An Engineering Science

TECHNOPRENUERSHIP

UEP College of Engineering

2021 Edition

Engr. Eladio Jao Jr.

 ES 311: TECHNOPRENUERSHIP 101

Module 3: Intellectual Property

Introduction

Have a brilliant new concept that you’re sure will make you a fortune? There’s a crucial step
any inventor or artist should take before taking it to market: protecting it with a patent,
trademark, or copyright from the government.

All three provide a legal shield against copycats trying to make a buck off your idea.
However, each designation applies to a specific type of intellectual property, so it’s
important to know the differences.

Learning Objectives

1. Define the four major types of intellectual property.

2. Be able to provide examples of each intellectual property type.
3. Understand how intellectual property can be a valuable resource for firms.

Defining Intellectual Property

The inability of competitors to imitate a strategic resource is a key to leveraging the

resource to achieve long–term competitive advantages. Companies are clever, and effective
imitation is often very possible. But resources that involve intellectual property reduce or
even eliminate this risk. As a result, developing intellectual property is important to many
organizations.

Intellectual property refers to creations of the mind, such as inventions, artistic products,
and symbols. The four main types of intellectual property are patents, trademarks,
copyrights, and trade secrets. If a piece of intellectual property is also valuable, rare, and
non-substitutable, it constitutes a strategic resource. Even if a piece of intellectual property
does not meet all four criteria for serving as a strategic resource, it can be bundled with
other resources and activities to create a resource.

A variety of formal and informal methods are available to protect a firm’s intellectual
property from imitation by rivals. Some forms of intellectual property are best protected by
legal means, while defending others depends on surrounding them in secrecy. This can be
contrasted with Southwest Airlines’ well-known culture, which rivals are free to attempt to
copy if they wish. Southwest’s culture thus is not intellectual property, although some of its
complements such as Southwest’s logo and unique color schemes are.
Figure 1 below shows the different types of Intellectual Property that are protected and
covered with legal entity.

Figure 1: The Different Types of Intellectual Property

Images courtesy of Sam Smith, http://commons.wikimedia.org/wiki/File:Harlem_Micky_Dz.jpg (second); United Press International (UPI
Telephoto), http://commons.wikimedia.org/wiki/File:The_Fabs.JPG (fourth); other images © Thinkstock.
 A. Patents

A patent is the granting of a property right by a sovereign authority to an inventor. This grant
provides the inventor exclusive rights to the patented process, design, or invention for a
designated period in exchange for a comprehensive disclosure of the invention. They are a
form of incorporeal right.

Government agencies typically handle and approve applications for patents which is part of
the Department of Commerce, handles applications and grants approvals.

Key Takeaways

 A patent is the granting of a property right by a sovereign authority to an inventor.

 A patent provides the inventor exclusive rights to the patented process, design, or
invention for a certain period in exchange for a complete disclosure of the invention.
 Utility and plant patents are granted for 20 years, whereas design patents are
granted for either 14 or 15 years, depending on when filed.

Understanding Patents

Most patents are valid for 20 years from the date the application was filed , although there
are circumstances where exceptions are made to extend a patent's term. U.S. patents are
only valid in the United States and U.S. Territories. If seeking protection outside of the
United States, it is important to research the intellectual property rights of other nations and
apply for protection with their governing authorities.

According to the U.S. Patent and Trademark Office, a patent can be granted to any person
who:

Invents or discovers any new and useful process, machine, manufacture, or composition of
matter, or any new and useful improvement thereof, may obtain a patent, subject to the
conditions and requirements of the law.

Types of Patents

There are three types of patents: (1) utility patents, (2) design patents, and (3) plant patents.
Each has its own specifications and durations.

Utility Patents

Utility patents, or patents for invention, issue legal protection to people who invent a new
and useful process, an article of manufacture, a machine, or a composition of matter. Utility
patents are the most common type of patent, with more than 90% of patents issued by the
government belonging to this category.

A utility patent lasts for 20 years from the date of filing as long as maintenance fees are
paid. Maintenance fees are surcharges applied to utility patent applications filed after
December 12, 1980.
Design Patents

Design patents are patents issued for original, new, and ornamental designs for
manufactured products. Design patents protect the design or look of something. They
require the invention to which the design belongs to be original and useful. Design patents
last for 15 years for applications filed after May 13, 2015. For applications filed before May
13, 2015, patents last for 14 years from the date of the filing. Maintenance fees do not apply
to design patents

Plant Patents

Plant patents go to anyone who produces, discovers, and invents a new kind of plant
capable of reproduction. These patents are granted for 20 years from the date of filing and
no maintenance fees apply.

Patents provide an incentive for companies or individuals to continue developing innovative

products or services without the fear of infringement. For example, large pharmaceutical
companies can spend billions of dollars on research and development. Without patents,
their drugs and medicines could be duplicated and sold by companies that didn't research or
invest the needed capital for R&D.

In other words, patents protect the intellectual property of companies to help their
profitability. However, patents also serve as bragging rights for companies demonstrating
their innovativeness.

How to Apply for a Patent

Before making a formal application, an applicant should research the Patent and Trademark
Office's database to see if another person or institution has claimed a patent for a similar
invention. The invention must be different from or an improvement upon a previous design
to be considered for a patent. Applicants need to take care to maintain accurate records of
the design process and the steps taken to create the invention. Enforcing the patent is up to
the person or entity that applied for the patent.

To apply for a patent, the applicant submits specific documents and pays associated fees.
Written documentation includes drawings, descriptions, and claims of the item to be
patented. A formal oath or declaration confirming the authenticity of the invention or
improvement of an existing invention must be signed and submitted by the inventor. After
fee payment, the application is reviewed and either approved or denied.

Patents protect the intellectual property of companies and help ensure their profitability, but
patents also serve as marketing for a company's innovation.

Figure 2 below show relevant Patents protected by the different companies an entities.
 Figure 2: Patents
Images courtesy of US government, http://commons.wikimedia.org/wiki/File:US-PatentTrademarkOffice-Seal.svg (top left); Louis
Bachrach, http://commons.wikimedia.org/wiki/File:Thomas_Edison2.jpg (bottom left); other images © Thinkstock.

Patents are legal decrees that protect inventions from direct imitation for a limited period of
time. Obtaining a patent involves navigating a challenging process. To earn a patent from
the US Patent and Trademark Office, an inventor must demonstrate than an invention is
new, nonobvious, and useful. If the owner of a patent believes that a company or person
has infringed on the patent, the owner can sue for damages. In 2011, for example, a private
company named EBSCO alleged that retailer Bass Pro Shops sold a product that violated
EBSCO’s patent on a deer-hunting stand that helps prevent hunters from falling out of trees.
Rather than endure a costly legal fight, the two sides agreed to settle EBSCO’s complaint
out of court.
Patenting an invention is important because patents can fuel enormous profits. Imagine, for
example, the potential for lost profits if the Slinky had not been patented. Shipyard engineer
Richard James came up with the idea for the Slinky by accident in 1943 while he was trying
to create springs for use in ship instruments. When James accidentally tipped over one of
his springs, he noticed that it moved downhill in a captivating way. James spent his free
time perfecting the Slinky and then applied for a patent in 1946. To date, more than three
hundred million Slinkys have been sold by the company that Richard James and his wife
Betty created.

Image courtesy of Roger McLassus, http://upload.wikimedia.org/wikipedia/commons/f/f3/2006-02-04_Metal_spiral.jpg.

Patenting inventions such as the Slinky helps ensure that the invention is protected from
imitation.

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Let us now assess yourself by an activity below on how you understand what patent really
is:

Name:____________________________ Course/Year:_______________ Date:________

Activity 1: Patents

From your business plan presented from the previous activity series module, Make a
canvass on the patented materials which are operationally use in your business as patent
users. Identify the type of patents are they.

On the other hand make a PERT-CPM on the process on patent application by assuming
days per steps per process.
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B. Trademarks

Unlike patents, a trademark protects words and design elements that identify the source of
a product. Brand names and corporate logos are primary examples. A service mark is
similar, except that it safeguards the provider of a service instead of a tangible good. The
term “trademark” is often used in reference to both designations.

Some examples of trademark infringement are fairly straightforward. You’ll probably run into
trouble if you try to bottle a beverage and call it Coca-Cola or even use the famous wave
from its logo since both have been protected for decades.

However, a trademark actually goes a bit further, prohibiting any marks that have a
“likelihood of confusion” with an existing one. Therefore, a business can’t use a symbol or
brand name if it looks similar, sounds similar, or has a similar meaning to one that’s already
on the books, at least if the products or services are related. If the trademark holder
believes there’s a violation of these rights, it may decide to sue.

Moreover, trademarks are phrases, pictures, names, or symbols used to identify a particular
organization. Trademarks are important because they help an organization stand out and
build an identity in the marketplace. Some trademarks are so iconic that almost all
consumers recognize them, including McDonald’s golden arches, the Nike swoosh, and
Apple’s outline of an apple.

Other trademarks help rising companies carve out a unique niche for themselves. For
example, French shoe designer Christian Louboutin has trademarked the signature red sole
of his designer shoes. Because these shoes sell for many hundreds of dollars via upscale
retailers such as Neiman Marcus and Saks Fifth Avenue, competitors would love to copy
their look. Thus legally protecting the distinctive red sole from imitation helps preserve
Louboutin’s profits.

Image courtesy of Arroser, http://wikimediafoundation.org/wiki/File:Louboutin_altadama140.jpg.

Fashionistas instantly recognize the trademark red sole of Christian Louboutin’s high-end
shoes.

Trademarks are important to colleges and universities. Schools earn tremendous sums of
money through royalties on T-shirts, sweatshirts, hats, backpacks, and other consumer
goods sporting their names and logos. On any given day, there are probably several
students in your class wearing one or more pieces of clothing featuring your school’s
insignia; your school benefits every time items like this are sold.
Schools’ trademarks are easy to counterfeit, however, and the sales of counterfeit goods
take money away from colleges and universities. Not surprisingly, many schools fight to
protect their trademarks. In October 2009, for example, the University of Oklahoma
announced that it was teaming with law enforcement officials to combat the sale of
counterfeit goods around its campus.Ward, C. 2009, October 8. OU works to prevent
trademark infringement. The Oklahoma Daily. Retrieved from
http://www.oudaily.com/news/2009/oct/08/ou-works-prevent-trademark-infringement This
initiative and similar ones at other colleges and universities are designed to ensure that
schools receive their fair share of the sales that their names and logos generate.

Figure 3: Trademark
Images courtesy of unknown author, http://en.wikipedia.org/wiki/File:Aspirine-1923.jpg (bottom left); Wilinckx,
http://en.wikipedia.org/wiki/File:Trademark-symbool.png (top left); Hult Ketchen International Group, LLC (top right); Helix84,
http://en.wikipedia.org/wiki/File:Burrbery_check.gif (middle right); Flat World Knowledge (bottom right).
------------------------------------------------------------------------------------------------------------------------

Let us now assess yourself by an activity below on how you understand what trademark
really is:

Name:____________________________ Course/Year:_______________ Date:________

Activity 2: Trademark

Make a trademark for your business plan. Be sure to describe every figure seen in your
trademark. It must be unique then post your trademark on your private account to gain 500
likes.
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C. Copyrights

Copyrights protect “original works of authorship,” such as writings, art, architecture, and
music. For as long as the copyright is in effect, the copyright owner has the sole right to
display, share, perform, or license the material.

One notable exception is the “fair use” doctrine, which allows some degree of distribution of
copyrighted material for scholarly, educational, or news-reporting purposes.

Technically, you don’t have to file for a copyright to have the piece of work protected. It’s
considered yours once your ideas are translated into a tangible form, such as a book,
music, or published research. However, officially registering with the U.S. Copyright Office
before—or within five years of—publishing your work makes it a lot easier to establish that
you were the original author if you ever have to go to court.

The duration of a copyright depends on the year it was created, as the laws have changed
over the years. Since 1978, most compositions have been copyright-protected for 70 years
after the author’s death. After that time, individual works enter the public domain and can be
reproduced by anyone without permission.

As a general rule, the author retains ownership of copyright privileges, even if the material is
published by another company. There is an important exception to this rule, though.

Materials you create for your employer as part of your job requirements, for example,
contributions to a podcast the company publishes, are usually considered "works for
hire." The employer, not you, retains the copyright. If there’s a gray area, you can try to
negotiate with the publisher over copyright ownership prior to creating the piece; just be
sure to get it in writing.
 Figure 4: Copyrights
Images courtesy of Johannes Vermeer, http://en.wikipedia.org/wiki/File:Girl_with_a_Pearl_Earring.jpg (bottom right); unknown author,
http://en.wikipedia.org/wiki/File:Copyright.svg (top middle);
http://en.wikipedia.org/wiki/File:Newspaper_advert_copyright_patent_and_trade_mark.jpg (bottom left); other images © Thinkstock.
Copyrights provide exclusive rights to the creators of original artistic works such as books,
movies, songs, and screenplays (Figure 4). Sometimes copyrights are sold and licensed. In
the late 1960s, Buick thought it had an agreement in place to license the number one hit
“Light My Fire” for a television advertisement from The Doors until the band’s volatile lead
singer Jim Morrison loudly protested what he saw as mistreating a work of art. Classic rock
by The Beatles has been used in television ads in recent years. After the late pop star
Michael Jackson bought the rights to the band’s music catalog, he licensed songs to Target
and other companies. Some devoted music fans consider such ads to be abominations,
perhaps proving the merit of Morrison’s protest decades ago.

Image courtesy of Polfoto/Jan Persson, http://upload.wikimedia.org/wikipedia/commons/1/15/The_Doors_in_Copenhagen_1968.jpg.

He looks calm here, but the licensing of a copyrighted song for a car commercial enraged
rock legend Jim Morrison.

Over time, piracy has become a huge issue for the owners of copyrighted works. In China,
millions of pirated DVDs are sold each year, and music piracy is estimated to account for at
least 95 percent of music sales. This piracy deprives movie studios, record labels, and
artists of millions of dollars in royalties. In response to the damage piracy has caused, the
US government has pressed its Chinese counterpart and other national governments to
better enforce copyrights.

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Let us now assess yourself by an activity below on how you understand what copyright
really is:

Name:____________________________ Course/Year:_______________ Date:________

Activity 3: Copyright
Check the steps on how you make your product or services. Copy your steps and paste it
on the Google search box. Make a citation for the steps which appears the same with the
Google search items. Review your brochure. Add your citation on the steps you made and
further add References on your brochure.
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D. Trade Secrets

Trade secrets refer to formulas, practices, and designs that are central to a firm’s business
and that remain unknown to competitors (Figure 5). Trade secrets are protected by laws on
theft, but once a secret is revealed, it cannot be a secret any longer. This leads firms to rely
mainly on silence and privacy rather than the legal system to protect trade secrets.

Figure 5: Trade Secrets

Images courtesy of Marcel Costa, http://www.flickr.com/photos/maccosta/5611261877/ (bottom right); ZooFari,
http://en.wikipedia.org/wiki/File:WD-40_Smart_Straw.JPG (top right); other images © Thinkstock.
Some trade secrets have become legendary, perhaps because a mystique arises around
the unknown. One famous example is the blend of eleven herbs and spices used in
Kentucky Fried Chicken’s original recipe chicken. KFC protects this secret by having
multiple suppliers each produce a portion of the herb and spice blend; no one supplier
knows the full recipe. The formulation of Coca-Cola is also shrouded in mystery. In 2006,
Pepsi was approached by shady individuals who were offering a chance to buy a stolen
copy of Coca-Cola’s secret recipe. Pepsi wisely refused. An FBI sting was used to bring the
thieves to justice. The soft-drink industry has other secrets too. Dr Pepper’s recipe remains
unknown outside the company. Although Coke’s formula has been the subject of greater
speculation, Dr Pepper is actually the original secret soft drink; it was created a year before
Coca-Cola.

Image courtesy of anyjazz65, http://www.flickr.com/photos/49024304@N00/4262262427/sizes/l/in/photostream.

The recipe for Dr Pepper is a secret dating back to the 1880s.

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Let us now assess yourself by an activity below on how you understand what Trade Secrets
really is:

Name:____________________________ Course/Year:_______________ Date:________

Activity 4: Trade Secrets

Make a poster which businesses adopted a trade secrets in your community. Make sure to
specify what product on a certain business is protected by trade secrets.

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Key Takeaway

 Intellectual property can serve as a strategic resource for organizations. While some
sources of intellectual property such as patents, trademarks, and copyrights can
 receive special legal protection, trade secrets provide competitive advantages by
simply staying hidden from competitors.

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Let us now assess yourself by an activity below on how you understand what Intellectual
Property really is:

Name:____________________________ Course/Year:_______________ Date:________

Activity 5: Intellectual Property

Make a collide picture on your knowledge towards Intellectual Property adoptable in your
business plan. Your Picture must be understandable to everyone.

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SUMMARY
The decision to pursue a patent, trademark, or copyright depends on the type of intellectual
property you are trying to shield. Whether it is a new product, logo, or creative work,
registering your idea with the appropriate body can help ensure you enjoy the fruits of your
labor.

REFERENCES
https://2012books.lardbucket.org/books/strategic-management-evaluation-and-
execution/s08-02-intellectual-property.html

https://www.investopedia.com/articles/investing/111014/patents-trademarks-and-copyrights-
basics.asp

https://www.investopedia.com/terms/p/patent.asp#examples-of-patents