1.Fundamental Intellectual Property Strategies: What every small business needs to know about Intellectual Property October 16, 2013 Jessica M. Mendez Samir R. Mehta 2013 Armstrong Teasdale Teasdale 2013 Armstrong LLP LLP

2. Plan of Action Maximizing the value of IP requires protection: Patents Copyright Trademarks Trade Secrets Contractual Agreements2 2013 Armstrong Teasdale LLP 3. Patents3 2013 Armstrong Teasdale Teasdale 2013 Armstrong LLP LLP 4. Patents - What They Protect Processes Machines Manufacture or composition of matter Any new and useful improvement in these areas More recently, business methods Patentable In The U.S. Not Yet Adopted Broadly Internationally4 2013 Armstrong Teasdale LLP 5. Patents - What They Give Right To Exclude Others from: Making Using Offering For Sale Selling Market Exclusivity Bargaining Tool Royalties5 2013 Armstrong Teasdale LLP 6. Patents The Process General Application Process Varies >1 YearPatent Clock6 2013 Armstrong Teasdale LLP 7. Patents What can they do for you? Patents are 3-way tools for companies, especiallysmall businesses Patents have been heavily used to protect inventions Significantly used in litigation by large companies,small companies, and non-practicing entities (NPEs) What does your industrys landscape like?7 2013 Armstrong Teasdale LLP 8. Patents and Small Businesses - AIA America Invents Act in effect since March 16, 2013 Most sweeping change to the patent system in 608years First-to-file replaces first-to-invent Prior art is more global in scope Grace period for one year after public disclosure and certain actions Micro entity status No more than four previous non-provisional patent applications > three times U.S. median household income 75% reduction in fees 2013 Armstrong Teasdale LLP 9. Patents How to Live in a Changing World Apply the rules where they exist Think broadly Think about the future Be as specific as possible Dont paint yourself in 9 2013 Armstrong Teasdale LLP 10. Patents and Small Businesses Be aware of existing patents, whether youre filing or10not Proactively search for patents in your space Receiving a demand letter Read the demand carefully and be mindful of timelines Consider contacting an attorney Pay attention to rules on public disclosure Many actions which you may not regard as disclosures qualify Competitors cannot benefit directly from your disclosures Provisional patents versus non-provisionals 2013 Armstrong Teasdale LLP 11. Patents - Why Small Businesses Need Them Patents can be tremendously valuable for a smallbusiness A good patent can add $1M to your valuation A good patent can give you an M&A strategy A good patent can let you redirect your focus via licensing A good patent can hold back competitors11 But you need a good patent! Patents can be expensive The landscape is rocky Technology changes rapidly 2013 Armstrong Teasdale International protection is complicated LLP 12. Patents How to Avoid Workaround Traps! Workarounds are always a problem in patentsworkarounds can diminish the value of your investment Consider what you want to protect Business today often involves many players to consider Your competition Your partners Your customers Software patents do not protect code Code is for copyright its a different ballgame 12 2013 Armstrong Teasdale LLP 13. Patents Strategies for Small Businesses Consider where your edge is Is your business about the product, the execution, or13both? Non-software companies routinely get software patents now Consider the IP in your industry carefully Innovation novelty Some industries are crowded from an IP perspective, others are blue sky If you have novel tech, a patent may help your valuation Alternative path: Trade secrets 2013 Armstrong Teasdale LLP 14. Copyrights14 2013 Armstrong Teasdale Teasdale 2013 Armstrong LLP LLP 15. Copyright - What it Protects Original works of authorship fixed in a tangiblemedium of expression Originality: originates with the author Fixation: recorded in a medium that can be reproduced Expression: does not include ideas Examples: Written Materials, Graphic Works, Audiovisual Works,Musical Works, Software 15 2013 Armstrong Teasdale LLP 16. Copyright - What It Gives Protects Works By Giving Exclusive Right To: Reproduce Make Derivative Works Distribute Perform Publicly Display16 2013 Armstrong Teasdale LLP 17. Copyright - What To Do Consider copyright registration Simple, fast, and cheap Not required to own your work, but required for a lawsuit Provides statutory damages and attorneys fees when timely Add copyright notice on materials or Copyright + year of first publication + owner Consider protection when entering into contractualagreements Use Work-for-hire agreements when appropriate 17 Avoid infringement of others copyrights 2013 Armstrong Teasdale LLP 18. Trademarks18 2013 Armstrong Teasdale Teasdale 2013 Armstrong LLP LLP 19. Trademarks - What They Protect A trademark is a word, name, symbol, and/or device used to indicate the source of the goods or services A trademark owner has the: Exclusive right to use the mark on specifiedgood/services Right to stop other uses of identical or similar marks which are likely to cause confusion But the trademark must be used 19 2013 Armstrong Teasdale LLP 20. Trademarks - Examples Forms of Trademarks NIKE A Design A Slogan A Sound The NBC Chimes A Number 7-ELEVEN A Color Pink of Owens Corning Insulation A Shape Vehicle Grill Trade Dress Product Package, Restaurant Dcor A Word 20 2013 Armstrong Teasdale LLP 21. Trademarks What To Do Select A Strong Trademark Inherently Distinctive Strong marks have no inherent meaning or relation to thegoods and services you offer Weak marks include words that describe the goods and services you offer Generic terms for the goods and services you offer cannot be protected After Selecting a New Mark: Do a trademark search to avoid infringing other marks Register and Maintain your Mark 21 2013 Armstrong Teasdale LLP 22. Trademarks How to Maintain your Mark Maintain Registration Trademark Use Trademark Notice Symbol for a registered mark For an unregistered mark on a product SMfor an unregistered service mark Trademark Enforcement 22 2013 Armstrong Teasdale LLP 23. Trademarks Domain Names Trademark infringement through domain names isoften used to divert internet traffic from your business to a competitor Periodically search to see if competitors are using your trademarks through a domain name Be sure your own domains are not too similar to yourcompetitors trademarks or you may be accused of infringement23 2013 Armstrong Teasdale LLP 24. Trade Secrets24 2013 Armstrong Teasdale Teasdale 2013 Armstrong LLP LLP 25. Trade Secrets Protection extended to secret, competitiveinformation Once a secret is made public, the trade secret is lost forever Maintained by substantial precautions: Employee awareness Contracts Limited Access on a need-to-know basis25 Examples: Customer lists, supplier lists, secret recipes,financials, unique business techniques, or plans 2013 Armstrong Teasdale LLP 26. Trade Secrets- Strategies and Tips Take the time to identify what needs protection Label materials confidential Limit access on a need-to-know basis Educate your employees Employment Handbook or Employment Contract Set up and maintain policies to protect your trade secrets then make sure your employees follow those policies password protection, secure networks, etc. Use contractual agreements to protect your trade 26secrets Employment agreements, Confidentiality agreements, Non-disclosure agreements, Non-compete agreements 2013 Armstrong Teasdale LLP 27. Contractual Agreements27 2013 Armstrong Teasdale Teasdale 2013 Armstrong LLP LLP 28. Contractual Agreements Confidentiality Agreements Non-Disclosure Agreements Especially important for meetings with investors Development Agreements Assignments Licenses 28 2013 Armstrong Teasdale LLP 29. Employment Agreements Maintain your confidentiality, ownership, and client-base Always remember that new hires may be subject tothe same agreements Non-competes Confidentiality agreement Assignments of rights29 2013 Armstrong Teasdale LLP 30. Corporate Concerns Ownership of Intellectual Property within the Company Contractual Interests vs. Shares Corporate Formalities Document meetings by taking minutes, individualresponsibilities, expenses otherwise you may be personally liable Financing Buy/Sell provisions Outside Investors30 Selling your Company Drag Along and Tag Along Provisions 2013 Armstrong Teasdale LLP 31. Final Thoughts Consider your Intellectual Property protection early Intellectual Property enhances the value of your 31company Investors almost always ask about IP Protection Budget for Intellectual Property Protection Avoid Infringement In all business dealings (employment, investment, even basic corporate formalities), make sure you know who owns, or has rights to use, your intellectual property Consider having an attorney function as part of your team to make sure you are protected throughout the course of your business dealings 2013 Armstrong Teasdale LLP 32. Thank you! Jessica M. Mendez JMendez@ArmstrongTeasdale.com 314.342.4188 Samir R. Mehta SMehta@ArmstrongTeasdale.com 314.342.4125 http://www.armstrongteasdale.com 32 2013 Armstrong Teasdale Teasdale 2013 Armstrong LLP LLP