What’s Your Copyright IQ?

By Andrew A. Gonzalez, Esq.

Andrew A. GonzalezIn the old days, the Power of the Press was a luxury reserved for those with a press. Today, anyone with a desktop computer and an internet connection can become an electronic publisher. Before the internet, any entrepreneur not only had to know the nuts and bolts of marketing, but they had to be aware of complex legal issues such as libel and copyright infringement. An unintentional mistake and you could be sued out of existence. Professionals understood that the Power of the Press carried with it great responsibility and legal risk.How much do you really know about copyright law? Click To Tweet

If you are a website designer, or business owner, it is time to wake up to laws that have always applied to intellectual property in the real world. How much do you really know about copyright law? A copyright is a form of protection for original works of authorship fixed in a tangible medium of expression. Dangerous myths about copyright law.

MYTH: If it doesn’t have a copyright notice, it’s not copyrighted.
FALSE. In the USA, almost everything created after April 1989 is copyrighted and protected whether it has a notice or not. The default you should assume for other people’s works is that they are copyrighted and may not be copied unless you know otherwise.

MYTH: It is okay to copy as long as you give proper credit to the author/artist.
FALSE. If you copy an original writing, graphic, song, or other work without
permission, you are guilty of copyright infringement. The Digital Millennium Copyright Act [DMCA] restricts access to or distribution of copyrighted material. Violators may be subject to civil and criminal penalties.

MYTH: I goofed and used someone’s graphic on my web page without realizing that it is copyrighted, but I cannot be sued as long as it was an honest mistake.
FALSE. Ignorance of the law is no excuse. Copyright law does not care about your “intent”, only that you have infringed work of another.

MYTH: It is okay to use less than 10 percent of someone’s work.
FALSE. Although it may be permissible to use limited portions of a work for limited purposes, there is no rule permitting a certain percentage of the work to be reproduced, distributed, performed or translated.

MYTH: The work doesn’t show a copyright notice, so it is in the public domain and content can be used freely.
FALSE. A work has automatic copyright protection the moment it exists and in tangible form. While it is good practice to insert a copyright notice, it is not mandatory.

MYTH: If I don’t charge for it, it’s not a copyright violation.
FALSE. It is a violation even if you give it away—and there can be serious damages if you diminish commercial value of the property.

MYTH: It doesn’t hurt anybody and it’s free advertising.
FALSE. It Is up to the owner to decide if they want the free ads or not.

MYTH: I paid someone to create something for me so I own the copyright.
FALSE. If the content creator is on staff, and the work is created during their employment as part of their job, usually the employer owns the copyright. If, on the other hand, the content creator is an independent contractor, then the contractor may own the copyright unless there is something in writing transferring copyright to you.

MYTH: I copyrighted the name of my brand.
FALSE. Copyright protects original works of authorship, but a trademark protects words, phrases, symbols and logos that identify the source of the goods or services.

MYTH: I can mail myself a copy of my work to protect it [commonly known as “the poor man’s copyright”].
FALSE. There is no provision in copyright law granting any such protection and it not a substitute for registration.

MYTH: If I am caught infringing, I will just stop.
FALSE: The penalties for copyright infringement can be severe, and the technology for catching offenders gets better all the time. The penalties for copyright infringement include both criminal and penalties.

The purpose of copyright law is to provide a commercial framework to ensure that artistic, intellectual or other works of value are fairly rewarded. The development of technology in general and the internet in particular has dramatically increased the ease with which works are violated. In this environment, a number of misconceptions have become common currency. This article is intended as an introduction to copyright laws and is provided in good faith to gain a general understanding of the topic.

Andrew A. Gonzalez, Esq. is an experienced attorney with over twenty-five years in practice. He focuses attention on business and intellectual property matters. He provides sophisticated services to commercial and individual clients who need to effectively compete in a business environment. For more information, call 914-220-5474 or email gonzalez@golawny.com.

Can Your Employees Hold You Responsible for the Performance of Their 401(k)?

By James Lange

James LangeA Supreme Court ruling in 2015 has given employers who offer retirement plans to their employees an enormous wake-up call. The employees at a California utility company successfully sued the firm over the cost of participating in their 401(k) plan. The court unanimously ruled that the company failed to meet its legal obligation to do what was in the best interest of its employees because the retirement plans that they made available to their workers charged fees that were significantly higher than average. Since then, employers in manufacturing, retail, communications, financial, and others have been named in a flood of new lawsuits from employees emboldened by the success of the plaintiffs in California. One paid $62 million to settle out of court and another followed by offering their employees $57 million to drop their case. Recently the spotlight shifted to the non-profit sector as several prominent universities became the latest targets of lawsuits alleging that for years employers have turned a blind eye and allowed their workers to be charged excessive fees for retirement plan contributions.

Plans that charge high administration fees are particularly egregious when the underlying mutual fund investment fees and management fees are also excessive. Even worse, if there is no true advice for the employee an employer can be scrutinized even further. Did someone sit down with each employee, describe the options, and help them decide on an induvial investment plan? Often, that answer is no. Many times, young workers are invested too conservatively. Other times, older workers make the mistake of “putting all their eggs in one basket.” They make this mistake most often by being over-weighted in large U.S. growth companies and underweighted in small, value, and foreign It is a good practice to periodically review the terms of your retirement plan and do comparisons. Click To Tweet

Hidden Fees Undo Retirement Plan Gains: As an employer, you have an obligation under ERISA to prudently select and monitor the provisions of your employees’ retirement plan. If you haven’t reviewed your plan recently, then this ruling by the Supreme Court should provide you with an incentive to do so. The first step is to know exactly what fees the provider of your retirement plan charges.

Whether you are evaluating your current plan or choosing a new one, consider these issues:

  • Ask about all investment fees. These are by far the largest expense associated with a retirement plan, and they may not even be apparent to you because they are generally deducted directly from investment returns. You might think you’re doing well because your monthly statement shows a $500 gain, but would probably feel differently if you discovered that your investment really earned $600 and fees amounting to $100 were deducted before the remainder was credited to your account! Here’s a tip: Make low-cost index funds available in your plan. Index funds strive to match rather than out-perform the market, and the savings that can result from this “hands-off” approach often result in lower costs for the plan participants who use them. Offering low-cost index funds will significantly lower your own liability and will likely be doing a huge favor to your employees. Getting the appropriate asset allocation with the low-cost index funds is the homerun for both administrators of 401(k) plans as well as most people’s retirement plans.
  • Keep administration costs as low as possible. These fees pay for the expenses of maintaining the plan. At a minimum, this includes accounting, legal services, and filing the appropriate paperwork with the IRS. Optional, and for extra cost, are services such as professional investment and retirement planning advice, daily valuations, online access to accounts, etc. Generally, the fewer bells and whistles associated with the plan you offer to your employees, the lower the administration fees will be. The balance between benefits and cost is critical.
  • Beware of individual service fees. They may not affect every employee, so many employers view them as a cost voluntarily assumed only by the individuals who choose to take advantage of the service. An example of this would be a fee charged to an employee who wants to take a loan out against his 401(k) plan. But, they also include fees charged to everyone for allocating their bi-weekly contributions in to the accounts. The definition of service fees can vary greatly, so it is important to know how your plan assesses them and to make sure your employees understand them.

In 2016, the Security and Exchange Commission’s Investor Advisory Committee (IOC) recommended that the SEC take steps to ensure that consumers understand exactly how much they pay in fees, and to show how those fees affect their investment return. If the SEC approves their recommendation, companies will be required to disclose their fees in terms of dollars instead of expressing them as a percentage. Your employees may be in for a shock when they find out how much it costs to participate in your retirement plan.

It is a good practice to periodically review the terms of your retirement plan and do comparisons. With constantly changing tax laws, you may find a different type of plan that results greater benefits for your business, and your employees. At a minimum, you will be sure that the costs associated with the plan you offer are reasonable and well understood.

Instead of filing lawsuits, your employees will thank you for looking out for their best interests and protecting their nest egg.

James Lange is a CPA/Attorney whose specialty is Estate Planning for clients with significant IRAs and retirement plans. He is the best-selling author of Retire Secure! and The Little Black Book of Social Security Secrets. His newest book is available on his website and Amazon: The Ultimate Retirement and Estate Plan for Your Million Dollar IRA. You can sign up for Jim’s books for free at www.paytaxeslater.com.

Legal Risks in Translations: Hanging On Every (Foreign) Word

By Martin Cross

Janel and her business partner Kevin go all in on their wearable-tech startup. They even get foreign patents translated into English to make sure there are no conflicts with their idea. Three years later, when their products are finally hitting the shelves, they receive a cease and desist letter. One of the Japanese patents that they had translated is now in force in the US with significantly different wording than their translation. In the US version of the patent, the term that their translator had rendered as “foot” is translated as “lower limb.”

This would cover Janel and Kevin’s device, which senses movement in the knees. It seems minor, but the difference in wording could render their own patent application invalid, and possibly put their business on the hook for infringement. Their attorney runs the matter by two different experts, but the facts are clear: while in casual conversation, the Japanese term can often refer to just the foot, according to any dictionary, it can also refer to the entire limb.

So, the Japanese patent covers their device – and years of work go down the drain. Janel and Kevin learn a hard business lesson of the globalized world: in matters of law, every word counts, even when written in another language.

Similar risks arise when translating agreements, contracts, specifications, annual reports, bills of sale and even some letters. In questions of evidence, such as for patents, it is the original document that counts and inaccurate translations can be contested in court. In other situations, the translation itself can be paramount, even when it is wrong. If you are using a French court to enforce a contract signed in French, it doesn’t much matter what the original English version said.

To avoid translation problems, it is useful to understand how they happen. In every language, individual words can have multiple meanings. Think about the possible meanings for “sentence,” or “right,” or even “impregnate.” Meanwhile, words don’t map one-to-one into other languages. For example, the Chinese word for “sentence,” meaning a grammatical unit, is different from the Chinese word for “sentence,” meaning a punishment. To pick the right one, a translator must first understand the exact meaning of the words in the original context. Now think about how well the average person understands each word in a contract, let alone in a patent, which brings us to these rules.

Use a Specialist: You wouldn’t go to your dermatologist to set your broken leg, and you shouldn’t have your legal or scientific translations done by the translator who localized your website. Find a translator or translation agency that specializes in the type of document that you need translated.

The next problem is caused by being human. When Gutenberg invented the printing press, the first and biggest impact was the elimination of transcription errors that, before the year 1439, had made each version of hand-copied manuscripts a little different. In the same vein, if you’ve ever played the children’s game “telephone,” you will have seen how easily humans make errors when they try to reproduce phrases faithfully. Now think about doing it between two languages! Because people also have trouble spotting their own errors, the best practice is to have one or even two additional translators review the first translator’s work.

Use a Team: Translation agencies have different quality assurance processes, from no-review, to spot-checking, to three-person verification. If the document could have important legal consequences, talk to your provider about their process. For critical translations, it may even pay to hire your own independent reviewer.

If you are starting to wonder how much all this costs, you’re asking a good question. What Janel and Kevin really needed for their patent translation was a person who was not only fluent in Japanese and English, but who would also understand the circuit technology involved in wearable devices, and know patent law well enough to grasp that the broadest interpretation of the terms would be required in the translation. They also needed one or two more similarly qualified people to check the translation and someone to coordinate all those things.

Beware of Bargains: If mistakes could hurt your business, don’t go with the place that offers to cut costs without first making sure that they won’t cut quality.

If you will be submitting the translation to a court or government agency, you may need to have it certified. But even in cases where a certification is not required by law, requesting one puts the translation provider on notice, right from the start, that you need a true and faithful translation for legal purposes, rather than the looser, more broadly interpretive renderings that are prepared for simple information.

Get it Certified: A certification is a statement of the translator’s good faith belief that the translation is true to the original, not a guarantee of accuracy, so don’t forget rules 1 through 3.

Of course, not every translation requires this level of expertise. Even a machine translation may be enough to tell you whether a foreign patent has any connection to your invention. Likewise, a bilingual administrative assistant might be able to prepare a first-draft translation of an agreement when you are still in the negotiating stage. But before you pick up your pen to sign a contract, or commit to spending the next few years working on a new product, make sure that the final translation is reliable. Be sure it was prepared by a specialist who was backed up by a team. Make certain you have good reason to be confident in the quality. And see that the translation has been certified.

These simple steps can make all the difference when your success depends on every foreign word.

Martin Cross is the president of Patent Translations Inc., serving law firms and patent departments in the US and abroad, and an active corporate member of the American Translators Association. The American Translators Association represents over 10,000 translators and interpreters across 91 countries. Along with advancing the translation and interpreting professions, ATA promotes the education and development of language services providers and consumers alike. For more information on ATA or translation and interpreting professionals, please visit www.atanet.org.

Should You Copyright Your Website?

By Andrew A. Gonzales, Esq.

Andrew GonzalezThe Internet makes it possible for businesses to reach millions of potential customers with a website. However, the Internet can be a source of liability for a company that is careless in publishing information.

If you have a blog, write articles, or manage an online magazine, chances are you have experienced—or will have—content stolen. The stolen content can be reposted on other blogs, article websites, and personal websites without proper attribution. Sometimes website content is copied in its entirety from your site to another website. There are also situations where your content is reposted with proper attribution, but without your permission.

The good news is that no matter how or why your content is used without your prior knowledge: there are measures you can take for such protection. There are even ways to prevent your content from being stolen in the first place.

How Do I Find Out If Content Has Been Stolen? Set alerts that make it simple to keep an eye on your website content and potential piracy. Set alerts for both your domain name and business name so anytime they show up in the search engine, you receive notification.

Who Owns or Hosts the Site? Contact the offending party directly to put them on notice to immediately remove infringing content. If this request falls on deaf ears, contact the online service provider (OSP). OSPs are often more efficient when it comes to removing potentially infringing content than web owners.

The Digital Millennium Copyright Act (DMCA) is landmark legislation that updated U.S. Copyright Law to meet the demands of the digital age. You can also send a DMCA Takedown Notice to the OSP requesting that they remove or block the offending pages from the suspect website.

What is a Copyright? Copyright is a form of protection given to authors of original works, including literary, dramatic, musical, artistic, and other intellectual works. A copyright automatically comes into existence the moment an author fixes work in a tangible form. This protection gives the owner of a copyright several exclusive rights:

  • to reproduce the work;
  • to prepare derivative works (works that adapt the original work);
  • to perform or display the work publicly;
  • to distribute copies of the work to the public by sale, rent or lease.

Why Should I Consider Copyright Registration? You’ve probably noticed phrases like “All Rights Reserved” or “Copyright 2016,” or perhaps the copyright symbol and a date at the bottom of a website. What does this mean? Do I need to copyright my website?

Registering a copyright with the United States Copyright Office is not mandatory. Copyright protection exists without registration; however, the “work” must be registered prior to filing an infringement case in court. In addition, the copyright owner will be eligible to receive statutory and actual damages as well as legal costs and attorneys’ fees from a copyright infringer. Registration provides notice to the public that you own the work making it more difficult for someone to claim they unknowingly infringed upon your copyright. There is also added credibility registration brings to the work.

Should I Register my Website? Copyright violation is illegal, but it can be difficult to prosecute offenders without copyright registration establishing a public record of ownership. If the content of your website is original (not a template), or if it includes an original work, it can be protected. Website registration will generally be made to protect the textual, graphic, and audio content of a site. All of these components should be submitted to obtain the broadest scope of legal protection.

Putting the Public on Notice: If a website contains copyrightable materials, a copyright notice should, at the very least, be placed on the site’s home page. Although not required by law, it is not a bad idea to place notice on every page of the website. The circle © puts the world on notice that you claim a copyright in the work. The proper way to use the © is in connection with the year of first publication and the copyright owner’s name (i.e. © 2016 Jane Doe or Copyright 2016 Jane Doe).

If you really want to make it clear that all aspects of your site are copyrighted, you may use a notice such as: All website design, text, graphics, selection and arrangement thereof, and software are the copyrighted works of Jane Doe © Copyright 2016.

Content theft on the Internet will always be a problem. Bear in mind that U.S. Copyright laws, cease and desist letters, careful monitoring, and all other actions can only get you so far. There is no 100% foolproof way to stop such action, but legal intervention may be warranted.

Andrew A. Gonzalez, Esq. is an experienced attorney with over twenty-five years in practice. He focuses his attention on business and intellectual property matters. He provides sophisticated services to commercial and individual clients who need to effectively compete in a business environment. For more information, please call 914-220-5474 or visit www.golawny.com.

Trademarks for Small and Medium-Sized Businesses

By Andrew A. Gonzalez, Esq.

Good naming and good marketing weren’t invented yesterday. Consider the story of John K. Hogg of Frederick, Maryland, a manufacturer of soap. Mr. Hogg had a concept for a special soap, so he applied for a trademark. STAR SOAP, he called it, and a star symbol was to be “printed, stamped or impressed upon the outside of each piece of soap,” as he wrote in his application. Yes, Mr. Hogg had real naming and marketing skills:

  • A simple, one-syllable name
  • A highly meaning word to convey both his aspirations and the quality of his product
  • A physical symbol built right into the name

And the rest of the story? Mr. Hogg was the recipient of Trademark #9. That’s right, the ninth trademark ever issued by the government of the United States. The date of his registration was October 25, 1870. Colt (first registered in 1889); Quaker (first registered in 1895); Pepsi-Cola (first registered in 1896; Mercedes (first registered in 1900).

What is a Trademark? A trademark is defined by the United States Patent and Trademark Office as any word, slogan, shape, color, scent, taste or any combination of these thereof used in commerce to identify and distinguish the goods of one manufacturer or seller from those of another and to indicate the source of the goods. A trademark is a mark that is applied to product. For example, if you sell footwear, then the mark you apply to the shoe (e.g. Nike) is a trademark.

A service mark is used in the delivery of services. If your bank is offering a checking account service called Smart Checking, this mark would be termed a service mark rather that a trademark, because it is used in the delivery of services rather than being applied to a physical product.

What are Trademarks for? Consumers who are satisfied are likely to buy or use the product or service again in the future. For this, they need to be able to distinguish easily between identical or similar products. The main function of a trademark is to enable consumers to identify a product or service of a particular company so as to distinguish it from other identical or similar products and services provided by competitors. You know what it’s like, walking down the aisles of a grocery store. Somehow you find the product you want out of the hundreds on the shelf. That’s the power of a trademark.

By enabling companies to differentiate themselves and their products from those of the competition, trademarks play a powerful role in the branding and marketing strategies of companies. The image and reputation of a company create trust which is the basis for establishing a loyal clientele and enhancing a company’s goodwill. Consumers often develop an emotional attachment to certain trademarks based on a set of desired qualities or features embodied in the products or services bearing such marks.

The Value of Trademarks: A carefully selected and nurtured trademark is a valuable business asset for most companies. For some, it may be the most valuable asset they own. Estimates of the value of some of the world’s most famous trademarks such as Coca-Cola or IBM exceed 70 billion each. This is because consumers value trademarks, their reputation, their image and a set of desired qualities they associate with the mark, and are willing to buy a product bearing a trademark that they recognize and which meets their expectations. Therefore, the very ownership of a trademark with a good image and reputation provides a company with a competitive edge.

While most businesses realize the importance of using trademarks to differentiate their products or services from those of their competitors, not all realize the importance of protecting them through registration.

Registration, under relevant U.S. trademark law, gives your company the exclusive right to prevent others from marketing identical or similar products or services under the same or a confusingly similar mark. Without trademark registration, your investments in marketing may become wasteful as rival companies may use the same or a confusingly similar trademark for identical or similar products or services. If a competitor adopts a similar or identical trademark, customers could be misled into buying the competitor’s product or service thinking it emanates from your company. This could not only decrease your company’s profits and confuse your customers, but may also damage the reputation and image of your company, particularly if the rival product or service is of inferior quality.

Receiving a trademark cease and desist letter or infringement notice can be an unsettling event. There are many circumstances under which you may receive one, but they all have one common thread – if the allegations in the letter are true, they can be devastating for a business. Securing ownership of intellectual property serves a prima-facie evidence of the validity and exclusivity of the mark for the goods and services listed in the registration and serves as defense to a conflict matter.

Given the value of trademarks and the importance that a trademark may have in determining the success of a business in the marketplace, it is critical to make sure that it is registered in the relevant markets. In addition, a registered trademark may be licensed to other companies, thus providing an additional source of revenue for your company or may be the basis for a franchising agreement.

How Can Your Company Protect its Trademarks and Service Marks? Trademark protection can be obtained through registration and, in some cases through use. Even where trademarks can be protected through use, you are well advised to register the trademark by filing the appropriate application. Registering a trademark will provide stronger protection, particularly in case of conflict with an identical or confusingly similar mark.

Yes, Mr. Hogg had real naming and marketing skills. Star Soap is still being sold almost 150 years later.

Andrew A. Gonzalez, Esq. is an experienced attorney with over twenty five years in practice. He focuses his attention on business and intellectual property matters. He provides sophisticated services to commercial clients who need to effectively compete in a business environment and personal counseling to individual clients who require the services of a seasoned and caring attorney. For more information, please visit http://golawny.com/.