Trade Secrets

Published On November 18, 2012 | By MoniqueE2E | Digital Journalism, FullSail Articles

 

SHHHHHH!  It’s a Secret

By: Monique Gaudin

Stan Allen – Creator, editor and publisher of Magic magazine. A magician himself, claims no legal expertise on the subject of copyright and trade secrets, but speaks from 27 years of reporting magic news.                       Photo: Monique Gaudin

“It’s tricky,” says Stan Allen, creator, publisher and editor of Magic magazine, about protecting the performance or a specific trick in a magic act.  “To use a bad pun, it’s very tricky because, magic isn’t big enough for the courts to establish precedence, and law.”

A magician himself, Mr. Allen wrote, What Do We Do Now? in the 1998, February edition of Magic magazine, discussing the legal options magicians had, in the wake of the Fox show; Breaking the Magician’s Code: Magic’s’ Biggest Secrets Finally Revealed. “The thing I hated the most about it wasn’t that they were giving away secrets.  No, they were demeaning the whole art.  And, there were lots of magicians, that seemed to feel at that point they couldn’t continue in their jobs, because their tricks were all exposed, and no one would want to see their stuff.”

The Fox Television series featuring a “masked magician” exposing magic secrets in 1997-2002 effected magician’s livelihood worldwide. Stan Allen, editor and producer of Magic magazine wrote an article in February 1998 informing the community of possible recourse in protecting their “tricks.” Photo: Monique Gaudin

In the world of live performance, such as in that of magicians, the laws of copyright and patents, leave them very little, if any, protection over their act.

In a 2008 article in BBC News Magazine, Can you copyright a magic trick?, magician, and intellectual rights lawyer, Guy Hollingworth stated; “The crux of the problem is this – magic is about dark arts and mystery. Whereas codifying something in law tends to mean setting it down in black and white, for anyone and everyone to pore over should they so desire.  An idea alone cannot be covered by law, and so simply inviting someone to choose a card, for example, and then making it appear in a wallet, is not something the law can or will protect.”

“The problem is, when it’s the invention of a new trick,” says Mr. Allen.  “There is the method; How was it accomplished? And the basic “effect” of; a woman floated up into the air.  We can see her floating in the air. That’s the effect. I’ve been told it’s virtually impossible to protect the effect.”

So what can magicians do to protect their secrets? “What you can protect to a certain degree is the method,” states Mr. Allen.  But expecting an outcome favoring the magician is still not a realistic one as “the laws in this country protect competition.  They protect free trade.”

To a limited extent, you can protect your method and performance under Intellectual Property (IP).   The Intellectual property rights include patent, copyright, trademark and trade secret rights.

In the United States, the ability to protect Intellectual Property originates in written form in the US Constitution; Article 1, Section 8, Clause 8: “To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”

That Constitutional right is impetus of today’s Intellectual Property laws.  The filling of a patent, being the, perceived, main choice of action.  The Patent process however, is a costly, and lengthy one; requiring full disclosure of all aspects of an invention.  Once filed, the blueprints can be obtained for a nominal fee. The purchaser in turn, can legally copy the essence of the work, by altering a few items.

“A patent is quid pro quo for disclosure: You receive protection, and as a result the application is open to the public. You lose any secrecy you had.” Discloses Alexander Poltorak, founder and CEO of General Patent Corporation, an intellectual property firm that focuses on IP strategy, valuation, licensing, and enforcement In Best Way to Protect Your Brilliant Ideas in the July, 2012 issue Inc. Magazine.

Where magic is concerned, if one person has improved on another’s work, “the audience doesn’t know the difference, because it’s a secret method.  So, patents really do not help the magician.  In fact in some methods, they hurt the magician, because what is critically important, is the secret of it,” says Mr. Allen.  “It’s not critically important from the standpoint of we know something that you don’t know, but you don’t want to fill them in on all the details. Most magicians will watch any effect, and they will have a general idea of how it is done.  But they don’t know all the nuances, and all the little twists.” Using someone else’s patent could provide a shortcut to years of trials, and errors.

The copyright is another means of protecting your Intellectual Property. “When you say copyright, you general think of the written word.” Says Stan Allen.

Copyright is a legal device that provides the creator of a work of art or literature, or a work that conveys information or ideas, the right to control how the work is used. In applying copyright to magic, the application becomes difficult. To prove copyright on a magic trick or performance, it would have to clear three areas of protection:

  1. “A work must be “fixed in a tangible medium of expression.” This means that the work must exist in some physical form for at least some period of time, no matter how brief.”
  2. The work must be original — that is, independently created by the author.
  3. A work must be the result of at least some creative effort on the part of its author.

Again, this is difficult to prove in a court of law for magicians.  “The idea of floating the person in the air is not something that you can say; “Hey, I’m going to float someone in the air, so no one else can float someone in the air,”  says Mr. Allen.  If that was the case, the first person to say, “I have four wheels, a metal chasse, and an engine, and I call it an automobile.  And nobody else can make an automobile.” Well no!  Everybody else can make an automobile; they just can’t use the exact design that you have used.”

Robert E. Rice, creator of The Mystery Magician, lost in the 9th Circuit, United States Court of Appeals, after asking the court to legally “weigh” the facts to decide whether his copyrighted video could “sustain an infringement claim against a television network for its broadcast of a program revealing the secrets of professional magicians.”

The court deemed; “In order “[t]o establish infringement, two elements must be proven:

(1) ownership of a valid copyright, and
(2) copying of constituent elements of the work that are original.”

In doing so, the court had to distinguish between what was protected and unprotected material.

The cliff notes on the ruling was a rejection of copyright infringement based on: “similarities derived from the use of common ideas cannot be protected;  otherwise, the first to come up with an idea will corner the market.” And, “that the magician in his video is an “especially distinct” character differing from an ordinary magician in a manner that warrants copyright protection.”

Another possible avenue in asserting copyright for magicians, is the use of “pantomime.”  Harry Houdini reputedly used this method, and it’s legal weight is currently being tested by Teller, the silent partner of magic’s Penn and Teller.  He is suing Dutchman Gerard Dogge in the Nevada district court, for allegedly posting his creation, “Shadows” on YouTube, and offering to reveal the method for $3,500.00 to any buyer. Upon the creation of his trick, Teller wrote, and filmed a play, in which he described, in vivid detail, all the elements of the performance of the trick.  A performance, which is still today, a signature piece.

In the defining of the use of pantomime for copyright, the USLegal site offers: “Choreography is the composition and arrangement of dance movements and patterns usually intended to be accompanied by music.  Pantomime is the art of imitating or acting out situations, characters, or other events.  To be protected by copyright, pantomimes and choreography need not tell a story or be presented before an audience. Each work, however, must be fixed in a tangible medium of expression.

Pantomime: The work may be embodied in a film or video recording or be precisely described in text or on a phonorecord.

Choreography: The work may be embodied in a film or video recording or be precisely described on any phonorecord or in written text or in any dance notation system.

In the alternative, the author can also use a written description of the work such as a dance notation system, like Labanotation, Sutton Movement Shorthand, or Benesh Notation.”

How this approach holds up in court, will undoubtedly unfold over the next year with the outcome of Teller’s case in district court.

The remaining legal approach in protecting your Intellectual Property is the trade secret.

Unlike other forms of Intellectual Property such as patents, copyrights, and trademarks, trade secrets cannot be registered with the government to protect proprietary information.

Only in keeping the information confidential can the trade secret be protected.

The standard bearer for the effectiveness of this legal option is Coca-Cola and Kodak.  In fact, Coca-Cola is so famous for their success in protecting their 125-year-old formula, they are currently promoting their product anew: “By sharing this secret formula experience with our consumers.”  They are still not revealing the secret, but have built a whole interactive experience around; the protecting of the secret.  And this element, protecting the secret, is the most critical component in successfully using the trade secret.  Keep it a secret.

In accordance to the UTSA, there are six factors to be considered in determining whether information constitutes a trade secret:

1. The extent to which the information is known outside the claimant’s business

2. The extent to which it is known by employees and others involved in the business

3. The extent of measures taken by the claimant to guard the secrecy of the information

4. The value of the information to the business and its competitors

5. The amount of effort or money expended by the business in developing the information

6. The ease or difficulty with which the information could be properly acquired or duplicated by others

And in filing a claim three essential elements:

  1. The subject matter involved must qualify for trade secret protection; it must be the type of information trade secret was intended to protect, and it must not be generally known.
  2. The holder of the trade secret must establish that reasonable precautions were taken to prevent disclosure of the secret information.
  3. The trade secret holder must prove that the information was wrongfully acquired by another; that the information was misappropriated.

To protect your interests, a summery of the recommended action to take put simple are:

  • Clearly mark all documentation about the trade secret with confidentiality warnings. This act alone is stated as the most obvious oversight.
  • Restrict access to the information to only those who have a reason to know it.
  • Make all holders of the trade secret (or even part) sign a non-disclosure agreement (NDA). This should take place prior to the revealed information. Additional recommendations are to reinforce the seriousness of the document, by signing and dating the agreement annually, or with every performance.
  • Keep physical trade secret information in a restricted and secured area. If, a prop, gimmick or blueprint, lock it up.
  • Maintain dated proof of creation of your trade secret. This can be done as Mr. Allen states; “was done in the old days; you could mail it to yourself, with a signature. That envelope is sealed and it’s dated by the post office. It is stamped, its put away, and there is your evidence that when you wrote it.”

The increasing use of trade secret law in court cases in today’s current electronic super war of producing the best electronics, games, or gadgets, is changing the verbiage of application state by state as they expand upon the Uniform Trade Secrets Act.  A change, depending upon your state’s application there of, could provide a great berth of protection for magicians.  The elements of creating online games, using a series of code, not of original creation, is in delivery, not so far removed; from a magician creating a an act, from a series of tricks, that are of common knowledge, to all scholars of prestidigitation and illusion.

California ruled in 2003 ”You don’t have a First Amendment right to spill everybody’s trade secrets.”  As Stan Allen says; “we live in a; “we have a right to know everything”, “That there are no secrets.”  Well no, you actually don’t have the right to know that, but the assumption is in our society, that we do.”  Case law is changing, to define where the lines of “right to know” are drawn with the ruling in each new case.  Now that computer companies and electronic manufacturers have millions on the line, protecting the “Intellectual Property” of the trade secret is becoming, a valuable commodity.

Post note:

The most prudent avenue, in writing a Non-Disclosure Agreement, is to hire a lawyer, with the legal expertise in the field of Trade Secrets and Intellectual Property.  But if you do plan on drafting up an NDA without the professional assistance, due diligence, and research would always be best practices.

Here are a few links to samples of Non-Disclosure Agreements (NDA) for starters:

http://www.nolo.com/legal-encyclopedia/patent-copyright-trademark

http://www.nolo.com/products/nondisclosure-confidentiality-agreement-pr111.html

http://www.ndasforfree.com/NDAS/GetBasic.html

http://www.chillingeffects.org/tradesecret/resource.cgi?ResourceID=89

http://www.bitlaw.com/forms/nda.html

http://www.bizfilings.com/toolkit/tools-forms/run-a-business/govt-contract-forms/nondisclosure-agreement-template.aspx

 

Monique Gaudin is a professional television editor, educator, entertainer, and an online instructional designer. Currently, she is completing a Masters of Arts in New Media Journalism at Full Sail University, and working fulltime, developing interactive, online curriculum. 

 

References:

http://caselaw.findlaw.com/us-9th-circuit/1047100.html

http://news.bbc.co.uk/2/hi/uk_news/magazine/7722521.stm

http://www.inc.com/jeff-haden/patents-trade-secrets-licensing-protecting-ideas.html

http://blogs.findlaw.com/celebrity_justice/2012/04/teller-the-silent-of-penn-teller-sues-over-magic-trick.html

http://www.esquire.com/features/teller-magician-interview-1012-2

http://copyright.uslegal.com/enumerated-categories-of-copyrightable-works/choreographic-and-pantomimes-works/

http://www.coca-colacompany.com/stories/the-secret-is-out-coca-colas-formula-is-at-the-world-of-coca-cola

http://www.archives.gov/exhibits/charters/constitution_transcript.html

http://corporate.findlaw.com/litigation-disputes/what-is-intellectual-property-trade-secret-law.html

http://allthingsd.com/20121014/zynga-files-suit-against-former-staffer-claiming-theft-of-trade-secrets/?KEYWORDS=trade+secrets

http://articles.chicagotribune.com/2012-08-31/business/ct-biz-0830-moto-theft–20120831_1_trade-secret-case-hanjuan-jin-trade-secrets

http://btlj.org/2012/04/02/recent-developments-in-trade-secret-law/

http://www.law.cornell.edu/wex/trade_secret

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