Professional Practices

08

Outline: 08_ Intellectual Property Rights

• Introduction - What is Intellectual Property?

• Various IP Rights
• Confidential information
• Patents
• Trademarks
• Designs
• Copyrights protecting computer programs

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Introduction
ɞ What is Intellectual Property?
ɞ Intellectual property (IP) refers to creations of the mind, such as inventions; literary and
artistic works; designs; and symbols, names and images
ɞ In other words, Property that is intangible.
ɞ IP is protected in law by, for example, patents, copyright and trademarks, which enable
people to earn recognition or financial benefit from what they invent or create.
ɞ These laws regulate, rights to use, to copy or to reveal information about intellectual
property.
ɞ Internationally there are various IP laws.
ɞ Such as Trademarks and Patents law is based on the Paris Convention, which was
signed in 1883.
ɞ The Berne Convention, which lies at the basis of international copyright law, was signed
in 1886.

Introduction …
ɞ What is Intellectual Property?
ɞ Software can be very valuable, as the accounts of companies such as Oracle, IBM
or Microsoft show.
ɞ But software is intangible property.
ɞ The industry can only therefore protect its assets by using intellectual property
rights.

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Intellectual Property Rights
ɞ Various IP Rights:
ɞ Several different rights that relate to intellectual property.
ɞ However, we shall primarily be concerned with those that are relevant to software
and the information systems industry.
ɞ These rights should be looked on as a package; different rights may be used to
protect different aspects of a piece of software.
ɞ Confidential information
ɞ Patents
ɞ trademarks
ɞ Designs
ɞ Copyrights protecting computer programs

Intellectual Property Rights…

ɞ Various IP Rights?
- COPYRIGHTS
ɞ As the name suggests, concerned with the right to copy something.
ɞ There are three categories of work protected by copyright law:
1. original literary, dramatic, musical and artistic works;
2. sound recordings, films, broadcasts and cable programs; and
3. the typographical arrangement of published editions.
ɞ Copyright comes into existence when the work is written down or recorded in
some other way.
ɞ Copyright symbol (©), followed by the name of the owner of the copyright
holder and a year, is very often placed on copyright works (e.g., © Frank Bott
2013)

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Intellectual Property Rights
ɞ Various IP Rights?
- COPYRIGHTS
ɞ Copyright law gives six exclusive rights to the owner of copyright:
1. the right to make copies of the work.
2. the right to issue copies of the work to the public, whether or not they are
charged for;
3. the right to adapt the work. This includes translating it – whether from
English to Chinese or from C to Java;
4. the right to rent or lend the work to the public;
5. the right to perform, play or show the work in public;
6. the right to broadcast the work or include it in a cable programme service.

Intellectual Property Rights

ɞ Various IP Rights?
- COPYRIGHTS: Acts permitted in relation to copyright
ɞ There are certain permissions in relation to a copyright work
1. To make a backup of a program that you are authorized to use - however,
only one such copy is allowed.
2. you can ‘decompile’ a program in order to correct errors in it.
3. you can sell your right to use a program in much the same way that you
can sell a book you own. However, when you do this, you sell all your
rights. You must not then retain a copy of the program.

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Intellectual Property Rights
ɞ Various IP Rights?
- COPYRIGHTS: Databases
ɞ Copyright subsists in a database if ‘its contents constitute the author’s own
intellectual creation’.
ɞ There are many databases that do not satisfy this criterion but which,
nonetheless, require a lot of effort and a lot of money to prepare.
ɞ Examples might include databases of hotels, pop songs or geographic data.
ɞ In order to encourage the production of such modest but useful databases,
regulations were introduced in 1997 to create a special intellectual property
right called the database right.
ɞ It lasts for 15 years and prevents anyone from extracting or reusing all, or a
substantial part of, the database without the owner’s permission.

Intellectual Property Rights

ɞ Various IP Rights?
- Copyright Infringement
ɞ Copyright infringement is the use or production of copyright-protected
material without the permission of the copyright holder.
ɞ There are two sorts of infringement:
Primary infringement takes place whenever any of the exclusive rights
of the copyright owner is breached.
It is a matter for the civil courts and the usual remedies are available:
A claim for damages or an injunction to refrain from the infringement are
the most likely.

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Intellectual Property Rights
ɞ Various IP Rights?
- Copyright Infringement

Secondary infringement occurs when primary infringement occurs in

a business or commercial context.
In the case of software, this could involve trading in pirated software,
or it could involve using pirated software within a business.
This is a much more serious matter and may result in criminal
proceedings leading to a substantial fine or imprisonment and the
confiscation of the copying equipment, as well as civil damages.

Intellectual Property Rights

ɞ Various IP Rights?
- Licensing and assignment
Owner of the copyright of software may license other people or
organizations to carry out some of the activities that are otherwise the
exclusive right of the copyright owner.
The copyright remains the property of the owner but the licensees (the
people to whom the software is licensed) acquire certain rights.
The owner of the copyright can transfer ownership to someone else
completely.
This is known as assignment of the copyright and must be done in
writing.

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Intellectual Property Rights
ɞ Various IP Rights?
- Where does copyright law come from?
Pakistan is a signatory to the;
Berne Convention for the Protection of Literary and Artistic Work of
1886
Universal Copyright Convention of 1952
Agreement on Trade Related Aspects of Intellectual Property Rights,
1995 (the “TRIPs”).
Countries that sign the Berne Convention agree to establish national laws
protecting copyright along the lines described above.
The basic legal instrument governing copyright law in Pakistan is the
Copyright Ordinance, 1962 as amended by the Copyright (Amendment)
Ordinance, 2000.

Intellectual Property Rights

ɞ Various IP Rights?
- Examples of copyright cases involving software (Oracle Corp versus SAP AG)

Two of the top four software companies in the world.

Oracle alleged that SAP’s subsidiary, TomorrowNow, had infringed
Oracle’s copyright by downloading documentation and software from
its customer support site, using the credentials of Oracle’s customers.
Oracle took its complaint to District of California court in March
2007.
Initially SAP argued that it was entitled to download the material,
because TomorrowNow had been contracted by those customers to
provide third-party support for their Oracle products.
SAP subsequently admitted the infringement

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Intellectual Property Rights
ɞ Various IP Rights?
- Examples of copyright cases involving software (Oracle Corp versus SAP AG)

Oracle argued that the damages should be based on the amount that a
customer would have had to pay in license fees and support charges to
be able to access legally all the material downloaded by
TomorrowNow.
This amounted to some $2 billion.
In November 2010, the jury in the case awarded damages of $1.3
billion to Oracle, essentially accepting Oracle’s argument that the
damages should be based on hypothetical license fees.
However, later damages were reduced to $272 million.

Intellectual Property Rights…

ɞ Various IP Rights?
- CONFIDENTIAL INFORMATION:
ɞ Information “which is not public property and public knowledge”.
ɞ information cannot be ‘stolen’.
ɞ It is, however, possible to take action in court to prevent someone from using or
revealing information that they have received in confidence.
ɞ Important point is that the Information must have been given to that person in
circumstances that give rise to what is known as an obligation of confidence.
ɞ It is common for an obligation of confidence to come into existence as a result of
a specific clause in a contract.
ɞ Contracts for consultancy services or the provision of bespoke software will
include specific clauses binding each party to keep confidential any information
it obtains about the operations or products of the other.

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Intellectual Property Rights…
ɞ Various IP Rights?
- CONFIDENTIAL INFORMATION: Non-disclosure agreement (NDA)
ɞ Is an agreement that is specifically intended to set up an obligation of
confidence.
ɞ For example, when two companies are discussing possible collaboration, each
side will sign such a non-disclosure agreement to protect the information that
they exchange.

Intellectual Property Rights…

ɞ Various IP Rights?
- CONFIDENTIAL INFORMATION: Trade Secret
ɞ Refers to novel and effective techniques that companies develop to enable them
to produce goods that are uniquely attractive to their customers.
ɞ Secret ingredients in soft drinks etc., fall into this category,
ɞ the use of a novel data structure in the implementation of a database
management system may also be counted in this category
ɞ Such trade secrets are likely to be protected by an obligation of confidence, as
are ideas that might be the subject of a patent application.

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Intellectual Property Rights…
ɞ Various IP Rights?
- CONFIDENTIAL INFORMATION: Public interest disclosure
ɞ A court may rule that it is in the public interest that certain confidential
information is disclosed.
ɞ Over the years, there have been several instances in which employees have
disclosed confidential information about malpractice on the part of their
employer;
ɞ they have done this because they felt strongly that the malpractice – be it illegal
price fixing or serious environmental damage – should be stopped.

Intellectual Property Rights…

ɞ Various IP Rights?
- CONFIDENTIAL INFORMATION: Public interest disclosure
ɞ The types of disclosure that are eligible for protection are known as 'qualifying
disclosures’.
ɞ These are where the worker reasonably believes that the disclosure is being
made in the public interest
ɞ Where one reasonably believes shows that one or more of the following has
occurred or is about to occur:
 a criminal offence;
 failure to comply with a legal obligation;
 a miscarriage of justice;
 danger to health and safety;
 environmental damage;
 information showing that any of these has been concealed.

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Intellectual Property Rights…
ɞ Various IP Rights?
- PATENTS:
ɞ Government authority conferring a right or title for a set period,
especially the sole right to exclude others from making, using, or
selling an invention
ɞ The inventor must apply for the patent to be granted.
ɞ Grant of a patent allows patentee to prevent anyone else from
exploiting the invention, even if they have discovered it for
themselves.
ɞ After the monopoly period expires, everyone else is free to exploit
the invention.

Intellectual Property Rights…

ɞ Various IP Rights?
- PATENTS: What can be Patented?
ɞ As per the Patents Ordinance, 2000 in force in Pakistan, an invention is
patentable if it is
ɞ new,
ɞ involves an inventive step
ɞ and is capable of industrial application
ɞ the subject matter of the invention does not fall within an excluded class

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Intellectual Property Rights…
ɞ Various IP Rights?
- PATENTS: Obtaining Patent
ɞ Patent must be explicitly applied for.
ɞ In Pakistan Patents are granted by Patent Office of Pakistan which is the
part of Intellectual Property Organization of Pakistan (IPO-Pakistan).
ɞ Inventors who want protection in several different countries must, in
principle, apply separately to the patent offices of each country.
ɞ The full patent specification needs to be prepared by a specialist patent
attorney
ɞ It can take up to four years for the process of obtaining patents to be
completed.

Intellectual Property Rights…

ɞ Various IP Rights?
- PATENTS: Enforcing Patent
ɞ Grant of a patent is not a guarantee that it can be effectively enforced.
ɞ If you own a patent and you find that someone is infringing the patent, you
may have to go to the courts to enforce your rights.
ɞ In the court hearing, the offender can challenge your patent on the grounds
that it does not satisfy the criteria listed above.
ɞ The commonest challenge is on grounds of ‘prior art’, that is, that the
invention is not new.

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Intellectual Property Rights…
ɞ Various IP Rights?
- PATENTS: Software Patent
ɞ European Patent Convention and the Copyright, Designs and Patents Act
1988 both state unequivocally that a patent cannot be granted for a
computer program.
ɞ Despite these provisions, the European Patent Office has been granting
patents for software since 1998, as has the UK Patent Office.
ɞ The question of software patents has proved to be extremely controversial.
ɞ There are arguments for and against.
ɞ On the one hand, it is illogical and unfair that something that would be
clearly patentable if implemented completely in hardware should not be
patentable if implemented in software.

Intellectual Property Rights…

ɞ Various IP Rights?
- PATENTS: Software Patent
ɞ On the other hand, Patents are not helpful to small companies, which, even
if they can afford to file for patents, cannot afford to defend their patents
against invalid claims for patent infringement coming from large
companies.
ɞ the US Patent and Trademark Office (PTO) refused to grant patents for
any invention that involved a computer program.
ɞ In 1981, however, it was ordered by the Supreme Court to grant a patent

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Intellectual Property Rights…
ɞ Various IP Rights?
- TRADEMARK:
ɞ A trademark is any graphical mark which is capable of distinguishing goods
or services of one business from those of another business. A trademark may
consist of words (including personal names), designs, letters, numerals or the
shape of goods or their packaging.”
ɞ Some of the best-known examples of trademarks include
ɞ Coca Cola,
ɞ large M that serves to advertise McDonald's hamburger outlets.
ɞ Microsoft is a trademark as are the names of many Microsoft products such as
Outlook.

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Intellectual Property Rights…
ɞ Various IP Rights?
- TRADEMARK:
ɞ Trademark law in Pakistan is governed by the Trademarks Ordinance, 2001.
ɞ The primary purpose of trademark legislation is to stop the sale of bogus or
counterfeit goods, that is, goods that claim to have been produced by someone
other than the actual producer.
ɞ Trademarks are an effective way of protecting retail package software from
piracy.

Intellectual Property Rights…

ɞ Various IP Rights?
- DESIGN:
ɞ Drawing and designs, whether on paper, or on any other tangible medium, or in
the form of data stored in a computer, are frequently used to manufacture
industrial items, such as crockery, furniture, cars, aero planes, ships etc.
ɞ One aim of copyright law is to prevent persons other than the copyright owner
from copying either the drawing or any three-dimensional model produced from
the drawing.

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