Report Title:

Intellectual Property Insurance Assistance

Description:

Allows the department of business, economic development, and tourism to provide intellectual property insurance assistance to inventors and owners of intellectual property to protect their patents, copyrights, trademarks, and trade dress.

THE SENATE

S.B. NO.

849

TWENTY-SECOND LEGISLATURE, 2003

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to intellectual property.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. Section 211E-1, Hawaii Revised Statutes, is amended by adding three new definitions to be appropriately inserted and to read as follows:

""Department" means the department of business, economic development, and tourism.

"Intellectual property" means patents, copyrights, trademarks, and trade dress.

"Intellectual property insurance" means:

(1) Insurance that covers the expenses of an insured incurred in protecting the insured's intellectual property, including litigation expenses incurred to initiate suit against an alleged infringer of the insured's intellectual property and to defend against claims that the insured's manufactured products, marks, or works of authorship infringe the rights of another; or

(2) Insurance that reimburses the loss of intellectual property value or business interruption loss that is directly caused by an adverse happening involving insured intellectual property or insured manufactured products, marks, and works of authorship."

SECTION 2. Chapter 211E, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§211E-    Intellectual property insurance assistance; repayment requirement. (a) The department may assist inventors in obtaining and maintaining appropriate intellectual property insurance for their intellectual property, manufactured products, marks, and works of authorship or for loss of intellectual property value; provided that the department shall require the inventor or author to repay the department for the intellectual property insurance assistance in the form of equity in the invention, royalties, scheduled payments, or in any other manner deemed appropriate by the department that, at the minimum, reimburses the department for expenses incurred in providing intellectual property insurance assistance.

(b) The department shall adopt rules pursuant to chapter 91 to carry out the purposes of this section."

SECTION 3. Section 211E-2, Hawaii Revised Statutes, is amended to read as follows:

"§211E-2 Hawaii innovation development fund; establishment. (a) There is established a revolving fund to be known as the Hawaii innovation development fund, that shall be administered by the department [of business, economic development, and tourism] for the purpose of promoting the development of new [products or inventions] manufactured products, marks, works of authorship, or inventions that have direct economic benefits for Hawaii.

(b) The department shall [provide]:

(1) Provide low interest loans pursuant to subsection [(b)] (d) to inventors or authors for the development of their new [product or invention.] manufactured products, marks, works of authorship, or inventions; and

(2) Assist inventors and authors in obtaining and maintaining appropriate intellectual property insurance for their intellectual property, manufactured products, marks, works of authorship, or inventions, including paying a portion or all of the applicable insurance premiums and fees, pursuant to subsection (d) and section 211E- .

(c) All moneys received as repayment of loans and interest payment or repayments for intellectual property insurance assistance shall be deposited in the fund. The department may transfer moneys from the Hawaii innovation development fund established by this section to either the state disaster revolving loan fund established by section 209-34, or the Hawaii capital loan revolving fund established by section 210-3, and moneys from these three funds shall be disbursed by the department or the director pursuant to chapters 209, 210, and 211E, respectively. The department or the director may transfer moneys from the state disaster revolving loan fund and the Hawaii capital loan revolving fund to the Hawaii innovation development fund for disbursement pursuant to this chapter:

(1) The total amount of moneys transferred to the state disaster revolving loan fund, the Hawaii capital loan revolving fund, or the Hawaii innovation development fund shall not exceed $1,000,000 for each respective fund within the calendar year;

(2) Notwithstanding paragraph (1), the total amount of moneys transferred between the state disaster revolving loan fund and the Hawaii capital loan revolving fund or the Hawaii innovation development fund shall not exceed $1,000,000 within the calendar year if the governor proclaims a state disaster pursuant to section 209-2; and

(3) The department shall report any transfer of funds made under this section to the legislature within ten days of the transfer.

[(b)] (d) The department shall adopt rules pursuant to chapter 91 to carry out the purposes of this chapter including the following:

(1) Prescribe the qualification for eligibility of loan and intellectual property insurance assistance applicants;

(2) Establish preferences and priorities in determining eligibility for loans [and], loan repayments[;], and intellectual property insurance assistance;

(3) Determine the necessity for and the extent of security required in any loan[;] or in exchange for intellectual property insurance assistance;

(4) Establish the interest rates chargeable by the State; provided that each loan granted under this section shall bear a simple interest which shall not exceed seven and one-half per cent; [and]

(5) Prescribe the types of insurance coverage that intellectual property insurance assistance is limited to; and

[(5)] (6) Prescribe the forms of financial participation the department may engage in as a result of making a loan or providing intellectual property insurance assistance under this chapter, including but not limited to warrants, options, or royalties on sales or earnings."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect upon its approval.

INTRODUCED BY:

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