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PRDV205: Business Law and Legal Procedures

Unit 7: PROPERTY   The idea of property usually strikes people as a fairly simple concept.  However, the law recognizes that the interests in various types of property are often anything but simple, and can sometimes result in highly complex problems.  For example, if you sell your house to someone, what elements of the house cannot be removed, and, in contrast, what things can be taken with you when you leave?  Certainly you have an automatic right to take your clothes, your furniture, and your photographs and artwork.  But what about a favorite chandelier?  How about the built-in island counter in the kitchen?  Can you take the windowpanes?

The law recognizes two categories of property.  There is real property, which is land and anything attached to it, such as a house and the items physically attached to the house.  In contrast is personal property, which includes everything outside of real property.  As you work through this unit, ask yourself what types of situations might render an item personal property, and what situations might render that same item real property.

In this unit you also will explore the concept of intellectual property, which is a form of personal property.  Intellectual property represents intangible property rights in the form of words, symbols, designs, formulas, and other products of the human intellect.  For example, Coca-Cola has rights to the recipes for its products.  If the company’s recipes became public knowledge, Coca-Cola might lose its competitive advantage in the marketplace; as a consequence, Coca-Cola’s recipes are some of the most closely guarded trade secrets in US commerce.  As you will learn in this unit, trade secrets are just one type of intellectual property; and most forms of intellectual property are protected by federal laws and regulations.

Unit 7 Time Advisory
This unit should take you approximately 3 hours to complete.

Unit7 Learning Outcomes
Upon successful completion of this unit, you should be able to:
- identify characteristics of real property; - identify characteristics of personal property - distinguish between real and personal property; - describe how ownership and possessory rights in property may be transferred; - identify the various rights protected by intellectual property laws; - describe how intellectual property rights can be violated and the consequences of such violations; and - identify remedies for and defenses from violations of intellectual property rights.

7.1 Real Property   - Reading: The Legal and Ethical Environment of Business: “Chapter 8, Section 2: Real Property” Link: The Legal and Ethical Environment of Business: “Chapter 8, Section 2: Real Property” (PDF)

 Instructions: Read Chapter 8, Section 2 of the textbook.  *Real
property* includes land and personal property that has become
attachedto land.  The concept of *attachment* is critical in
deciding whether a piece of property is considered real or personal
– and thus which body of law applies to that property.  The next
subunit will cover personal property in more detail; this reading
will introduce you to the various interests and duties that may go
into the ownership of real property.  

 As you read this section, focus on the unique requirements that
must be met during the transfer of ownership of real property, and
the various ways in which such a transfer can be proven through the
filing of transfer documents.  As you read, pay close attention to
the concept of *adverse possession*, and consider the following
questions: Does adverse possession seem fair to you?  Under what
circumstances might you consider adverse possession to be fair, and
under what circumstances might you consider it to be unfair?  Note
that the possession of real property may be transferred *without*
transferring ownership.  As you complete this reading, make sure you
have a solid understanding of the various possessory interests that
arise in real estate.  

 Reading this textbook section should take approximately 30
minutes.  

 Terms of Use: This text was adapted by The Saylor Foundation under
a [Creative Commons Attribution-NonCommercial-ShareAlike 3.0
License](http://creativecommons.org/licenses/by-nc-sa/3.0/) without
attribution, as requested by the work’s original creator or
licensee.

7.2 Personal Property   - Reading: The Legal and Ethical Environment of Business: “Chapter 8, Section 1: Personal Property” Link: The Legal and Ethical Environment of Business: “Chapter 8, Section 1: Personal Property” (PDF)

 Instructions: Read Chapter 8, Section 1 of the textbook.  Books,
cars, shares of stock, and accounts receivable are all examples of
personal property.  Ask yourself: How are these properties the
same?  How are they different?  Note that some items that are
considered personal property under one circumstance may be
considered real property under another circumstance.  What might
these different circumstances be?  

 As you read this section, consider how transfers of personal
property occur in our everyday lives.  For example, in the past year
you have likely bought books, electronics, or even a car – all
transactions in which you took ownership from a prior owner (either
a business or an individual person).  As you read, make sure you
understand the various ways in which the ownership of personal
property can be transferred.  To better understand these concepts,
explore the resources within the textbook section box titled
"Hyperlink: Finders Keepers?"  Be sure you know what legal rights
and obligations are at stake when the possession of (rather than the
ownership of) personal property is transferred.  

 Reading this textbook section should take approximately 30
minutes.  

 Terms of Use: This text was adapted by The Saylor Foundation under
a [Creative Commons Attribution-NonCommercial-ShareAlike 3.0
License](http://creativecommons.org/licenses/by-nc-sa/3.0/) without
attribution, as requested by the work’s original creator or
licensee.

7.3 Intellectual Property   7.3.1 Patents   - Reading: The Legal and Ethical Environment of Business: “Chapter 9, Section 2: Patents” Link: The Legal and Ethical Environment of Business: “Chapter 9, Section 2: Patents” (PDF)

 Instructions: Read Chapter 9, Section 2 of the textbook.  Patent
law is an increasingly complex area of the law that generates much
conflict and controversy.  A patent provides property rights for the
design of a useful new invention over a certain time period (after
which the patent expires).  As you read this section, make sure you
understand the three types of patents, and take note of the kinds of
products and ideas that may not be patented.  This textbook section
includes an interesting exploration of whether there is – or should
be – the ability to patent a living thing.  Be sure to note the
remedies that are available to patent holders when their patents are
infringed.  

 Reading this textbook section should take approximately 30
minutes.  

 Terms of Use: This text was adapted by The Saylor Foundation under
a [Creative Commons Attribution-NonCommercial-ShareAlike 3.0
License](http://creativecommons.org/licenses/by-nc-sa/3.0/) without
attribution, as requested by the work’s original creator or
licensee.

7.3.2 Trademarks   - Reading: The Legal and Ethical Environment of Business: “Chapter 9, Section 4: Trademarks” Link: The Legal and Ethical Environment of Business: “Chapter 9, Section 4: Trademarks” (PDF)

 Instructions: Read Chapter 9, Section 4 of the textbook.  Trademark
law allows a company to secure a claim to a specific identifying
item that distinguishes the business, such as a name or a design. 
Consider some of the trademarked items you might be familiar with –
such as those used by international restaurant chains, software
companies, and mobile-phone manufacturers.  Companies use trademarks
to set themselves apart from similar companies and to allow their
consumers to easily identify their products.  The US government has
adopted a specific regimen of laws to protect such trademarks.  As
you read, note the many identifying categories that may be
trademarked, such as the shape of a bottle.  Take note, too, of what
may not be trademarked under US law.  Lastly, be aware of the
remedies that are available to trademark holders following the
infringement or dilution of their trademark, as well as the defenses
that can be made by an alleged infringer against a
trademark-holder’s claims.  

 Reading this textbook section should take approximately 45
minutes.  

 Terms of Use: This text was adapted by The Saylor Foundation under
a [Creative Commons Attribution-NonCommercial-ShareAlike 3.0
License](http://creativecommons.org/licenses/by-nc-sa/3.0/) without
attribution, as requested by the work’s original creator or
licensee.

7.3.3 Copyright   - Reading: The Legal and Ethical Environment of Business: “Chapter 9, Section 5: Copyright” Link: The Legal and Ethical Environment of Business: “Chapter 9, Section 5: Copyright” (PDF)

 Instructions: Copyright is another area of intellectual property
law that has grown more controversial over the past twenty years,
particularly with the rise of the Internet.  The arrival of the web
has allowed for an astronomical rise in the availability of original
written content and other creative material to the general public. 
For some users, this easy access can lead to confusion about the
ownership of web material, including the assumption that such
material may be used by any person for any reason.  In addition,
other web users have intentionally sought to bypass the protections
available to owners of such material.  Some see the copyright
protections available to such creative work as excessively
restrictive, and through various efforts these users attempt to
promote the availability of creative work through open copyright
licenses.  As you read this textbook section, familiarize yourself
with the protections that US law provides to copyright holders. 
Note the ways in which digital copyright licenses can further
restrict the use of digital media, and be sure to pay attention to
the remedies that are available to a copyright holder following a
copyright infringement (as well as the defenses that an accused
copyright infringer might make against such an allegation).  

 Reading this textbook section should take approximately 30
minutes.  

 Terms of Use: This text was adapted by The Saylor Foundation under
a [Creative Commons Attribution-NonCommercial-ShareAlike 3.0
License](http://creativecommons.org/licenses/by-nc-sa/3.0/) without
attribution, as requested by the work’s original creator or
licensee.

7.3.4 Trade Secrets   - Reading: The Legal and Ethical Environment of Business: “Chapter 9, Section 3: Trade Secrets” Link: The Legal and Ethical Environment of Business: “Chapter 9, Section 3: Trade Secrets” (PDF)

 Instructions: Read Section 3 from Chapter 9 of the textbook. 
Trade-secret laws generally protect businesses that wish to maintain
the confidentiality of such properties as formulas, processes, or
client lists due to the important economic value that these
properties provide.  Unlike US trademark, patent, and copyright
laws, trade-secret laws in the United States are covered only by
individual state laws, not federal law.  Make sure you understand
both the civil and the criminal penalties that a party might face
when it is accused of stealing a trade secret, as well as the
defenses that an accused party might mount against such a claim.  

 Reading this textbook section should take approximately 15
minutes.  

 Terms of Use: This text was adapted by The Saylor Foundation under
a [Creative Commons Attribution-NonCommercial-ShareAlike 3.0
License](http://creativecommons.org/licenses/by-nc-sa/3.0/) without
attribution, as requested by the work’s original creator or
licensee.