Gravitas Blog

This is a continuation of the previous post on Copyrights & Design.  To see the beginning of this, please click here.

For willful copyright infringement, the infringer must have access to the original information.  Willful infringement carries much larger penalties.  Crying “fair use” is a defense in case you are being sued.  It is not a get out of jail free card, and if you are invoking it, that means you have already been sued.  Not a good thing.

Currently, applications for a copyright cost $45 for the filing.  Typically, if there are many items to be protected, such as photographs, or in our case, plans, they can be submitted in one application.  These are then called a collection.  The caveat is that they all have to be published on the same day.

Trademarks

A trademark is an indicator of source.  It shows where a product, design, image was created.  The Nike swoosh connotes who made the apparel.  Words, logos, sounds, colors, scents can all be trademarked.  For instance;

• Sounds such as Intel’s 4 tone jingle identifies it as coming from Intel
• UPS’s brown is highly identifiable on the road
• There is scented embroidery thread that ties back to where the product is from

A trademark has to be distinctive.  A person knows something came from somewhere.  If it represents a description of a product, and is not distinctive, it can not be trademarked.  Here is a “continuum of strength” regarding the ability to trademark something, from least enforceable to greatly enforceable:

1. Generic Descriptive – “Orange Juice”
2. Merely Descriptive – “Sweet”
3. Suggestive Trademark – “Circuit City”
4. Arbitrary Use – “Apple”
5. Coined Terms – “Unisys”

Phrases can also be trademarked.  “You’re Fired” indicates the source, in this case, Donald Trump.  If you can directly tie it back to where it came from, there is a possibility to trademark the material.  Your rights come from use of the item in question, not by registering it.  If it isn’t out there, you don’t have a case.  Senior users are presumed by the Trade Mark Office to be the first ones to file it.  They are considered the original user.  When you register a Trademark, the Trademark office then becomes the policeman.  That office will deny registration if there is a previous occurrence of it in their files.  Registration is usually geographic in scope.  You can register it with your local government, or if you go through the Federal office, it covers the entire nation.

When the Trademark office is reviewing a new submittal, they look at likeliness of confusion.  Would a consumer be confused?

1. How similar are the 2 trademarks, sights, sounds, meanings
2. Is there a similarity in goods and services?

Incorporation of a trademark with the secretary of state provides no protection.  It all comes down to how it is used.

This is a Federal Trademark.  It is registered with the Federal Government, and you have senior user rights.

You consider this to be a Trademark.  This is simply stated by the individual, or company.  No other action is necessary.  It’s a viewer beware notification not to use this without proper credit.

This is a quick summation of what we learned at Stephen Nipper’s presentation last month.  This is by no means a legal representation of what Copyright, and Trademark is, or can do for you.  We find it necessary in our industry to have a basic understanding of what our rights are, and what we need to be watchful of.  I encourage you to contact a lawyer in your area if you have any further questions on this matter.

>Mark

One issue that we constantly run into while designing custom homes, is copyright.  We go to great lengths to respect the hard work individuals, and companies have invested in the creation of their designs.  We often have clients come to us with plans ripped from magazines and they say they want this kitchen, or this exterior.  This is where we have to inform them that we can’t just rip an idea off, or just change it 17%, and we’re okay.  It is our responsibility to educate the client on the law, and create an artistically, and intellectually unique design, that does not rely on some else’s work.

I recently had the pleasure to attend a presentation by Boise based attorney Stephen Nipper presented by the local chapter of AIGA American Institute of Graphic Arts¹.  While the specifics of the presentation had to do with Graphic Design and the like, the underlying law for it, and for architectural design is the same.  I will split this post into two.  Being a lawyer, we covered a lot of ground in the hour long presentation.  In summation, here is what I learned:

When a client hires our company to design their home, what is purchased is basically the paper that the design is printed on, with the lines on the page.  That is, unless the “artistic content” is sold as defined in the contract with that client.  I will run down with you my understanding from Stephen Nipper.  In his preamble, he was quick to point out that this was not legal advice, and your particular circumstance may vary, but by and large, it is good information.

Copyrights are created at the instance it is fixed in a tangible medium.  A mark or registration is not necessary.  If you do register the plan, you need to do it before it is published, or within 90 days after it appears in “print” (publishing electronically is considered the same as the printed page).  If the plan is registered, it enables you to seek higher statutory penalties, if an infringement occurs.  Damages range from $750-$30,000 (and $100,000 if it is a willful infringement).  You can also collect the attorneys fees associated with protecting the copyright.  If the plan is not registered, then you have to show what the loss/gain is.  This can be much more difficult to prove.  A registration creates a public record, and puts everyone on notice that you consider this to be proprietary information.  A registration also must occur before a suit is filed.

The designer of a plan is by default the owner of it (except if the designer is an employee, then the company owns the copyright), unless it is changed by the contract, or is a “work for hire” situation.

Copyright is referred to as a “bundle of sticks” situation, where each of the following rights exist independently, and need to be addressed separately.  Copyright includes:

1. Derivative rights: manipulating the design in such a way as to create something new.
2. Distribution rights: rights to print, sell, or otherwise distribute the plan
3. Performance rights: right to perform the copyrighted material in public (on hold music)
4. Display rights: right to display the copyrighted material in public (in a lobby, for instance)
5. Right to Reproduce: duplication of the plan either singularly, or in multiple copies

Ignorance of the fact there is a copyright in place is not insulation from lawsuit for infringement.  The largest thing to change though, is the magnitude of the penalties.  If it can be proven that there is ignorance to the existence of the the previous plan, then of course willful infringement is not on the table.  Also, there is a maximum of $200.00 per infringement, versus the $750-$30,000 penalty.  Also, just because you don’t make a profit on stealing someone else’s design, does not mean you can’t be sued for the damages that the copyright holder experiences.

The idea that if a plan is changed X%, it no longer is copyrighten by the original designer, is a myth.  We often hear that if you change some designers plan by 17%, it’s okay to use.  I don’t know where that number came up, but I’ve heard it more than once.  The definition that is used by the court is if the two designs are “Strikingly Similar.”  That injects a degree of subjectiveness to the interpretation.  So care must be taken, if you use a plan as inspiration, that it is not only noticeably different, but that it is not strikingly similar.

Typically, a copyright lasts for the length of the authors life, plus 70 years.  I am not sure how this works in regards to a company, or 25 years from publication, or 125 years from creation.

I’ll finish up what I learned on the next post.  All in all, an educational experience.

>Mark

Here is a good summary of the tax credits for green updates to your home. I really like the fact that the major solar upgrades can be placed in service as late as 2016. By this time solar will be much more prevalent and the costs should come down considerably. Couple that with “no cap” on the 30% off and we all should be able to get into solar for a reasonable rate, not to mention rate of return. Also a credit that I hadn’t absorbed the impact of yet was the roofing. A credit for roofing materials if you make the right decision? Get paid for helping reduce heat island effect? Sounds like a wise decision to me.

By The Charleston Gazette, W.Va.

Jul. 5–CHARLESTON, W.Va. — Homeowners making improvements to their houses to save money on energy bills can take advantage of tax credits that will save even more. When President Obama signed into law the American Recovery and Reinvestment Act of 2009, also known as the “stimulus bill,” the act extended credits to homeowners who made improvements for energy efficiency.

The improvements must be “placed in service,” or ready and available for use, from January 2009 through Dec. 31, 2010. They must be for the taxpayer’s principal residence, except for geothermal heat pumps, solar water heaters, solar panels and small wind energy systems (where second homes and rentals qualify). Tax credits are available at 30 percent of the cost, with $1,500 as the maximum total amount that can be claimed in 2009 and 2010, except for those items listed above and fuel cells. These items are not subject to the cap, and are in effect until 2016.

Home improvements must have a Manufacturer Certification Statement to qualify, and homeowners need to save receipts and the certification statement for their records. Improvements made in 2009 will be claimed on 2009 taxes (filed by April 15, 2010) using IRS Tax Form 5695.

Qualified homebuilders building new homes can qualify for the tax credit for geothermal heat pumps, photovoltaics, solar water heaters, small wind-energy systems and fuel cells, but not the tax credits for windows, doors, insulation, roofs, HVAC or nonsolar water heaters.

There is no upper or lower limit on income for the credits; however they are “nonrefundable,” which means a tax filer can’t get more money back in tax credits than they pay in federal income taxes. Also, with multiple improvements, only a maximum of $1,500 over the two-year period of 2009-2010 is available.

“Basically, you can spend up to $5,000 during this two-year period on a single or multiple improvements, and get 30 percent or $1,500 back as a tax credit. If you get the entire $1,500 credit in 2009, then you can’t get anything additional in 2010,” according to the government’s Energy Star help line.

Two or more unmarried people living in the same home who own it jointly each are eligible for the tax credit on the amount of money they each individually spend to make home improvements and file separate tax returns. If a couple has $10,000 of tax-credit-eligible expenses (so they could get a total of $3,000 in tax credits as opposed to just $1,500), they may want to run the numbers to see if filing separately this year will be more beneficial than filing jointly.

Homebuilders are eligible for a $2,000 tax credit for a new energy-efficient home that achieves 50 percent energy savings for heating and cooling over the 2004 International Energy Conservation Code and supplements. At least one-fifth of the energy savings must come from building envelope improvements. This credit also applies to contractors of manufactured homes conforming to Federal Manufactured Home Construction and Safety Standards.

Here’s a list of improvements, all available for a tax credit of 30 percent of the cost, up to $1,500. For specifications, visit :

Insulation: For insulation to qualify, its primary purpose must be to insulate (for example, insulated siding does not qualify). Adding insulation to your home is covered.

Window and doors: Not all Energy Star-labeled windows, skylights and exterior doors qualify for tax credits, so check the Web site before buying.

Roofing: Metal roofs and reflective asphalt shingles that meet Energy Star requirements are eligible. The credit is for the cost of the roofing materials only; installation or labor costs are not eligible. Roof coatings are not eligible.

Reflective roofs are not for everyone. They will provide the most benefit in sunny climates where you are using your air conditioner a lot. If your house is already shaded and the roof is not exposed to much sun, then a reflective roof may not provide a significant benefit. The benefits also will be lessened if the attic space is well insulated.

HVAC: This includes upgrades to qualifying Energy Star central air-conditioning units; air source heat pumps; natural gas, propane or oil furnaces; gas, propane or oil water boilers; or advanced main air circulating fans.

Water heaters: All Energy Star gas tankless water heaters qualify. There are currently no Energy Star-qualified gas storage tank or gas condensing water heaters that qualify. All Energy Star electric heat pump water heaters qualify.

Biomass stove: The law defines “biomass fuel” as any plant-derived fuel available on a renewable or recurring basis, including agricultural crops and trees, wood and wood waste and residues (including wood pellets), plant (including aquatic plants), grasses, residues and fibers. A comprehensive list of qualified biomass stoves isn’t available, so to verify tax credit eligibility, check the Manufacturer’s Certification Statement prior to purchase.

The following items do not have the $1,500 cap and have a “placed in service” deadline of Dec. 31, 2016:

Geothermal heat pump: All Energy Star geothermal heat pumps qualify for the tax credit.

Solar energy systems: For solar water heaters, at least half of the energy generated by the qualifying property must come from the sun. The credit is not available for expenses for swimming pools or hot tubs. Photovoltaic systems must provide electricity for the house, and must meet applicable fire and electrical code requirements.

Small wind energy systems: Includes residential small wind turbines with nameplate capacity of not more than 100 kilowatts.

Products not covered by the tax credit include refrigerators, dishwashers, clothes washers, room air conditioners, ceiling fans, programmable thermostats, electric storage tank water heaters and electric tankless water heaters.

Reach Sara Busse at sara.busse@wvgazette.com or 304-348-1249.

To see more of The Charleston Gazette, or to subscribe to the newspaper, go to http://www.wvgazette.com.

Copyright (c) 2009, The Charleston Gazette, W.Va.

Distributed by McClatchy-Tribune Information Services.

There are quite a few myths about log homes that are circulating among folks who are already having enough problems with sorting log facts from fiction.  Here’s my take on one of the biggest myths in the log home industry – How to get the “final“  total price of a log home from a manufacturer.  Time and time again, when I was selling log homes, customers would ask me to verify how to come to the final price on their new log home – to take the log package price and multiply it by 4, to take the advertised SF of a plan and multiply that by $150 a square foot, to see what the maximum they qualified for and add 10-25%.  The short answer to that question is – it depends.  Not very reassuring.  Here’s why.  Using multiplier won’t work because every log home manufacturer’s components package is different.  Company A’s product may be pre-cut, contain fastening hardware, with doors and windows.  Company B’s product may contain only the raw, random length wall logs and other log components.  If you use a static multiplier for either package, you’re going to get some fictional number that won’t do your budget any good.  There are just too many factors involved in getting an accurate job cost to just throw out “just multiply the log package price by “x” and you’ll have your budget.”  That won’t even get you in the ball park.  If someone gives you that advice, politely thank them and run the other direction.

When someone gives you an estimate of “x”  dollars per sqaure foot – take a few more mintues to ask this person some follow up questions.  If you are talking to a local builder, and your project is going into his territory, you might have a starting point to begin working out the details on your budget.  As you get close to selecting a builder/supplier, be sure to talk to some of their recent references, and be candid about your budget concerns – how close was this person to the original budget proposed (barring change orders).  Talk to the banks that they worked with.  Check them out with the Better Business Bureau or the State’s Attorney Generals office.  This is most likely the biggest financial investment you’ll make in your life – take the time to make sure the people you involve are capable and trustworthy.

If you are at a Log Home Show, and you get a quote of “x” dollars per square foot – I’d take that information with a grain of salt, unless they are truly a local builder.  Quite of a few of the log home companies travel across the country to the log and timber home trade shows, and they just don’t have the local contacts to give out accurate building costs.  For example – If you were to attend a Denver, CO show, depending on where your were building in the state of Colorado, your square foot building costs could range from $150 a SF to $300 a SF and up, for the EXACT SAME LOG HOME PLAN!  To get accurate figures, your best bet would be to work with some of the local businesses and trades from your building area.

In order to get any accurate budget information, you’ll need to start with a good and detailed set of plans.  If you’ve already decided on a manufacturer, and you’d like to proceed with their designs, be sure to take a look at a set of their final construction documents.  Make sure everything is spelled out.  Get your builder’s opinion on them – can he build from them.  Any information that’s left out is time and money on the job spent figuring it out.

The best way to take charge of your budget is to come into things fully prepared.  If you use an independent design firm, like Gravitas, you are calling the shots from the beginning.  You can go through the design process – including and many or as few of the log and timber components you like.  I say this because, the log and timber frame companies are in the business of selling wood.  It’s only natural for them to try to include as many components into your log package as they can – sacrificing elements of your design and budget to pad their sales figures.  With an independent design firm, you get the elements you want, where you want them.  Some people want to see log and timber everywhere – others only want log walls, with drywall and plaster to break up the exposed woodwork. Either way, you get the design elements you want.  The biggest advantage is that when you shop around, you have the power.  The log home companies are all bidding on the same set of plans, and they know you’re out there shopping around.  It’s in their best interest to give you the best price possible in order to stay competitive.  An independent set of plans forces them to sit down and dissect your house in order to get accurate figures.  When the preliminary bids come in – you’ll have the ability to compare the apples to apples.  Only when you decide on a manufacturer, should you begin the Final Construction Document phase of your plans.  By waiting until you choose a manufacturer, the designer can then incorporate the specific details pertinent to their particular construction system (thru-bolt, lags, mechanical settling devices, etc) into your plans set, giving more than enough details for the builder to generate an accurate budget for your new log house.

Bottom line is, if you don’t have a detailed set of plans – specific to not only your building site, but to your tastes and budget, how can you expect to get anyone to give you any sense of how much things will cost.  A good set of plans may run several thousand dollars, and if they’re done right and they are thorough, they can end up saving you thousands in the end.  Like it or not, you’re paying the same $$ when a builder and his crew are standing around trying to “figure out” a detail as you are when they are hard at work, building your dream home.  Doesn’t it make sense to arm them with the best information and plans?

Hope this was helpful.  Let me know if you have any questions.

Happy stacking!

Paul