Law Office of Nance L. Schick

Trademark Basics for Small and Micro-Businesses

I often post on our Ladies Who Launch Yahoo! Group and speak out to small business owners about intellectual property.  I have been getting a lot of feedback and inquiries as a result of my assertiveness. :)  So, I decided to post some very basic information for those of you who might be confused.  As I told some business owners who recently inquired:

This is a much more complicated issue than I can fully advise on in [a blog post], but to answer your questions as simply as possible:

1. Registering your trademark places others on notice that you are CLAIMING ownership. Nothing short of a Court Order granting judgment in your favor “means you own it.”
2.  Registration might DETER use or copying.  Nothing guarantees freedom from unauthorized use.
3.  Registration is ONE piece of evidence that could be used in litigation to show you were the first to use the mark in commerce.

I suspect my answers have caused quite a stir in your mind.  As I said, this is a much more complicated issue than you might be led to believe.  Trademarks are not like patents, trade secrets or copyrights, although people often lump all of the types of intellectual property together.  The main reason they are different is that the federal government has not required registration of trademarks and service marks over the years.  Having not completed my historical research, I suspect this is to keep commerce flowing rather than limit use of common marks, labels, etc.  This is why you might see restaurants with the same name in various parts of the country, for example, or there may be a number of businesses that use “Big Apple” in their titles.  You might also name your company Big Apple Business and register it thinking you own the trademark.  But lo and behold, you get a cease and desist letter from a company in Washington State that claims it has been using the trademark for 50 years.  If that company can prove its use began before yours, guess who probably owns the trademark…

DISCLAIMER:  THIS POST AND ALL INFORMATION ON THIS BLOG OR MY WEBSITE IS INTENDED ONLY AS VERY GENERAL INFORMATION.  IT IS NOT INTENDED TO BE LEGAL ADVICE.  IT IS NOT LEGAL ADVICE.  EVERY BUSINESS AND EVERY PERSON HAS VERY UNIQUE NEEDS AND CIRCUMSTANCES THAT CAN ONLY BE FULLY ADDRESSED BY AN ATTORNEY WHO HAS ALL OF THE INFORMATION.  PLEASE CONSULT AN ATTORNEY REGARDING YOUR INTELLECTUAL PROPERTY NEEDS.

The Magic Solution for Workplace Conflicts

The 05/29/08 NYCOSH NEWSLINE contains an article by Liza Frenette that also appeared in New York Teacher Magazine on 05/22/08.  In the article, Ms. Frenette describes a hazardous waste situation at a high school on Long Island, New York. According to her sources, the substances had been oozing and bubbling up through science classroom drains for up to two years.  When a teacher inquired about the safety of the situation, the inquiry was reportedly ignored. It took a brave whistleblower to correct the situation.  The harm that may have occurred in the meantime is still being addressed. 

This article reminded me of how often business owners or organizational administrators operate in fear and later cause themselves greater harm than in they had confronted the situation immediately.  Of course, we’ll never know for certain whether the Long Island high school’s situation would have been different.  But it seems rather obvious that failure to respond to a potential toxic waste leak could create a more hazardous situation for the people and property around the substances.  I am also surprised by the failure to act, yet I recognize I don’t know the full story.  I will reserve judgment to those better qualified. 

Regardless, we can all learn from the mistakes of the school’s administrators.  Please take your employee concerns seriously—all of them.  I am not suggesting that you accommodate every request, but be able to explain with specificity your reasons for taking actions or having the policies that you do.  My corporate management experience leads me to believe that many decisions are made as a reaction to damage that has already occurred.  I suspect all of us know someone who had a particularly bad situation with something, and many of us took that person’s story as absolute fact.  We then responded by copying the remedy he or she discovered through the hardship.  No questions asked.  We didn’t take the time to investigate the situation fully, and we were surprised when the remedy didn’t work for us.

We want the quick fix.  We want the magic solution. Are you ready?  Here it is: 

Every situation is unique and must be addressed as if it has never happened before.  It hasn’t.  it may look just like what happened to an elementary school in Niagara Falls or to someone your employee told you about.  But it’s absolutely impossible that the exact same event occurred at a different time, in a different place, with different people, and different circumstances.  Keep your mind open.  Do not make assumptions.  Listen and investigate fully.  Communicate your action with specificity, not only to assure your employees their concerns are being addressed, but also so you have greater clarity and confidence.  Clear and confident leaders are readily followed.

Rhode Island Could Use a Little Balance

I recognize that I sometimes get very frustrated and have been accused of being one-sided in my thinking on some issues.  Those of you who have worked with me or know me hopefully recognize that is not the real me.  I know that the answers are almost always in the gray--somewhere on that spectrum between the black and white we seek.

I was just reading about some changes in Rhode Island law regarding illegal immigrants and the workers' compensation system.  (Click here for the story on www.workerscompinsider.com)  According to this source, Rhode Island is taking it upon itself to deport illegal immigrants that find themselves in the criminal justice system.  This, I applaud.  I agree that the federal government is not taking action, and it makes those of us who try to play by the rules feel like the government we pay for is not protecting us.  Before you accuse me of being anything other than an advocate for fairness, understand that I feel the same way about any law that is not evenly applied.  This goes for everything from tax payments to traffic tickets.  I suspect the imbalances in application of our laws are adding to the entitlement mentality of American culture.  I am sometimes embarrassed to be American when I hear the lack of personal responsibility and accountability for our actions and choices.  I say clean up your messes, forgive yourself for making the mistake, move on, and make your life better.  Don't blame everyone else and expect others to do it for you.  You are amazing and powerful.  Show it! :)

The problem I have with the Rhode Island law is the application to injured workers.  Even as a defense attorney, I recognize the unfairness of denying benefits outright to workers who were actually injured while performing services for an employer who took advantage of the opportunity.  I have no problem with deporting them for breaking the law and working illegally, but they should still be compensated for their injuries.  They are still human beings!  Limit their benefits when they claim they can't find work because of their injuries.  We all know the lack of work is at least in part due to their illegal status, and there is almost no way to prove they are working off the books and under the table yet again.  so, give them a check and send them back home where they can heal and re-think their poor decisions.  Empower them, don't coddle them.  But don't punish them more than is warranted, either.

Patent & IP Attorney Amy B. Goldsmith

This morning, I attended a continuing legal education course taught by Amy Goldsmith of Gottleib, Rackman & Reisman, PC.  Aside from the fact that I love the firm's domain name (www.grr.com) and how it reminds me of my growls when people get so protective of ideas they will probably never do anything with, I was tremendously impressed by Amy.  She understands that every business is different and it is essential for the attorney to know more than just how to apply for and enforce a patent.  Her firm seems to do more than "go for the throat."  Although they know how to do that when it's necessary, they seem to advocate collaborative resolution--something that speaks to my soul.

Let's face it.  Business is going global.  Small business opportunities are increasing.  There is room for all of us, and it might be a bit unrealistic at times to focus solely on excluding competition.  Think about it.  If your product or service is truly unique, do you have any true competition?  What IS "competition?"

I am thrilled to hear that others are advocating cross-promotion, shared licensing and other win-win solutions.  We are becoming a world community, so maybe it's time to start thinking differently and trying new methods of living together in harmony.  I think it can be done...in time...with some mental reprogramming.  It starts here. :)  Are you in?

Could You Be a Hero, Too?

For those of you who haven't heard yet, my cousin's husband is a bit of a hero in the town they live in outside of Louisville, Kentucky (where I grew up).  Here's the link to photos from his amazing rescue of his neighbor and her dogs when the house went up in flames.  Jerry is so wonderful and humble.  He just reacted and did what felt right.  I am honored to have him in the family and to entrust him with my precious Donna! :) xo  I hope that I am never faced with such decisions, but if I am, I hope I am as brave as he.  May we all be as concerned for each other. ;)

Mediation Works Project Identifies Mediators Up for Election

The Elect Mediators to Public Office ("EMPO") Project was established to support the election of mediators and others who publicly advocate interest-based dispute resolution on their campaign websites. The project founders believe that having more mediators in public office will result in better political processes and better government because mediators possess knowledge and skills for non-adversarial resolution of differences.  Click on the link above to see who the EMPO Project endorses.  Not surprisingly, you'll see there are few candidates who qualify.

Wouldn't it be nice to see our leaders use techniques to create win-win solutions to all of our issues?  As a lawyer, I personally think everyone in public office should have some mediation training.  "Zealous advocacy" is often broadly interpreted to be "dilatory tactics" to increase (or decrease, for defendants) the amount of damages payable.  Neither party wins in this situation.  The lawyers, doctors and experts might, but then the zealous advocacy isn't really on behalf of the client, is it?

Mediation is based in the idea that every conflict can be resolved fairly, without the need for a winner and a loser.  It's an ideal, but I'd much rather have someone striving for this than to pump himself or herself up by stepping on someone else.  That, to me, is more of what the US intended with the Pledge of Allegiance...with liberty and justice for all!

Are Sections 114 and 114-a Relatively Benign?

The New York Workers' Compensation Law contains two provisions intended to deter and punish fraud, or "material misrepresentations."  Section 114 is the criminal statute that allows the Fraud Inspector General to indict those who misrepresent material facts in an attempt to obtain WC benefits to which they are not entitled.  Section 114-a is the civil statute that allows the Board to disallow and limit claims where there have been such misrepresentations.

This all looks good on paper.  It even looks good online, as the Insurance Department and Fraud IG's office occasionally send press releases regarding arrests. See CompNewsNetwork and WKTV.  But how is it applied?

Consider a recent case in which there is a sworn statement by a licensed professional and made to an Insurance Department investigator.  This statement completely contradicts the claimant's sworn testimony, and the professional's statement is also supported by other sworn documents kept in the normal course of business.  Regardless, the Judge couldn't look the claimant in the eye and decide any part of the case was disallowed.  So, benefits were awarded.

There are two major problems with this situation.  First, to find the claimant had not violated Section 114-a, the Judge essentially stated that the professional lied...under oath...to an Insurance Department investigator...with no apparent motive...and risked his professional license.

Second, failure to find fraud where it is clearly documented may also prejudice the criminal case.  Certainly, the claimant's criminal defense attorney will use this information in an attempt to sway the jury toward reasonable doubt.  After all, the claimant is now receiving benefits despite very credible evidence that he is a liar with a criminal past and simply can't be relied upon for the truth.  If a Judge found he was credible, won't a jury?

Even if a jury is more willing than an administrative law judge to apply the law with zeal, is this not of great concern?  Although juries are arguably more educated and savvy than in generations past, do we really want them to exhibit greater reasoning and critical thinking than our judges?

In short, it's time to pass laws we intend to enforce.  If we are not going to enforce them, they are a waste of everyone's time.  Don't give me lip service.  Give me truth.

Insurance Fraud Must Be Prosecuted

Not surprisingly, I agree with Barry Zalma, in Zalma's Insurance Fraud Letter, Supplemental March 15, 2008.  In this supplement, he reports:

The lawyer for the Department of Insurance of each state, including California, is the state attorney general. A special unit should be established in the office of California’s attorney general, funded with the money taken from the insurance industry to support the state’s effort against insurance fraud, rather than splitting the funds among local prosecutors who are not interested in prosecuting the crime. This unit should be given a simple mandate: File and prosecute every insurance fraud brought to the unit by the Fraud Division that has better than a 50 percent chance of success.

The unit established by the attorney general should concentrate on prosecuting everyday insurance fraud, the frauds of opportunity that take 90 percent of the money paid to fraud perpetrators, in the range of $5,000 to $50,000 as well as the major fraud rings. Single counts should be prosecuted. Multiple counts and multiple defendants simply make the cases complex and cause the courts to impose settlements on the parties. Teeth must be put in the posters that say: Commit insurance fraud, go to jail.

Yes, I am committed to conflict resolution, but this IS a resolution.  The conflict here is in what we say we support (e.g., prosecution of fraud) and what we actually do.  The law has no meaning if it is not enforced, and all we are asking is for enforcement.  It amazes me that we will spend thousands to go after counterfeit handbags or shoes, but we will ignore what claimant's attorneys jokingly call "corporate welfare."  Much more people are harmed by insurance fraud because it is pooled risk, funded by those of us who are law-abiding, tax-paying and premium-paying citizens.  When do we get star-designer treatment and have prosecutors take on those who cheat us?

Managed Care Matters Asks Why WC Reflects Medicare Rates

In his weblog (Managed Care Matters), Joseph Padua asks "Why Is Workers' Compensation Reimbursement Based On Medicare?"  He cites already low reimbursement rates to doctors and the differences in conditions treated.  Although I agree that "most of the working population is not old," he seems to assume that people on Medicare are old.  That may not be the case.

Many of the workers' compensation ("WC") claimants I see in my defense practice are men between 40 and 50 years old, and they are receiving Medicare benefits.  Some have been approved for Social Security Disability ("SSD") benefits because of their work-related conditions.  So, it makes sense that the two systems reflect each other. 

If we settle the WC case, we may have to get approval from the Center for Medicare Services ("CMS").  We will have to establish a Medicare Set-Aside ("MSA") amount that reflects a reasonable share of treatment expenses.  Otherwise, the injured worker might suddenly lose all benefits and still need treatment.  Again, the systems are interrelated.  Thus, it is not unreasonable that they are also reflective.

Fraud and abuse are additional reasons for modeling the two systems after each other.  Both systems are regularly defrauded by claimants, doctors, attorneys, and support personnel.  Symptoms and diagnoses are exaggerated.  Treatment is excessive.  Testing is conveniently done by a biased facility owned by the requesting physician.

Keeping reimbursements at a reasonable level likely deters those who see the systems as opportunities to get rich quick.  No, it doesn't deter everyone, but it probably attracts more people who truly want to work in the system.

Finally, I am unsympathetic to complaints that doctors have to fill out too much paperwork and effectively earn higher reimbursements by accepting the burden.  They should be keeping good records regardless of how it affects their rate of reimbursement.  How can they possibly remember all if the tiny but important details of a patient's unique physical make-up without good notes?  I certainly want my doctor to take good notes and make the most thorough and accurate determinations possible.

In short, WC and Medicare reimbursement rates are similar because the systems are similar and need to work together.  (Likewise, so are we and so do we. :))

Crackdown on Employers Results in Millions of Dollars in Violations

From NYTimes.com:

New York State officials reported on Monday that state investigators had found $19M in wages that were not reported and $3M in underpayments to workers. They also uncovered nearly $1M in taxes that had not been paid to the state’s unemployment insurance fund.

"The [15] sweeps grew out of a task force that Gov. Eliot Spitzer set up in September to crack down on companies that illegally classify employees as independent contractors, often to avoid paying unemployment insurance taxes and workers’ compensation premiums...

[T]he sweeps focused on the construction and restaurant industries and sought to ferret out off-the-books work as well as the misclassification of workers as independent contractors. State officials said that worker misclassification — from the failure to pay unemployment insurance taxes to failure to withhold income taxes — causes substantial revenue losses at various levels of government.

In their sweeps, which investigated 117 companies, state officials found that 2,078 employees had been misclassified as independent contractors. The task force also found 646 workers who were owed minimum and overtime wages totaling about $3 million."

New York’s labor commissioner, M. Patricia Smith said she wouldn't doubt that 10% of the state's workers are either misclassified or work off the books.