Intellectual Property

The Most Overlooked Mistake That Can Kill Your Company Before It Starts

Most founders assume their company owns what it builds. It doesn’t, at least not automatically.

Under U.S. law, the person who creates intellectual property owns it unless they’ve assigned it in writing. That means your company may not own its core code, designs, or brand even if you paid for them.

I’ve seen financings delayed, acquisitions fall apart, and founders lose control of their own products because they never secured clear IP ownership. It’s the single most common, and most avoidable, legal mistake in early-stage companies.

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The year 2025 left the media and entertainment industry with a series of significant, unresolved legal questions. As we move into 2026, several high-profile cases are poised to redefine the boundaries of fair use, the legality of AI training, and the application of the Rogers Test in trademark law.

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In a recent en banc decision, the Federal Circuit Court of Appeals has overruled its prior test for nonobviousness of design patent inventions, holding that design patents are subject to the same test as utility patents.  LKQ Corporation v. GM Global Technology Operations (Federal Circuit, May 21, 224).

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On April 19, 2024, the United States Patent and Trademark Office (USPTO or Office) issued proposed modifications to the rules of practice for inter partes review (IPR) and postgrant review (PGR) proceedings before the Patent Trial and Appeal Board (PTAB or Board).

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In the realm of copyright law, determining the scope of damages and the applicability of the statute of limitations remains a contentious issue. The Supreme Court case of Nealy v. Warner Chappell Music (argued before the Court in February of this year) promises to shed light on this matter, grappling with the question of how far back a plaintiff can seek damages in a copyright infringement case. This pivotal legal battle has significant implications for copyright holders, defendants, and the broader creative industry landscape.

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OpenAI, Inc. develops artificial intelligence software involving large language models (“LLM”) known as ChatGPT.  In 2023, several authors, including the comedian Sarah Silverman, filed putative class action lawsuits alleging various copyright infringement claims. On February 12, 2024, a District Court in the Northern District of California issued its Order and ruled on the OpenAI defendants’ motions to dismiss various claims in the two pending putative class action lawsuits.

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The Federal Circuit Court of Appeals has struck down many patents on the grounds that they are invalid as directed to an abstract idea, relying on the Supreme Court’s Alice decision.  In In re Elbaum (Fed. Cir. 12/20/2023) 2023 U.S. App. LEXIS 33719, the Federal Circuit affirmed the Patent Trial and Appeal Board’s rejection of the claims in a patent application as directed to an abstract idea.

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On February 12, 2024, the United States Patent and Trademark Office (“USPTO”) issued guidance on the patentability of inventions developed with the assistance of artificial intelligence, saying that a human must have made a “significant contribution” to the invention. The USPTO explained that while AI-assisted inventions are not categorically unpatentable, the inventorship analysis should focus on human contributions, as patents function to incentivize and reward human ingenuity. Thus, patent protection may be sought for inventions for which a natural person provided a significant contribution to the invention, and the guidance provides procedures for determining the same.

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