Deck 17: Licensing Agreements and the Protection of Intellectual Property Rights

Question 1

TRIPS was the result of intensive negotiations during the so-called Tokyo Round of GATT talks and provided increased protection for IPRs during the 1980s.

Answer 1

False

Question 2

The European Union's Commission has jurisdiction over franchise agreements operating in its member countries.

Answer 2

True

Question 3

The great advantage of the International Convention for the Protection of Industrial Property is that by filing a trademark with this international body,the trademark owner achieves virtually worldwide trademark protection.

Answer 3

False

Question 4

Restrictions written into the franchise agreement must be strictly adhered to regardless of the effects it may have on the competitive potential of the franchisee in the host country.

Question 5

U.S.courts have been reluctant to restrict gray market competition in situations where the product's quality being introduced to the home market is indistinguishable from its native counterpart.

Question 6

Licensees of IPRs are generally eager to operate under specific marketing quotas requested by the licensor.

Question 7

Licensors of IPRs are generally wary of offering licensees exclusive rights in a certain geographic area.

Question 8

Foreign laws that require the government approval of a licensing agreement are a form of protectionist policy.

Question 9

Transfer of technology laws are U.S.statutes that require U.S.companies to share their technology and research with firms in the developing countries.

Question 10

Under TRIPS,until a pharmaceutical patent is actually granted,a country has no obligation to protect potential prospective rights (during the pendency of the patent application).

Question 11

Many technology transfer agreements prevent the licensee from selling goods to persons that will bring the product back to the licensor's country for sale in direct competition with the licensor.

Question 12

The European Union has both a common multinational patent application process as well as the individual country processes.

Question 13

IPRs include patents,trademarks,and copyright,but not trade secrets.

Question 14

Governments in developing countries usually encourage the use of licensed intellectual property by diligently enforcing laws designed to protect it from theft or other means of exploitation.

Question 15

Under The Companies Act,only private parties who may "reasonably anticipate" a substantial pecuniary return on an investment must register with the government

Question 16

The hearing for the Walt Disney v.Beijing Publishing Press was held in the United States.

Question 17

It is fairly common for IPR licensors to put geographic and field-of-use limitations on licensees.

Question 18

Most international licensing agreements require the licensee to maintain the confidentiality of the licensor's technology.

Question 19

The greatest protection for a firm's copyrights and patents comes from international conventions and not the local laws of individual countries.

Question 20

IPR transfers from U.S.companies to joint ventures in developing countries often allow U.S.companies to avoid the legal risks and entanglements of direct investment.

Question 21

Many technology owners have avoided introducing technology or technological products into Brazil because:

A) The market has been too weak to support these high-tech products.
B) Technology transfer agreements have been interpreted under Brazilian law so that the original owner loses many rights in the technology.
C) Brazilian taxes on the introduction of technology into the country have been prohibitively high.
D) Spies and foreign agents have been stealing the technology and selling it to the communist countries.

Question 22

Developing countries hardly ever restrict remittances of hard-currency payments to foreign firms because to do so would deprive the firm of foreign investment.

Question 23

If a technology transfer agreement is interpreted under local law as a "sale" rather than as a temporary "lease," then:

A) The licensor will make far greater profits on a sale than under a lease.
B) At the end of the term of the agreement, the licensor will lose rights in the technology in the foreign country.
C) The licensee will be free to resell the technology to firms in other countries during the time the agreement is in effect.
D) Royalty payments will not be permitted to be made.

Question 24

Under TRIPS,a nation may decide to exclude pharmaceutical patents if it determines they are immoral.

Question 25

A field of use limitation in a licensing agreement restricts the licensee's ability to market in certain geographical areas.

Question 26

Which of the following regulatory schemes for technology transfer agreements is most indicative of a protectionist government policy?

A) Preapproval.
B) Notification/registration.
C) No regulation.
D) None of the above.

Question 27

Since 1996,the European Union's Trademark Regulation has allowed a single trademark registration enforceable in all members of the European Union.

Question 28

A single multinational application process is available for protecting intellectual property in:

A) In the U.S., Canada, and Mexico.
B) In the Eastern European countries.
C) In countries that are member of the Asian Patent Protection Treaty.
D) In the European Union.
E) All of the above.

Question 29

Under a bilateral agreement concluded in 1994 between the U.S.and the EU:

A) U.S.-made liquor can be branded as "scotch whisky," or "cognac."
B) EU made liquor can be branded as "bourbon" or "Tennessee whiskey."
C) Both A and B.
D) Neither A nor B.

Question 30

Most nations grant patent priority to the individual who can prove (s)he was the first to invent.

Question 31

The three regulatory schemes for a technology transfer agreement range from least prohibitive to most prohibitive in which of the following choices:

A) Notification/registration, no regulation, preapproval.
B) Preapproval, notification/registration, no regulation.
C) No regulation, notification/registration, preapproval.
D) No regulation, preapproval, notification/registration.

Question 32

Copyright protection for works of authorship available through the Internet is expressly provided by:

A) The Berne Convention.
B) The WIPO Copyright Treaty.
C) The TRIPS Agreement.
D) None of the above.

Question 33

Computer programs are protected as copyrightable literary works under the Berne Convention.

Question 34

Naked licensing results in abandonment of rights in a trademark.

Question 35

When the intellectual property being licensed is technology protected primarily by a patent,a key license provision will be a clause setting forth the licensee's obligation to keep the licensed technology confidential.

Question 36

A licensee will seek a grant back of ownership in improvements to the licensor.

Question 37

A.Bourjois & Co.v.Katzel involved the question of whether Katzel:

A) Was liable to Bourjois for breach of contract.
B) Was liable to the French subsidiary of Bourjois for trademark infringement and counterfeiting.
C) Was entitled to punitive damages for willful trademark infringement.
D) Was liable to Bourjois for trademark infringement.

Question 38

The Paris Convention:

A) Is the seminal patent protection treaty.
B) Requires national treatment for foreign trademark and patent applications from signatory countries.
C) Provides a trademark holder in any signatory country a twelve-month period of priority within which to make similar applications in signatory countries.
D) A, B, and C.

Question 39

Both the Berne Convention and the Paris Convention require signatory countries to enact certain minimum substantive laws.

Question 40

Under U.S.copyright law,an author's moral rights are not protected.

Question 41

Exhibit 17-1
Accuraphoto USA (AUSA) owns the "Accuraphoto" trademark in the United States. AUSA produces the "SureShot" camera, which is known to consumers as a moderately priced quality product. AUSA entered into a contract with Honshu Photographic, Inc. (HPI), a Japanese corporation. Pursuant to the terms of the contract, HPI was permitted to manufacture and market "SureShot" cameras utilizing the "Accuraphoto" trademark in return for payment of royalties based upon a percentage of HPI's sales. After producing "SureShot" cameras for a short time at its Japanese facility, HPI moved production to its facility in the Philippines in order to reduce labor costs. The cameras produced at the Philippine facility utilized the "Accuraphoto" trademark but were marketed under the name "SharpShot." Additionally, these cameras contained improved electronic features incorporated into the product by HPI engineers. Despite the inclusion of these improvements, "SharpShot" cameras proved to be of inferior quality. Furthermore, "SharpShot" cameras have begun to show up on the shelves of U.S. discount retailers such as K-Mart and Wal-Mart. Additionally, several "SharpShot" cameras have been sent by American consumers to AUSA's American facilities for repair. Finally, HPI has refused to share access with AUSA to the electronic improvements incorporated into the "SharpShot" on the basis that they are confidential proprietary information.
Refer to Exhibit 17-1.What remedies may AUSA seek against HPI as a result of its conduct? What do these remedies provide?

Question 42

Transfer agreements in Japan and some newly developed countries such as Korea require:

A) Approval by the government.
B) Negotiation between the foreign licensor and the government.
C) Notification to the government.
D) Assurance that the agreement has not be entered into corruptly.

Question 43

The patent protection treaty that gives a trademark holder in any signatory country a twelve-month period of priority within which to make similar applications in other signatory countries is known as:

A) The Patent Cooperation Treaty.
B) The International Convention for the Protection of Industrial Property.
C) The International Intellectual Property Treaty.
D) The Uniform Copyright Convention.

Question 44

The greatest protection offered to the holder of intellectual property rights comes from:

A) The Paris Convention.
B) The Patent Cooperation Treaty.
C) The Uniform Copyright Convention.
D) Local laws.

Question 45

Assess the relative merits of producing a new product or technology abroad as opposed to domestically.

Question 46

When it seems likely that a licensee may develop improvements in the licensed technology,a licensor may wish to include a ____ in the license agreement.

A) Grant back provision.
B) Field use provision.
C) Technology transfer.
D) Promise of confidentiality.

Question 47

Develop a document that proposes international standards for trademark licensing or use by a subsidiary (or sale to a third party)of copyrighted material.

Question 48

The three types of regulatory schemes for transfer agreements that exist include all but which of the following:

A) Preapproval.
B) Notification/registration.
C) No regulation.
D) All are types of regulatory schemes.

Question 49

Compare and contrast the risks of international licensing to a company versus those associated with trading goods.

Question 50

The TRIPS Agreement:

A) Became effective July 1, 1995.
B) Promises to create a more effective international system for protection of IPRs.
C) Requires every member of the WTO to abide by the Paris Convention and the Uniform Copyright Convention.
D) A, B, and C.

Question 51

The importation of foreign-made trademarked merchandise into the U.S.for sale in competition with the U.S.trademark owner's own merchandise made in the U.S.is referred to as:

A) Copycat competition.
B) Gray marketing.
C) Reverse trade advantage.
D) Black marketing.

Question 52

The concept of language politics in systems franchise agreements refers to:

A) The legal system's primary language must be recognized.
B) A country that requires a certain language to be used to conduct business in a certain region.
C) Efforts to incorporate the home country's language into standard business practice of the host country are extensive.
D) None of the above.

Question 53

Exhibit 17-1
Accuraphoto USA (AUSA) owns the "Accuraphoto" trademark in the United States. AUSA produces the "SureShot" camera, which is known to consumers as a moderately priced quality product. AUSA entered into a contract with Honshu Photographic, Inc. (HPI), a Japanese corporation. Pursuant to the terms of the contract, HPI was permitted to manufacture and market "SureShot" cameras utilizing the "Accuraphoto" trademark in return for payment of royalties based upon a percentage of HPI's sales. After producing "SureShot" cameras for a short time at its Japanese facility, HPI moved production to its facility in the Philippines in order to reduce labor costs. The cameras produced at the Philippine facility utilized the "Accuraphoto" trademark but were marketed under the name "SharpShot." Additionally, these cameras contained improved electronic features incorporated into the product by HPI engineers. Despite the inclusion of these improvements, "SharpShot" cameras proved to be of inferior quality. Furthermore, "SharpShot" cameras have begun to show up on the shelves of U.S. discount retailers such as K-Mart and Wal-Mart. Additionally, several "SharpShot" cameras have been sent by American consumers to AUSA's American facilities for repair. Finally, HPI has refused to share access with AUSA to the electronic improvements incorporated into the "SharpShot" on the basis that they are confidential proprietary information.
Refer to Exhibit 17-1.What terms could AUSA have included in its contract with HPI that could have avoided this legal morass?

Question 54

Intellectual property rights in some countries are not protected because:

A) Some countries actually encourage their citizens to violate the property rights of foreigners because it is economically advantageous to do so.
B) Some countries that have intellectual property laws fail to enforce them.
C) Some countries enforce their intellectual property laws in a discriminatory fashion.
D) All of the above.

Question 55

The type of arrangement in which the licensor permits the licensee to sell certain goods under the licensor's trademark or logo is called:

A) Trademark lease agreement.
B) Shared benefit agreements.
C) Franchise agreement.
D) None of the above.

Question 56

TRIPS requires every member of the World Trade Organization to:

A) Abide by the Paris Convention.
B) Abide by the Berne Convention.
C) Apply national treatment to foreign owners of intellectual property rights.
D) Provide patent protection for processes.
E) All of the above.

Question 57

Compare and contrast TRIPS with IPR in the U.S.or another country (for example,India).

Question 58

Among the recent legal and technological issues reported in the WIPO magazine available on-line,which do you believe are the most important for the U.S.? Assess their relative importance to other countries.

Question 59

Common restrictions imposed on the use of technology include geographic limitations on the licensee's manufacturing and/or marketing activities.These types of restrictions are also known as:

A) Field of use limitations.
B) Non-technical limitations.
C) Operating limitations.
D) Implied effort of cooperation limitations.

Question 60

Compare and contrast attitudes toward technology transfers in the developed countries,developing countries,and countries strongly influenced by Marxist ideology.

Question 61

Draft a bill to address the problem of gray market goods (or that enacts the Lever Rule -- students will need to do outside research regarding the Lever Rule).

Question 62

Create the structure or standards for an on-line international dispute resolution forum handling IPR issues.