Taylor Swift Among Copyright Infringement Trend

Taylor Swift is one of the most renowned musicians in the world. As a master in her craft, Swift’s music spans the country and pop genres. Often writing songs pertaining to her own life experiences, she creates a bond with her audience, as many can relate to the same issues she writes about. In an attempt to thwart naysayers, she gains the affections of her fans, known as the Swifties. In addition to her physical presence, Swift commands a strong following on social media. At the beginning of this year, she boasted more than 85.5 million Twitter followers and 125 million Instagram followers.

While Swift has been a star since she began her career at the young age of 14, she continues to rise in popularity and stardom. With each of her five concert tours, she consistently increased her worth, attracting a bigger audience and generating more revenue, with fewer shows each time. In addition to her concerts, she generates revenue via endorsements, albums, and merchandise. As such, Swift’s net worth is upwards of $360 million.

Even though Swift enjoys a lucrative career for all of her efforts, she also faces contentions. One of those contentions that many musicians before her have encountered includes the threat of a copyright infringement lawsuit. This is not uncommon in the music industry, which is rife with such lawsuits. In fact, in the last five years, the number of infringement cases has risen, causing musicians to become extra cautious and spend more on emissions and omissions (E&O) insurance.

For musicians with chart-topping hits, they are at an even bigger risk of infringement claims. Such is the case with Taylor Swift and her biggest hit to date, “Shake It Off.” Songwriters Nathan Butler and Sean Hall claim that the hit contains phrases lifted from their song “Playas Gon’ Play.” Although the case was dismissed in February 2018 for unoriginal content, it has been reinstated by the Ninth Circuit. Both parties argue about the usage of the common words “Players” and “Haters,” and variations thereof. Butler and Hall claim Swift lifted the lyrics from their song, while Swift claims it is merely a coincidence.

This case, along with several others, present “Blurred Lines” within the music industry in regards to copyright infringement. In 2018, Robin Thicke and Pharrell Williams were handed a controversial verdict to the tune of $5 million, making it one of the highest profile copyright infringement cases in the music industry. The verdict raises concerns in the industry that it stifles song creativity for basing a decision on a music style rather than specific aspects of songs.

These concerns seem to be validated with the number of infringement cases increasing for star musicians such as Katy Perry, Ed Sheeran, Lady Gaga, and Taylor Swift, among others, since the filing of the “Blurred Lines” case. Given that a number of high-profile musicians have lost cases of infringement recently, it will be interesting to see how Swift will Shake It Off in this particular case. At the very least, musicians will have to take extra measures to keep their work protected.

5 Reasons Pandemics & Movements Create Trademark Pursuit

The year 2020 has created high emotions amidst a presidential election, movements, and a pandemic. Whether these instances cause fear, uncertainty, opportunities, anger, or happiness, the entire world is in it together. This year is especially unprecedented as everyone is affected in some aspect by any one of these issues.

As such, these issues create interest in the intellectual property realm, generating more trademark applications. The following lists five common reasons these issues heighten trademark pursuit:

  • Uniqueness: Often, a pandemic or movement brings about a new term (at least a term not familiar to much of the public). For the entire world, one of the most commonly heard terms this year is “coronavirus.” While coronaviruses have been around for ages, each new strain is given a name of its own. In the current pandemic, the coronavirus strain is known as COVID-19, short for “coronavirus disease 2019.” One of the qualities of good trademarks is that they are unique or distinctive and help consumers identify with products and services. Generic names that are common cannot be trademarked. Therefore, when a new global term comes along, it is not unusual for people to want to capture the word as their own.
  • Ownership: As the world’s population experiences the pandemic together, it brings a sense of belonging. Everyone is affected in some sense, from mask mandates, to contracting the actual virus, and even experiencing detrimental effects of the virus. Applying for a trademark gives people a sense of ownership and a sense of control.
  • Emotion: The BLM movement this year has spurred protests and riots. As such, strong emotions accompany this movement. Therefore, people may file for trademark applications with the hope that the movement remains relevant and important.
  • Capitalization: People apply for trademarks during movements and pandemics in the hopes of capitalizing on trending terms. As such, some trademark applications this year include “I heart COVID-19,” “Quarantini,” and “Social Distance Fitness,” among others. Common products people hope to use include T-shirts, other clothing, mugs, and more.
  • Misunderstanding: Many people hurriedly apply for trademarks with the misunderstanding that the first to file wins the rights to the trademarks. However, the first to file applies to patents, not trademarks. Often, people misunderstand that that they cannot simply rush to own a trademark just to own it; they must have a viable use for a product or service associated with that trademark.
As you can see, pandemics and movements spark many emotions that lead people to try and capitalize on specific terms associated with those issues. However, there is much misunderstanding in these circumstances. As such, applying for trademarks associated with these issues is typically a waste of time and money. Stay tuned for next month’s newsletter to learn about the main reasons why trademark applications are often denied in these circumstances.

5 Ways to Protect IP During a Pandemic

The spread of the COVID-19 virus around the world is forcing a new “work-from-home” environment. And it is likely that this environment will last past the pandemic, or at least continue in some version. As the days move into months, many people and businesses continue to adapt to changes in an effort to keep businesses afloat and salvage the economy. These changes require new ways of solving problems, presenting innovations, and protecting intellectual property. Therefore, while the pandemic has changed business as well as personal lives, it is important to remain diligent when it comes to intellectual property protection. The following list introduces five ways to remain competitive and protect IP during these uncertain times:

1. File on time. Everyone is adjusting to changes in the way we live and how we conduct business during the pandemic. Much focus is on salvaging jobs, worrying about future security, and remaining competitive. As such, it is even more important to meet IP application deadlines to avoid missed opportunities. It is especially critical to remember that the patent system remains a “first inventor to file” system. Therefore, it is important to continue pursuing patents amid the pandemic. With IP representing some of the most lucrative assets in a company, it is important not to let IP fall to the wayside.

2. Meet maintenance deadlines. While companies continue to contend with changes in conducting business, they must keep on top of IP maintenance deadlines. It could be detrimental to companies that let maintenance fees lapse-especially in such uncertain times. As many things continue to change and remain uncertain, those who stay on top of IP maintenance deadlines provide the best protection for their assets.

3. Look for infringing activity. As more business is conducted remotely, the potential for cybercrime increases. Therefore, while companies continue to focus on all other business aspects during the pandemic, more risks exists in infringing activities. As such, companies must keep an eye on and address any infringing behavior in the market.

4. Continue innovating. It is easy to get lost amid the turmoil affecting the world right now. However, those who remain positive about the future and offer new innovations will likely overcome and succeed the most.

5. Protect content. With more business conducted online, the risk of infringement increases regarding online content. It is wise to invest in copyrights regularly to protect original content and keep others from stealing or misusing that content. Copyright application costs are cheap compared to any other IP, making copyrights appealing in adding value to business.

As we all continue to work through the changes made by the pandemic, it remains crucial to keep on top of IP protection measures. These simple methods can provide a world of protection amid a world of uncertainty.

Tech Transfers: Essential to Innovation

Many companies provide a plethora of innovations. For instance, IBM, Samsung, Microsoft, Intel, and Sony own tens of thousands of patents for their innovations. But did you know that the products these companies sell contain inventions owned by other companies? For instance, Samsung and Google have a cross-license so that they can share innovations to enhance their products and take advantage of the expertise and intellectual property of each company. This helps them avoid unnecessary patent disputes. In the end, it is a win-win for them. However, there are smaller organizations that play a factor in products sold by large companies. These include technology transfer offices.

Educational institutions such as universities and research centers are invaluable to the innovative world. These institutions teach and train students with insurmountable information that they take with them to start careers, provide much-needed skills in the world, advance technology, and create cures, among many other things. While these institutes educate attendees, many of them also provide a place for attendees to develop and create important innovations that make a big difference in the world. As such, many universities have technology transfer offices.

Technology transfer offices patent and copyright discoveries developed in their labs. They then license the intellectual property to businesses that can turn the discoveries into beneficial products. At the beginning of this year, Caltech won a patent infringement lawsuit against Apple and Broadcom for a whopping $1.1 billion. This is just one case of the value technology transfers provide industries.

According to the Association of University Technology Managers (AUTM), its more than 3,000 members from more than 800 universities offer more than 22,000 technologies for licensing. To further highlight their value, check out their contributions in just a little over two decades:

  • Contributed $1.7 trillion to U.S. gross industrial output.
  • Contributed $865 billion to gross domestic output.
  • Supported 5.9 million jobs.
  • Disclosed more than 420,000 inventions.
  • Received more than 100,000 issued patents.
  • Formed more than 13,000 startups.

Technology transfers in some instances can be invaluable to our society and the world over. If you have ever questioned or wondered about the role of technology transfer offices, check out all of the work being done through them to tackle the  COVID-19 issue we are currently facing.

2019 Highlights: A Year in Review

It is hard to believe that we are already into the second month of the New Year! We look forward to each new year in the valuation business as it rewards us with new clients, new projects, new friends, new adventures, and new learning opportunities. Although we enjoy every new aspect of each year, we also value and enjoy our relationships with returning clients and acquaintances we have made in the business. For these reasons, we love what we do. Everything we do gives us an opportunity to learn and grow as a company and as individuals. We have some exciting changes coming to the Pellegrino & Associates firm in the near future, but for now, we would like to highlight moments from 2019.

Our projects last year covered a number of topics, such as the following: chemical looping, pork, motion-detecting electronics, wireless electronic vehicle charging technology, inverters, USB connectors, plastics, product teardown, malware, telepresence robots, artificial intelligence, satellites, trading strategy software, backtesting software, optogenetics, international student education requirements software, municipal solid waste sorting technology, RFID sensors, among others. As you can see, our job is never boring! Each project gives us an opportunity to learn about various topics, making our job interesting and enjoyable.

In addition to our projects, throughout the year we attended a variety of conferences and were invited by several organizations for speaking engagements, such as the American Institute of Certified Public Accountants, American Society of Appraisers, Rutgers University, Indiana Health Industry Forum, and AUTM Annual Conference.

Projects, speaking engagements, and conferences take us many places each year. In 2019, we traveled throughout the country to the following places: Las Vegas, NV; New Brunswick, NJ; Austin, TX; New York, NY; Boston, MA; Chicago, IL; Washington, DC; Delaware, MD; Los Angeles, CA, San Francisco, CA, Boulder, CO, and Montreal, Quebec.

In addition to our projects and speaking engagements, IAM published Mike’s article, titled “Not All Patents Are Created Equal: The Wizard of Oz and Patent Portfolios” in its IAM Magazine March/April edition. The article discusses the tactics companies use to play analytics tools and the patent system to their advantage. It provides examples of how companies grow their portfolios faster and how patent portfolios differ.

At our firm, we acknowledge the hard work it takes to provide excellent products to our clients. Therefore, we find it necessary and valuable to take time out once in a while to reward ourselves with fun, sometimes challenging, and team-oriented excursions. For one of our excursions, we flew to Phoenix, AZ to hike the Camelback Mountain at the elevation of 2,704 feet. We also attended the Bondurant High-Performance Driving School where we enjoyed learning valuable driving skills for all kinds of unforeseen circumstances. Once we graduated from the class, we all enjoyed some high-speed chasing on the track! Not to be outdone by the physical challenges we endured in AZ, we decided to try out a local spin cycling class. For some of us, it was a new experience, while others pushed themselves to a new level. Either way, it was a win-win situation as we squeezed in a workout while hanging with staff. Let’s face it, working out is always more fun with others!

As you can see, we keep busy throughout the year with a variety of tasks. There is never a dull moment! We can’t wait to see what is in store for 2020 with new projects, conferences, speaking engagements, company outings, and so much more. We appreciate all of our connections and the opportunity to continue learning and providing our expertise in the intellectual property valuation realm.

Trade Secrets Bring Great Value to the Food & Beverage Industry

Intellectual property brings many benefits to its owners, with each type of IP bringing different benefits. For instance, patents protect utility or functional designs as well as offer superior rights when infringement occurs. Trademarks help create brand awareness and demand. Copyrights protect works of authorship, giving authors exclusive rights for a fixed period. Trade secrets protect intangible assets, including any type of design, information, or other knowledge. However, trade secrets do not necessarily afford a company protection via a number of years, like patents. Nor do they offer specific monetary results in the event of an infringement, like copyrights. However, trade secrets can provide some of the biggest value to a company, as long as the trade secrets remain secret!

As already mentioned, each type of IP brings with it benefits and disadvantages when compared with one another. For trade secrets specifically, disadvantages include no federal protection, possible key person discounts, no prevention from someone deriving the same or similar design for an invention, and diligent administration and enforcement of non-compete and non-disclosure agreements, markings of documents, and more. However, trade secrets are easy and low cost to create, can protect more things without the kind of stipulations that copyrights and patents have, and do not require full disclosure like patents do. Therefore, when all of the elements are in place, trade secrets can be the most valuable assets a company owns. This is especially true for food & beverage companies.

The following list includes five of the most famous trade secrets in the food & beverage industry:

1. Coca-Cola: Coca-Cola is one of the most well-known trade secrets around the world. The company’s decision to keep the Coca-Cola recipe a trade secret rather than patent the concoction has positioned the company among the most valuable brands in the world. In fact, Forbes listed Coca-Cola in 2016 as the fourth most valuable brand. At that time, Forbes listed the brand worth at $56 billion. In 2018, the company commanded 43.3% of the soft drink industry.
2. Krispy Kreme: Krispy Kreme sets itself apart from other donut companies with its “fresh” donuts. While the company has kept its donut recipe under wraps for more than 80 years, it is not the actual recipe that makes it stand out, but the process in which it makes its donuts. The process that Krispy Kreme uses to make its donuts helps the company produce donuts on an assembly that allows for quick sale and gives the donuts a fresh taste. With more than 10 billion donuts made annually in the United States, Krispy Kreme accounts for 20 million of them. In 2018, Krispy Kreme donut sales reached $805 million in the United States.
3. KFC: Kentucky Fried Chicken’s 11 herbs and spices recipe has been the envy of restaurants worldwide for nearly 80 years. Until recently only one hard copy of the original recipe existed. Earlier this year, KFC took extra measures to protect its original recipe by storing a triple-encrypted copy in a nuclear bunker underground in Sweden. In 2018, the KFC brand generated $2.64 billion for its parent company, YUM! brands.
4. Twinkies: One theory for keeping a recipe a secret is that consumers may stop eating it if they fear or do not understand the ingredients, even if they are harmless. This is likely the case with Twinkies as some of the ingredients contain chemical names. As such, revealing the actual recipe could cost Hostess, the maker of Twinkies, a fortune. This is because Twinkies are among the company’s largest sellers. In a month’s time, within the United States alone, 31.44 million individual servings of Twinkies are consumed. Twinkies are among the top snack cakes within the United States, coming in fourth place (behind Hostess Cupcakes in second place) with 28.13 million people consuming them in 2018.
5. Thomas’ English Muffins: The English muffin market size reaches at least $500 million annually. Hands down, Thomas’ English Muffins is the most famous brand of muffins within the United States, selling more than one billion annually. What sets the muffins apart from other brands is the nooks and crannies that each muffin offers. The nooks and crannies make it easier for the muffins to soak up butter, jam, and other toppings. For more than 100 years, the brand has protected its secret. Therefore, no matter how many other brands try to emulate the recipe, they just cannot slice it.

As the bullets indicate, trade secrets hold extremely high value for companies when they are protected the right way. In fact, some companies can attribute their entire success to their trade secrets.

Taylor Swift’s IP Genius

Musicians are quite familiar with intellectual property–specifically, copyrights. Without it, they would struggle making a career from their music abilities. Copyrights protect their music (lyrics and audio recordings) so that others cannot steal or imitate it. This protection allows artists the ability to make money whenever their songs are played. However, the advent and popularity of streaming media makes it difficult for artists to control how and when people listen to music. Today, people have easy access to music, making it effortless to obtain it without paying for it.

While musicians rely heavily on copyright protection, the most successful musicians find many other ways to make money. Concert tours, endorsements, merchandise sales, and many other avenues contribute to a musician’s monetary success. Taylor Swift is just one of the musicians who has found various avenues to enhance her worth. One of the most creative ways she has managed to gain monetary growth is via her intellectual property savviness.

While copyrights are often a natural and given part of a musician’s success, Swift frequently utilizes trademarks to her advantage. Not only has she trademarked her name, but she has trademarked album titles (e.g., Reputation), phrases from her song lyrics (e.g., “This Sick Beat“), contest terms (e.g., SwiftStakes), and even the name of her pets (e.g., Meredith & Olivia Swift). Most recently, she became the proud owner of a third cat named Benjamin Button and has made the move to trademark “Meredith, Olivia & Benjamin Swift.”

Already estimated at a net worth of more than $320 million, Swift’s business tactics and concentration on intellectual property continues to garner new avenues for increasing her value. While her pets have nothing to do with her musical talent, her popularity gives her the ability to capitalize on many areas of her life.

Although unconventional in her moves to trademark song lyrics, pet names, and contest terms, they are smart business moves. Her trademarks will give her more net worth, but more importantly, they give her more control over her brand. That alone gives her great power. Who knows–she may even become one of the music industry’s biggest trendsetters in the trademark arena.

Playing Music Does Not Come Free: A Copyright Condition

Imagine going to a fitness class without music. How motivated would you be? How fun would a local bar be without a band or DJ to dance the night away? When visiting a local bar, restaurant, clothing store, fitness center, grocery, coffee shop, and other venues, we often hear music playing, even if it is subconscious. Imagine what life would be like without music? If we did not realize it before, we would feel like something was missing if there wasn’t background music in places where we just expect it to be playing. However, playing music doesn’t come free.

In many cases, listening to music is as simple as turning on a radio or television. However, every time you hear music, someone is paying to play that music. Whether it is a broadcaster or a venue, it, in most cases, must pay a royalty to the copyright owner if the music is protected by a copyright. This is because when a broadcaster or a venue plays copyrighted music, that particular business is using someone else’s intellectual property. Therefore, it must pay the people who created the music a fee. Typically, broadcasters and venues pay a blanket licensing fee that covers all music activities, such as live bands, karaoke, DJs, and more.

If a broadcaster or venue does not pay the proper licensing fees, then it may be infringing on the copyrights associated with specific songs. Musicians copyright their music to protect their work. Otherwise, anyone could take a song and claim it as his own and make money from it. Essentially, playing music in a public setting without proper licensing is the same as stealing. The penalty for such a crime can range from $750 to as much as $150,000, for each instance music is played without a license!

As you can see, the penalty for playing music without a proper license could cause a venue to go out of business, let alone deal with the troubles associated with a lawsuit. Therefore, it would be worth it for businesses to pay the licensing fee. Three organizations implement these licenses. They are called performing rights organizations (PROs): ASCAP, BMI, and SESAC. They do not hesitate to fine even the smallest venues. In fact, they file hundreds of lawsuits annually. Therefore, it is in the best interest for businesses to properly license music to benefit both themselves and the creators.

Music is a huge draw for a variety of reasons and finds its home in a plethora of settings. For most people, paying for music is likely a small sacrifice compared to the benefits.

Tiger Woods’ Masters Win Increases Brand Value

For years, sports commentators, fans, and others have been convinced that Tiger Woods should retire. His body seems to be falling apart from numerous injuries, with the most serious involving four back surgeries within four years. These injuries have caused him to miss many tournaments over the years and have affected his ability to perform at the professional level. In fact, it has been eleven years since he won a major championship. Along with his injury problems, Woods’ personal life has come under public scrutiny, namely a sex scandal and DUI charges. As a result, Woods’ career has not been a walk in the park.

At the young age of 20, he turned pro and was the youngest professional golfer to win the Masters in 1997. To date, Tiger Woods has won 15 major tournament titles, 81 PGA Tour wins, and 41 European tour wins, with five Masters wins. Woods is arguably the most famous professional golfer in the world with a net worth of $800 million and an annual salary of $50-60 million, topping at $1.5 billion since 1996, making him the most lucrative golfer in history. His accolades are numerous, including PGA Player of the year 11 times, Sports Illustrated’s Sportsman of the year twice, and AP Male Athlete of the year four times.

While Woods became famous for his golfing abilities, like many popular sports professionals, he actually makes the majority of his earnings from endorsements. His earnings for playing golf total $118 million since 1996 at 7.6% of his total career revenue. His earnings from endorsements are roughly 92.4% of his total career revenue at $1.4 billion. His recent win at the Masters makes him a hot target again for companies, especially Nike, which has stuck with him through everything. In fact, just minutes after winning the Masters, Nike broadcasted a new ad.

Woods’ particular career demands a relatively clean slate in the public eye and the ability to perform his job. If he underperforms and disappoints his fans with his personal choices, he risks losing his career as well as sponsors and fans, not to mention the value of his brand. Woods’ personal mistakes have already cost him an estimated $50 million in endorsements. However, in the sports world, perseverance and winning make a player more marketable and gives the public the incentive to become more forgiving.

Woods is a smart business man who doesn’t give up when the going gets tough. His recent Masters win benefited several companies that Woods endorses. For instance, during the Masters, Nike experienced $22.5 million in exposure, Monster Energy experienced $960,000, and Bridgestone experienced $134.000. And these are only a few of the companies he endorses. In addition to his endorsements, he received recognition from President Donald Trump with the Presidential Medal of Freedom award. Not to mention, Woods is an entrepreneur. His TGR company encompasses his many businesses including a restaurant, an events company that organizes PGA TOUR tournaments, TGR Design, which designs golf courses, and the Tiger Woods Foundation. Therefore, it is likely that Woods will be just fine for a long time to come. His Masters win was just the icing on the cake that will gain him even more attention and opportunities.

Difficulties of Trademarking a Common Term

Trademarks have a specific purpose. They help people identify with a particular product, service, company, or organization. Five types of trademarks exist.

  1. Generic marks: Trademarks to which one attempts to assign secondary meaning, though such attempts will always fail because the marks describe an entire group of products (e.g., aspirin). 
  2. Descriptive marks: Trademarks that take on a secondary meaning (e.g., McDonald’s).
  3. Suggestive marks: Trademarks that suggest a quality or characteristic of the good or service that it represents (e.g., Florida’s Natural branded orange juice).  
  4. Arbitrary marks: Trademarks that tend to describe goods or services that otherwise have no relation (e.g., Apple). These trademarks are generally very strong.
  5. Fanciful marks: Trademarks that tend to describe goods or services and likely have no other precedent in the market (e.g., Allegra). These are typically the strongest trademarks.

As mentioned, typically the strongest trademarks are unique names or words. However, occasionally, a common word can sometimes be trademarked as long as people identify it with a secondary meaning other than its original meaning or the word is used to describe a service or good. For instance, consider Apple. While the original meaning represents the fruit, it has taken on a secondary meaning as representation of the technology company Apple. In fact, when researching the term via Google, the first result that appears is the website for the company Apple.

While Apple has successfully coined a common term with a secondary meaning, this is no easy task. For instance, last year, the Boy Scouts of America (BSA)announced its plans to change its program name from Boy Scouts to Scouts BSA. The change would reflect its modification from an all-boys program to the inclusion of girls into the program. However, the Girl Scouts of the United States of America (GSUSA) objected to the change and sued BSA for trademark infringement. 

Although the two organizations have coexisted for decades without trademark issues, the GSUSA argues that the suggested name change creates confusion. Currently, the terms “girl” and “scouts” used together take on a specific meaning that associates directly with the GSUSA organization. GSUSA contends that BSA cannot have exclusive rights to common terms such as “scouting” and “scouts” in relation to girls. 

When the Boy Scouts was an all-inclusive boys program, there was no question as to whom the organization targeted. However, since the program now includes all genders, it is likely the organization will have to occasionally use the term “girls” and “scouts” to recruit or describe particular aspects of its program. Therefore, it may inadvertently infringe on the GSUSA trademark. In fact, some people have already mistakenly signed up their daughters to the girls’ programs in Boy Scouts, and others believed the two organizations merged.

The BSA argues that it has the rights to use “scouts” when referring to programs associated with boys and girls, and not girls exclusively. It further argues that the GSUSA only has rights to “scouts” when referring to girls.

As you can see, trademarking a common term can be complicated and difficult to implement. It will be interesting to see how this battle is resolved.