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© 2011 Dean A. Pelletier Protecting Economic Drivers Because All Roads Lead To The U.S. January 14, 2011 The NAMM Show Anaheim, California Dean A. Pelletier, Board Member and Shareholder McAndrews, Held & Malloy (312) (direct)
© 2011 Dean A. Pelletier 1 Trade Secret Overview Intellectual Property (IP) Fundamentals Economic Drivers IP Protects Economic Drivers U.S. Marketplace Activity Chinese IP Law and Enforcement IP Strategies Leveraging IP Foreign Operations and IP Strategies Combating Foreign Unfair Competition
© 2011 Dean A. Pelletier 2 IP Fundamentals Patent (“what”) Utility Design Trade secret (“what”) Trademark (“who”) Copyright (“how”) Trade Secret
© 2011 Dean A. Pelletier 3 Economic Drivers Efficient manufacturing processes Innovative products Consistent product quality Quantity Price Equilibrium DemandSupply
© 2011 Dean A. Pelletier 4 IP Protects Economic Drivers Efficient manufacturing processes Innovative products Consistent product quality Trade Secret
© 2011 Dean A. Pelletier 5 U.S. Marketplace Activity U.S. ITC Year in Review, Active §337 Investigations (Number of Investigations Instituted by Fiscal Year (Oct. 1- Sept. 30)) §337 Investigations Instituted
© 2011 Dean A. Pelletier 6 U.S. Marketplace Activity Chinese companies are often sued in §337 investigations 55% 38% 42% 55% §337 Investigations Involving a Chinese Respondent or Goods of Chinese Origin 32%
© 2011 Dean A. Pelletier 7 U.S. Marketplace Activity Sources of counterfeit and pirated goods seized by U.S. Customs and Border Protection (CBP) (FY 2009): China: 79% Hong Kong: 10% Total value of seized goods from China (FY 2009): “only $205 million” China: Intellectual Property Infringement, Indigenous Innovation Policies, and Frameworks for Measuring the Effects on the U.S. Economy, Inv. No , USITC Pub. No. 4199, November 2010 (“ITC Report”), Executive Summary, xvi and 2-10, 3-15.
© 2011 Dean A. Pelletier 8 IP Laws and Enforcement in China China: form (IP law) vs. substance (IP law enforcement) “Enforcement of IPR [i.e., IP rights] laws remains a serious problem in China.” “Administrative IPR enforcement, consisting of raids and seizure of infringing goods, generally results only in temporary slowdowns in production; penalties are not sufficient to deter repeat offenders.” Certain items on China’s radar in December 2010: protecting trademark rights in local markets; clarifying landlords’ liabilities handling bad faith trademark registrations and imposing liability for facilitating online copyright infringement Reality: inherent level of IP infringement/misappropriation ITC Report, Executive Summary, xiii and 3-25;
© 2011 Dean A. Pelletier 9 Inventory IP assets Monitor the marketplace (e.g., trade shows, websites, customers) Implement policies and procedures Overlapping IP ROI IP Strategies
© 2011 Dean A. Pelletier 10 Leveraging IP Use (trademarks are unique) License Cross-license Sell Enforce
© 2011 Dean A. Pelletier 11 U.S. nexus Management Reasonable efforts (trade secrets) Foreign Operations and IP Strategies Catch 22 Opportunities Risks Inherent Express: IP transfer market access Foreign partner, subsidiary or licensee IP transfer; which IP? Written agreements IP ownership IP licenses 2 nd Place 3 rd Place 1 st Place
© 2011 Dean A. Pelletier 12 Combating Foreign Unfair Competition Protect U.S. market and operations from foreign unfair competition, including IP infringement/misappropriation Record registered U.S. trademarks and copyrights with CBP; work with CBP Criminal actions; e.g., U.S. Immigration and Customs Enforcement’s efforts against counterfeit and pirated goods Contact alleged wrongdoer(s) Civil litigation (U.S. district court, state court, U.S. International Trade Commission, alternative dispute resolution)
© 2011 Dean A. Pelletier 13 Combating Foreign Unfair Competition Protect foreign markets Obtain IP rights in foreign countries. Where appropriate, pursue foreign actions (administrative, civil, criminal, customs).
© 2011 Dean A. Pelletier Thank you... any questions? January 14, 2011 The NAMM Show Anaheim, California Dean A. Pelletier, Board Member and Shareholder McAndrews, Held & Malloy (312) (direct)
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ABA Annual Meeting All Rights Reserved Brief Overview of the Intellectual Property System in China Elizabeth Chien-Hale
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