Darin M. Klemchuk 7/3/17 Darin M. Klemchuk 7/3/17

Intellectual Property Protection for Fireworks

Every July 4th, we celebrate an American tradition with food, friends, family, and, of course, fireworks. While fireworks are generally easy to procure, depending on what state you are in, few know about the surprisingly high amount of intellectual property challenges that fireworks manufacturers and vendors face today. The following discusses the IP challenges as well as forms of intellectual property protection for fireworks.

Google Prohibits Online Advertising for Fireworks

One of the first challenges comes from advertising online. While fireworks are a popular search term online, keen observers might notice that searches for fireworks do not yield top hits for vendors and online stores like most search results would. Similarly, fireworks never appear in targeted or paid ads on popular search engines like Google or Bing.

The reason for this comes from Google’s legal policies. In its AdWords legal policies, Google explicitly states that they will not promote fireworks in targeted advertising because fireworks and pyrotechnic devices are considered too dangerous to promote. As such, Google’s AdWords partners, like AOL, are similarly limited by such policies.

To get around these rules, fireworks advertisers use many creative workarounds. One popular workaround is to spell “fireworks” differently. In some advertisements, the keyword for “fire-works” is spelled incorrectly with a hyphen. Firework vendors also commonly run ads selling “party favors” or rely on consumers to search for their products under specific brand or product names such as “Black Cat” or “Roman Candles.”

In contrast, another intellectual property challenge that is fireworks-related concerns copyrights of firework shows. From the Fourth of July to the Olympics, fireworks often take center stage at large, public events. As such, some artists have attempted to copyright their firework shows.

Responding to these requests, the U.S. Copyright Office states that they will review each request on a case-by-case basis. Because visual arts must be in a tangible medium of expression to qualify for copyright protection, many artists rely on registering copyrights of photographs or video-recordings of their fireworks show. Since the firework display itself is not considered fixed, the fireworks show as a concept is not registerable.

Beware of Copyright Violations in Music During Fireworks Shows

Artists must also be mindful of the music they choose to accompany their fireworks shows. To avoid paying expensive licensing or royalty fees, artists either rely on music in the public domain or work with local radio stations to coordinate musical accompaniment. If the artists rely on a radio station to provide the music, radio stations simply need to adhere to blanket licenses they have already agreed to in order to air the display’s music.

Similarly, many tourist destinations, theme parks, or other fireworks shows rely on using original musical works to accompany their shows. This way, the organizers can avoid paying any type of royalties for the music and dodge claims of copyright infringement.

Patent Protection for Fireworks

Another route commonly used to protect fireworks is patent protection. Several patents have been issued to register the design of specific fireworks. For example, the Walt Disney Company owns several firework patents, including patents that cover distinctive shell configurations. These configurations cover fireworks that create specific shapes or designs in the sky that are representative of the Walt Disney Company.

Trademark Protection for Fireworks

Lastly, trademark registration also provides a popular source of intellectual property protection for fireworks manufacturers. Most fireworks companies pursue registration of specific brands or logos associated with their products to protect their goods from infringement. The real challenge, however, often comes from knockoffs or counterfeit goods from China. Many fireworks brand owners often encounter difficulty with policing their fireworks brands online due to the online ban of advertising on search engines. Similarly, many foreign companies often illegally use trademarked images on their fireworks products but often face little to no repercussion due to the sheer number of fireworks trafficked or sold.

In the end, the practice of selling fireworks faces unique intellectual property challenges. Fortunately, fireworks vendors have a number of solutions available to gain intellectual property protection for fireworks and to help navigate the challenges they face both legally and responsibly.

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In addition to Thriving Attorney, Darin M. Klemchuk is founder of Klemchuk LLP, a litigation, intellectual property, and transactional law firm located in Dallas, Texas. He also co-founded Project K, a charity devoted to changing the world one random act of kindness at a time. Click to read more about Darin Klemchuk's practice as an intellectual property lawyer.

Darin M. Klemchuk 7/3/17 Darin M. Klemchuk 7/3/17

Intellectual Property Indemnification - Generally

Indemnity clauses (sometimes referred to as hold harmless clauses) are common in agreements where one party wishes to shift certain risks to another party. In intellectual property indemnification clauses, the risk is commonly associated with patent infringement, trademark infringement, copyright infringement, trade secret misappropriation, software issues, or some other intellectual property (IP) related risk. An indemnity clause may be limited to indemnification or it may also include the obligation to "defend" and/or "hold harmless." Intellectual property indemnity clauses are particularly dangerous to vendors because the costs to defend a typical IP claim could far exceed the payments to the vendor under the agreement.

Intellectual Property Indemnification - Representations and Warranties

Indemnification clauses often incorporate representation and warranties, which serve as additional grounds to trigger an indemnification obligation. For example, purchasers or licensors of software frequently include a representation and warranty that the software deliverable will be free from third-party claims and further that no materials owned by a third-party or for which the developer does not have permission have been incorporated into the software deliverable. Later, if a third party makes a claim for copyright infringement, the purchaser/licensor will seek to take advantage of the indemnification clause and force the developer to defend the claim and pay for any damages or settlements.

Intellectual Property Indemnification - Limits on Liability

Because the potential liability for indemnification obligations, particularly for IP indemnity claims, can be so high, vendors will typically attempt to limit or cap their liability. One way this can be accomplished is including a limitation of liability clause in the agreement and expressly applying that clause to the indemnification clause. For example, if the agreement provides a $50,000 fee to the vendor to develop and deliver a software solution, the vendor could likely be liable for significantly more if it is required to defend a third-party copyright infringement claim. However, if the limitation of liability clause limits the vendor's total liability to payments received under the agreement and that limitation applies to the indemnification clause, then vendor's liability is potentially capped at $50,000 even though the litigation over the claim could costs $100,000s. Many purchasers with leverage will demand unlimited or uncapped intellectual property indemnification. A potential compromise is for the purchaser and vendor to agree that the indemnification liability will be capped at some multiple of the vendor payments under the agreement.

Interested in learning more about intellectual property indemnification, see our blog posts and articles related to indemnification clauses and agreements in general as well as other content on patent indemnification, trademark indemnification, copyright indemnification, trade secret indemnification, and software indemnification.

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Darin M. Klemchuk 6/23/17 Darin M. Klemchuk 6/23/17

Fired for Social Media at Work?

With social media becoming an increasingly substantial part of normal day to day operations, the line between an individual’s personal, private social media profile or blog and the individual’s work life has blurred. More and more, reports of employers disciplining or terminating employees based on the employee’s Facebook posts or pictures, Tweets or blog posts. Read more here.

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