Branding: the Nuts and Bolts of Creating and Protecting a Company Logo
| Jurisdiction | United States,Federal |
| Citation | Vol. 20 No. 08 |
| Publication year | 2016 |
by Walter K. Coronel and Kelly K. Suzuka
In today's globally connected and instant-media world, companies need to protect their intellectual property rights. When people hear the term "company branding," the image of huge international corporations often comes to mind; however, the same rights apply to companies large and small, whether local or foreign. Effective branding improves company recognition and develops goodwill that can ultimately translate into financial value. This article discusses the nuts and bolts of how a company would protect its rights in its company logo.
I. Protecting Your Company Logo: The Distinction between Trademark and Copyright
What is a logo? The first step to protecting intellectual property ("IP") rights is to understand what rights a company has and how they are acquired. From a trademark perspective, a logo is a design mark, i.e. a registered design that identifies the source of goods or services. However, from a copyright perspective, the image is a work of art fixed in a tangible medium. Acquiring rights to the image and protecting it as a design mark require analysis of the rights of at least these two bodies of law.
A. A Logo from an Artist's Perspective
When a company seeks to have an employee or independent contractor prepare artwork for use as a company logo, it must acquire rights from the individual through some manner of transfer of copyright. The Copyright Act of 1976 (Title 17 of the United States Code) governs copyright protection in the United States. 17 U.S.C. §§ 101-180, et seq. (2016). This Act provides protection for "...original works of authorship fixed in any tangible medium of expression..." (id. at § 102) for which copyright protection extends to both published and unpublished works. Id. at §104. Under the Act, the individual who actually creates copyrightable work is considered the author of that work. This individual obtains copyright in that work as soon as it is "fixed in a tangible medium," e.g. drawn, painted, or electronically created in software.1Should a company casually ask an individual to prepare an image for a logo, it is entirely possible that the individual would acquire copyright to the artwork, to the detriment of the company.
B. A Logo from the Business Perspective
Once a company has an image that it would like to use as a design mark, it must perform clearance searching, as discussed later in this article, to determine whether the mark is already in use by another party before it can establish rights in the design mark under the body of trademark law. A trademark can be a word, phrase, symbol, design or non-traditional mark, but this article will focus on a design that serves to identify and distinguish the source of goods (or services) of one party from those of others.2 The starting point to obtaining trademark rights in a particular mark is to use the mark on goods or in connection with services for the company business. This is the "use in commerce" requirement. Even if the company creates a logo, if it is not actually used in commerce (i.e., placed on products that are sold or printed on signs for a company's store) then no trademark rights will arise.3
II. Navigating the Creative Process: How to Acquire the Copyright in Your Logo
A. What's the Difference? Company Employee vs. Independent Contractor
When creating the image for the company logo, company management must carefully consider how to acquire rights in the copyright to the image for the logo, and whether or not the artist is an independent contractor or employee. Consider that even when an executive creates the image for the company, he or she may be considered the artist, and may need to execute documentation transferring the copyright in the image to the company. The general rule is that the person who actually creates copyrightable work is considered the author of that work and obtains copyright rights in that work as soon as it is created in a fixed form.4
1. How Do I Get the Copyright? Work for Hire vs. Assignment
Where the artist is an employee, there may be a very important exception to the general rule that the artist is considered the author of the work through the "work for hire" doctrine. Section 101 of the Copyright Act defines a "work made for hire" as "(1) a work prepared by an employee within the scope of his or her employment; or (2) a work specially ordered or commissioned for use as a contribution to a collective work, as a part of a motion picture or other audiovisual work, as a translation, as a supplementary work, as a compilation, as an instructional text, as a test, as answer material for a test, or as an atlas, if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire." 17 U.S.C. § 101. If a work is "made for hire" the employer can be considered the author rather than the employee who actually created the work.5 An employee's work-for-hire can be distinguished from that of an independent contractor in that the independent contractor must assign his or her copyright rights to another person or entity whereas the work-for-hire is automatically transferred. With respect to the work-for-hire, the employee or commissioned artist never had copyright rights to begin with. It is important to note this distinction in order to determine when a copyright assignment is necessary for a business to obtain copyright rights.
However, consider that a copyright assignment does not put the assignee in the exact same position as in the work-for-hire. 17 U.S.C. § 203(a)(3) provides that all licenses or transfers (e.g., assignments) of copyrights executed by the author on or after January 1, 1978 are terminable by the author (or his heirs) at a certain point in the life of the copyright (i.e., between thirty-five and forty years after the date of the transfer). 17 U.S.C. § 203(a)(3) (2016). The reason for this termination provision is that Congress intended to protect authors against permanent assignments of rights before the true worth of the work is established. H.R. Rep. 94-1476 at 124. Company management should be aware of this potential termination power by artists who are hired as independent contractors and assign the design copyright to the company.
2. What's Wrong with My Logo? Importance of an Original Work of Authorship
Before the employees or independent artists are set to work, company management should note that not all works that are created are protected by copyright. The worst scenario for a business is to waste time and money creating a logo that cannot be protected under copyright law in the first place. As noted above, only "original works of authorship" enjoy copyright protection. For example the following categories of material are generally not eligible for copyright protection: (1) works that have not been fixed in a tangible form of expression (for example, performances that have not been written or recorded); (2) titles, names, short phrases, and slogans; familiar symbols or designs; mere variations of typographic ornamentation, lettering, or coloring; mere listings of ingredients or contents; (3) ideas, procedures, methods, systems, processes, concepts, principles, discoveries, or devices, as distinguished from a description, explanation, or illustration; (4) works consisting entirely of information that is common property and containing no original authorship (for example: standard calendars, height and weight charts, tape measures and rulers, and lists or tables taken from public documents or other common sources).6Accordingly, part of the originality requirement is that there must be some level of creativity involved so as to distinguish the work from preexisting works. However, company management should not be too concerned as the amount of creativity required has been held to be quite low. For example, in Alfred Bell Co. v. Catalda Fine Arts, 191 F.2d 99, 102 (2d. Cir. 1951), the court stated that, "[a]ll that is needed to satisfy both the Constitution and the [copyright] statute is that the 'author' contribute^ something more than a 'merely trivial' variation, something recognizably his own."
3. What Do You Mean My Copyright is Gone! Completing the Assignment
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