Copyright Basics for Small Business Owners
Understand the importance of intellectual property and copyrights for your small business.
by Beniam Biftu
Note: This article originally appeared on hvacrbusiness.com. It has been republished here as a resource for our readers.
Your business is composed of two types of assets: tangible property and intangible property. Tangible property includes the property you can physically touch, such as your office building, computers, and stationery. Intangible property (i.e., intellectual property) includes the property you cannot physically touch, such as your business name, website, and advertising materials. It is your business’s intellectual property that is the most valuable asset of your business.
Most people understand the importance of a business’s tangible property. For example, if there were a fire in your office building, you may be temporarily closed until you make the necessary repairs. However, most people do not understand the importance of a business’s intellectual property. For example, if a former employee stole your company’s name or logo, this could be devastating to your business! In fact, it could cause you to be permanently out of business.
There are various types of intellectual property. The most prevalent are trademarks, copyrights, patents, and trade secrets. The difference between them all is not always clear. This article will help HVACR business owners to understand the importance of copyrights.
What can be protected by copyright?
In the United States, the Copyright Act of 1976 grants legal powers to creators of “original works of authorship.” This statute explicitly defines the categories of works that are protected: literary works, musical works (including accompanying words), dramatic works (including any accompanying music), pantomimes and, choreographic works, pictorial, graphic, sculptural works, motion pictures and other audiovisual works, sound recordings, and architectural work. Everyday examples of things that a business owner could protect by copyright are websites, photographs, articles, blog posts, advertising material, commercials, podcasts, movie clips, computer programs, and sometimes jingles and logos.
What cannot be protected by copyright?
Even though copyright law protects various types of works, it does not protect everything. Most importantly a copyright does not protect ideas, only the expression of those ideas. For example, you may have an idea for a commercial. It may even be original. However, if you never put your idea into action and “fix” the idea on some tangible medium, like a film or movie board, then it is not protected by the statute.
Copyright law does not protect slogans or names of businesses.
Additionally, copyright law does not protect slogans or names of businesses. Trademark law traditionally protects such assets and is the subject of next month’s article. Copyright law also does not protect methods of operation or works that have a utilitarian function. However, patent law may protect novel, useful, and nonobvious inventions.
What rights do you get as a copyright owner?
The Copyright Act grants exclusive rights to the owner of a copyright in a work. These exclusive rights are very different from the rights individuals have when they merely own the physical work. For example, a person who purchases a novel from Barnes & Noble may have the right to sell the book, but his rights are vastly limited compared to the rights owned by the copyright owner.
The copyright owner has five exclusive rights: the exclusive right to reproduce a copyrighted work, the right to prepare derivative works based upon the work, the right to distribute copies of the work to the public, the right to perform the copyrighted work publicly, and the right to display the copyrighted work publicly.
These are the rights that make copyright one of the most important assets a business could own. Just like the owner of the physical book can sell the book, the owner of a copyright can sell or license his copyright. These assets are highly valuable! It is not uncommon for such rights to be sold and licensed for thousands if not millions of dollars.
How do you protect your copyright?
Under the 1976 Copyright Act, authors of original works automatically get copyright protection the moment they create their work. Nevertheless, it is advantageous for business owners to register their work with the United States Department of Commerce. There are several benefits to registering your work with the federal government. Without a registered copyright your damages in a court of law are limited to lost profits, which could be minimal. In contrast, with a registered copyright you may elect to receive statutory damages as high as $150,000 per work willfully infringed. Another benefit of copyright registration is that a court will presume you are the rightful owner of the work. In other words, the burden will be on the defendants in a copyright infringement action to prove you do not own the copyright.
Finally, filing for copyright registration may on its face appear easy. After all, the questions on the application appear relatively straightforward. However, there are common pitfalls many business owners make in filing their own copyright registration. These mistakes could have devastating impacts down the road. It is advisable you consult a copyright attorney to ensure proper filing.
Please note: This article is for general information purposes only. It does not constitute legal advice, nor does it form an attorney-client relationship.
Mr. Beniam Biftu is a trademark and copyright attorney, counselor-at-law,and the founder of Biftu Law LLC (www.biftulaw.com). His firm was created to provide exceptional and affordable trademark counsel to small business owners and large international corporations. Mr. Biftu also helps up-and-coming artists, writers, musicians, and app developers secure and enforce federal copyrights.