Book Opener

Figure 17.1Intellectual Property and TechnologyWith the advance of the Internet and other technologies, property owners insoftware and hardware increasingly rely on copyright and trademark protectionin these emerging areas of intellectual property.Trade SecretsA trade secret is specialized knowledge associated with a particular firm.These secrets include the business or manufacturing plans, unique technology,customer lists, and other sensitive information that, if known by a competitor,would put the company at a competitive disadvantage. Trade secretsare often protected by restrictive covenants, which are agreements withemployees not to work elsewhere in similar employment, or by agreements notto compete, which prohibit a person from operating a similar business in a certaingeographical area or for specified period of time.Computer software makers frequently treat their works as trade secrets. Thisapproach has the advantage of not having set time limits on legal protection.Many software producers have also attempted to use licensing laws to protecttheir work by requiring users to register their purchased software, often onlineat the producer’s Web site.Trademark ProtectionTrademark law is important to protecting property rights in software andhardware. For example, the law of trademarks applies to domain names.A domain name, such as Amazon.com®, is the Web address that uniquelyidentifies a firm on the Internet. This domain name is usually part of thelarger Universal Resource Locator (URL), such as http://www.amazon.com.Because companies want to protect the goodwill associated with their nameand want it to uniquely identify them in customers’ minds, they may usetrademark law to protect their domain name.The Anti-Cybersquatting Consumer Protection Act of 1999 makes it illegalfor someone to buy a domain name and then resell it to a company thatowns the trademark. To win a case under this law, a company needs todemonstrate that it owns the trademark and that the cybersquatter acted inbad faith in buying the domain name.Copyright ProtectionThe Computer Software Copyright Act of 1980 protects software makers.This act defines a computer program as a “set of statements or instructionsto be used directly in a computer in order to bring about a certain act.”Purchasers may make copies for themselves, but the law protects ownersfrom the kinds of widespread copying that result in loss of revenue.PROTECTING RIGHTS TO TECHNOLOGYThe laws are evolving to protect intellectual property rights in technology. Ifsomeone creates a Web site aimed at disparaging a business, should thebusiness be able to sue for damages?366 Unit 3: Understanding Consumer Law