companies. Companies prefer adopting standards that would avoid these phenomena in a very effective way. This objective has been a priority to many companies and is determined to realizing the objectives due to advent of web technology (Quinn, 2005).

Open source licensing

Any one who wish to participate in commercial redistribution of the software products has to observe certain procedures. Many of the licenses under which open source software operates regulate the conduct of the participants. They should depict certain code of conduct when carrying out their operations. Some of these regulations concerns terms and condition that are acceptable and applicable to all patents fundamental to the implementations of the open principles. These has resulted in a lot of economical conflict or periodic clash between advocates that are concern with the open source licensing and those that are involve in development of open standards and this has give rise to a lot of complications due to inability to reach consensus between the two advocates over the implementation of the IPR policies. There was an added track and cover under which a group could make wise decisions whether to adopt a standard rules after the introduction OASIS IPR policy. It operated under conducive rules to open source implementations (Shaffer, 2000).

Harmonization

The sophistication that the implementation of the IPR policy carries has lead to further negotiations that could result in harmonizing the parties involve in achieving the consensus. Great amount of efforts and other recent initiatives are aimed at better understanding of the terms related to intellectual property rights and the policies implementations of the same. American Bar Association have propose underway efforts that could be employed by their subcommittee in the near future to foster harmony between parties involve hence leading to proper implementations of the Intellectual property rights. Thorough consultations have been carried out by attorneys with the intent of creating a very illustrative IPR policy which carries certain connotations that describes best the rationale behind the common intellectual property rights. The primary objective of this proposal was to grant permission the SSOs to upgrade their IPR strategies and other relevant policies. A lot of efforts have also been used to ensuring that participation in multiple SSOs is less sophisticated and does create a lot of burden to the parties involve (Quinn, 2005).

RAND specificity

There has been a lot of criticism to the imprecision and ambiguity of the RAND. Its litigation has also been subject of concern and that specific actions are underway to eradicate this issue (Shaffer, 2000).

Work Cited

  1. Curtis, M. “Business Law” 2006. pp 240-250
  2. Quinn & Eugene. “Understanding Trademarks”. 2005.
  3. Shaffer, A. “International Business Law and its Legal Environment.” 2000. pp 94-98.
  4. Bagley, G. “Managers and Legal Environment”. 2006. pp 200-240.
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