How Exhibitors Can Protect Their Intellectual Property at Trade Shows
It goes without saying that trade shows can be frontiers of innovation and creativity, an incredible forum for viewing what industries are developing as the next best products or ideas. In only a matter of days, a leading trade show can display hundreds or even thousands of products, services and ideas in front of a global audience.
Yet all this added exposure on the showfloor can also serve as a catalyst for intellectual property disputes, including over trademarks, copyrights, trade secrets and patents on developing inventions and designs.
So, what can exhibiting companies do to protect their intellectual property and ideas? To address this pressing industry issue, TSNN consulted the experts, in this case, Dan Cleveland, intellectual property attorney at Fennemore Craig, to get his legal expertise on the importance of IP protection and how exhibitors can take action against IP infringement.
TSNN: Has your law firm been involved with any IP disputes that had their origins at trade shows or other events?
Dan Cleveland: I am relatively new to Fennemore Craig, although I have been practicing law for more than 20 years. In the past year, I have been involved in two IP disputes with trade show origins. They are still ongoing or have recently settled, so I cannot provide specific comments on those particular disputes. However, I am able to say that I have had involvement or have “closely witnessed” seizure of falsely designated NCAA jerseys and t-shirts, computer components and medical devices with origins at trade shows.
TSNN: In what specific ways can intellectual property be at risk at trade shows?
DC: It can be particularly galling for an exhibitor to sit at a trade show and watch a competitor gain commercial advantage through intellectual property infringement. There are different types of intellectual property and we primarily see the protections afforded by trade secrets, trademarks and patents being at risk at trade shows.
Trademarks protect the goodwill of your business. The purchase price for most companies far exceeds the value of physical assets that the company owns. The difference between this value and the purchase price is goodwill. In a trademark sense, this is the established expectation that customers have about the kind and quality of goods or services which the company provides. It is unfair if a competitor uses a trademark that gives consumers a false impression of origin for goods or services and so gains commercial advantage by misdirecting these consumers. This not only costs money by hitchhiking on your good name but also can damage your reputation by providing goods or services of inferior quality.
Patents are another type of intellectual property that can also be enforced at trade shows but this is more difficult to do. Patents are frequently used to distinguish products in the marketplace because a patent owner can exclude others from practicing what is claimed in the patent. It is commonly believed that having a patent in effect is a way to achieve higher margins on product sales. In “core technology” cases, patents may even entirely exclude competitors from direct competition with a product line, which is why you often see extremely high manufacturing margins in the case of on-patent pharmaceuticals.
If left unchecked at the trade show, patent infringement denies you the benefits of being an innovator as customers go elsewhere because you have higher prices. This also discourages innovation. Design patents protect the ornamental design of a product and this can be easy to ascertain. Utility patents are frequently more complex and may require more study before a case for infringement can be made. Even so, there are also simple utility patents and complexity is less of a problem if one has a bit of time in advance to study a competitor’s product.
Utility patents protect ideas or concepts and have claims that are directed towards combinations of limitations. To illustrate this, we can describe a breakfast that includes a limitation of bacon, eggs, toast and a sleeping pill. The standard breakfast of bacon, eggs and toast is un-patentable because it has been known forever. On the other hand, the Patent Office might be persuaded that adding a sleeping pill to a breakfast is patentable because most people would not want to go to sleep right after breakfast.
A trade secret is something that has inherent value due to the fact that it is not generally known to the public. A common concern at trade shows is the tradeoff of wanting to make sales by showing customers advanced technology, versus the risk of exposing key aspects of technology to competitors who may also visit your display. If you have these issues then you need to train the sales force manning your display not to over-disclose into the area of trade secrets.
TSNN: What are some key things trade show exhibitors should be aware of when exhibiting their products and services?
DC: Comparative statements and advertising are a fine thing to do, provided the comparison is strictly true and not misleading. Exhibitors should not be afraid to make these kinds of comparisons and may even call out competing products by their trademarked names. In doing so, however, they should be should be careful not to overstate their case into the realm of misleading prospective customers.
Also, if exhibitors know that they are functioning in an illegal manner or even in a gray area, they should be aware that it is possible for the offended party to get a court order and bring in a federal marshal to shut this down right on the trade show floor. This can even happen without having first brought them into court, but a caveat exists that the procedure for getting the court order requires the posting of a bond and the “infringer” must be reimbursed if there is a wrongful seizure. On the other hand, the same procedure is available as a remedy if an exhibitor is being harmed by knock-off products.
TSNN: What should exhibitors keep in mind when attempting to protect and enforce their IP rights?
DC: While the remedy is available, it does take some advance time to work through the process. Never say never, but since most trade shows last only a few days it is difficult to witness an instance of intellectual property infringement at a trade show as a matter of first instance and take action in time for a seizure order to make a difference. Even so, it is possible to use the awareness of infringement and soon after take action.
As you might imagine, a seizure order is a form of extraordinary relief. You have to meet strict requirements pursuant to statute and persuade a judge to approve an order that does not overreach in view of the concerns you are stating. One of the things usually placed at issue is whether irreparable harm will occur if the order does not issue. A lack of irreparable harm may be presumed from undue delay, so if you are the offended party this is not the time to sit on your rights and nurse a grudge.