Page 182 - Business Principles and Management

Chapter 7 • Legal Aspects of Business

Copyrights are regulated by the federal Copyright Office. Like a patent, a
copyright is a special type of monopoly granted to authors, publishers, and other facts
creators of original works. An example of a copyright notice appears on the back &
of the title page in the front of this book.
figures

TRADEMARKS
Trademarks are like patents because they are special types of monopolies. A Trademark rights may continue
trademark is a distinguishing name, symbol, or special mark placed on a good indefinitely, as long as the mark
or service that is legally reserved for the sole use of the owner. Many nationally is neither abandoned by the
known products have trademarks that most people recognize. Some trademarks trademark owner nor loses its
are symbols, such as the Nike “swoosh” or the McDonald’s “golden arches.” significance in the marketplace
Others are company or product names, such as the Sony “Walkman” or Nin- as a trademark by becoming
tendo’s “Game Boy.” Trademarks, like patents, are regulated by the Patent and a generic term. For example,
Trademark Office. the generic terms escalator,
linoleum, and zipper were
once trademarks.
CHECKPOINT
Describe the three areas of intellectual property protection.

Regulations Protecting the Public

The federal government protects the legal rights of not only those who create new
products and ideas but also those who consume goods and services. Two major
goals of legislation are to ensure safe products for consumers and to prevent the
misuse of information.

FOOD AND DRUGS
Products related to the human body are closely regulated. The Food and Drug
Administration (FDA) administers the Federal Food, Drug, and Cosmetic Act
and related laws. These laws prohibit the sale of impure, improperly labeled,
falsely guaranteed, and unhealthful foods, drugs, and cosmetics. Producers
of cosmetics, for example, must show that their products will not harm users.
Should a product cause harm, the FDA may require the producer to stop its
sale or to notify the public of its possible danger.

NONFOOD PRODUCTS

Legislative activity dealing with the safety of nonfood products has increased in
recent years. Laws now require labels on many products if possible danger exists
from product use. A health warning message, for example, must appear on ciga-
rette packages. The FTC forbids the sale of tobacco and smokeless tobacco to
those under 18 because research shows that the majority of those who smoke
when young die prematurely of smoking-related diseases. Also, auto and high-
way safety laws exist to reduce death and injury.
The Consumer Product Safety Act sets safety standards on many items. When
products already sold are found to have a dangerous defect, businesses are legally
required to recall, repair, or stop selling the products. Dangerous toys, for example,

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