Intellectual property, faxes, advertising and pizza

Intellectual Property (n): A product of the intellect that has commercial value. Source: The American Heritage® Dictionary of the English Language, Fourth Edition Copyright © 2000 by Houghton Mifflin Company.

The definition shown above uses what I think is the broadest possible scope to define Intellectual Property (from here on I’ll use the abbreviation “I.P.”). Using this definition, I.P. is everything from a picture of Mickey Mouse to your great-grandmother’s “secret recipe” for garlic anchovy bruschetta and everything else in between.

WARNING: I will only deal with things in very broad strokes and my intention is only to bring this stuff to your attention – to get you thinking about it. If you really have detailed questions or are involved in a dispute, get yourself some basic research material (I like NoLo.Com) and an I.P. attorney (the good ones ain’t cheap).

Your Good Name, your face and your URL?

Most of us would not sit still for one minute if someone were to take over our name or face, but it kills me to think of just how many pizzeria owners have still not gotten around to buying the URL (universal resource locator, such as www.yourpizzeria.com) that matches their name on the internet.

If you are Joey’s Juicy Pizza, and you do a great pizza business, how would you like it if your competitor went out and bought www.joeysjuicypizza.com while you were sleeping? Pretty steamed? You bet. What if every time someone clicked on that URL they went to your competitors web site… Ouch! And it’s thoroughly avoidable for less than $20 a year. You just buy the URL that most closely matches you name. You don’t even have to put up a web site, just hold on to what’s yours! Take a look at www.pizzatrade.org for domain names.

Risk Management and I.P.

So you see, your name in all its forms is I.P. and has value. If you are ever called on to defend your rights to your own name it will cost big bucks. The good news is that recent case law is on your side. The bad news it will cost you big time to get things done. Most insurance policies will not cover this kind of expense. Sure, you can buy insurance for patent and copyright infringement expense, both on a first party and third part basis, but it’s expensive, the application process is cumbersome and the claims process is even more so. So, what to do?

Do some very obvious things now. Buy some basic research material and read up on this. Purchase your URL, trademark your name, be consistent with using your trademark, respect others’ rights in the same types of property and demand the same in return.

Advertising Injury

As a pizzeria owner, you are allowed to advertise within the bounds of propriety and law. You can’t take out an advertisement in the local paper that accuses your competitor of making pizza out of old socks and used chewing gum (unless you can prove he really does), but you can sing the praises of your own place and tell about what makes you unique and different.

If you are brought into a legal action, most business owners’ policies issued today will afford some coverage. That means legal defense and payment of a judgement as long as the “offense” is deemed to be in the scope of the coverage grant. Of course, if your main business is advertising, designing, etc., you don’t get this coverage. It’s for business people advertising their own business. There are other exclusions (of course) like:

• Unauthorized use of another’s name or product.
• Infringement of copyright, patent, trademark or trade secret.
• Wrong description of prices.
• Material published with knowledge of falsity.
• Knowing violation of another’s rights.

And more…

Faxes, Lawyers And You

Every morning when I come into my office there’s a stack of faxes that came in overnight. On any given day I’ll get a dozen. Most of them go right into the trash. Some make it to the second cut and the few I really want are saved. What they have in common is that almost everyone violates federal law regarding unsolicited fax communication.

An unsolicited advertisement is defined as “any material advertising the commercial availability or quality of any property, goods or services which is transmitted to any person without that person's prior express invitation or permission.” A person may grant permission to send a fax advertisement only with a signed, written statement that includes the fax number to which any advertisements may be sent. Just because your fax number is published or distributed does not mean others have permission to send you unsolicited advertisements. This is from the FCC web site at www.fcc.gov.

A lot of pizzeria owners are getting the idea that they can use their fax machine to reach business customers. I regularly get lunch menus from local shops and not one of them has “a signed, written statement that includes the fax number to which any advertisements may be sent” from me, but I get the faxes any way. Can I go after these guys for sending unsolicited faxes? You bet I can. Do I? Don’t be silly. It’s my experience that most people will just toss your unsolicited fax, but I know of one instance where the faxee really went after the faxor.

The faxee filed a lawsuit against the faxor. The claimed damages were for the statutory penalty of $500 to $1,500 per fax. The faxee alleges that he got 50 faxes after telling the faxor to stop. The math works out to a demand for $75,000 for sending out menus to a potential customer. The claim was turned in and is still pending. I don’t know the outcome yet, but I do know that someone took this stuff real seriously. The pizzeria now has a $75,000 demand hanging over his head. One thing I know for sure is that the pizzeria owner will be in for heartache and pain in the form of anxiety, lost business opportunity, lost focus, depositions, lawyer’s letters and more.

Risk Management and Good Sense For Fax Use

Here’s a way to avoid the heartache and pain that comes with this kind of thing: The FCC requires “… permission to send a fax advertisement only with a signed, written statement that includes the fax number to which any advertisements may be sent.” Take that as your cue to get the signed statement. Use your imagination, run a contest using the form as part of your entry. Give away a free lunch every month to some one on your permissive fax list. And, think about how much more valuable a permissive fax list is. These are people who want your stuff, not people who curse the sight of your menu!

Q: Isn’t that more difficult than just blasting out faxes to a rented list?
A: You bet it is!

Q: Will you sleep better than if you are the one who gets the $75,000 demand?
A: You bet you will!

Q: Will you get more sales from the permissive list?
A: I can’t guarantee it, but that’s the smart bet.

The Short Sweet Story

Everything from the famous picture of Whistler’s Mother to your kid’s hand-drawn picture on the refrigerator are potential intellectual properties. Some have more apparent value than others and the value of some has not been realized yet. What if your kid’s refrigerator art becomes the logo for your multi-unit franchise operation? On a more tangible note, your own name is I.P. and deserves protection now. Don’t let someone grab it out from under you.

The FCC has a serious policy in place regarding unsolicited fax communications. For me, it’s no longer theory. I’ve seen a lawsuit against a real pizzeria, not a national chain or some hot shot regional…a real “one-location” guy just trying to make a living. You can build a better relationship with your customers by getting a permissive fax list in place. Use some imagination and get going on this. The rewards can be great. Welcome to the information age! It’s not such a bad place once you get to know it!