You need to read 17 USC 113(a) http://www.law.cornell.edu/uscode/text/17/113 which specifically gives to the copyright owner the right to do what you do. 17 USC 501http://www.law.cornell.edu/uscode/text/17/501gives a copyright owner a cause of action against you. Since you are deliberately doing this you might well face loss of your profits, an injunction, statutory damages of from $750 up to $150,000 per instance, payment of attorney fees of the copyright and/or other remedies if these images you are reproducing are copyrighted.
As to trademarks, I think you face a risk, albeit slight, of being held to be engaging in trademark infringement under 15 USC 114(a) and/or unfair competition under 15 USC 1125(a) since you are accepting money for producing a product with a false designation on it. The difficulty for the trademark owner is to convince a court the product or service is in commerce. If you advertise what you are doing and use any sample of prior work in your advertising, I think you are on the wrong side of the law. See 15 USC 1114(b) You must realize that courts tend to interpret laws so as to, in their mind, do substantial justice. I think it would be an uphill battle for the NFL or similar brand owner to win this case, but I think if they perceive this as a growing trend that might cut into their licensing revenues (e.g. if a licensee demands they do something about it), they might take a flyer and try to convince a Judge to make some new case law in their favor on this. It is possible they might find a sympathetic court somewhere that likes sports teams and thinks you are ripping them off and get that new law. You don't want to be that groundbreaking case, as once it starts you can expect the brand owner to run your legal costs into the stratosphere, particularly if they can get past a summary judgment and to a trial.
So with likely illegality on the copyright side and borderline legality on the trademark side, I think this is a moderate to high risk business - moderate so long as you are small potatoes and there are not too many other engravers out there, high risk if there are lots of engravers doing this and the NFL, NBA, NHL, and NCAA decide they need to shut this practice down.
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A photocopier only copies, and it does not distinguish between a copyrighted book and one that is in the public domain. It is the photocopier's operator that does the distinguishing and committing the infringement.
In the situation you describe, the engraver does not care what does engrave, however you should.
Your situation is interesting because you are not selling goods, just providing a service, and that service would be tantamount to contributory infringement, meaning you are helping others infringe.
For well known marks, that would be a problem, but there may be marks which have restrictions only in the class where they registered. If your engraving is limited to sports teams, then the bad news apply to you.
The infringing lawsuit will go first against the product owner, and then they will bring you in as contributory infringer.
There should be better things to do with and engraving machine.
USPTO Registered Patent Attorney, Master of Intellectual Property law, MBA I am neither your attorney, nor my answers or comments in AVVO.com create an attorney-client relationship with you. You may accept or disregard my free advice in AVVO.com at your own risk. I am a Patent Attorney, admitted to the USPTO and to the Florida Bar.
The chances the you will be sucked into an infringement action are probably slim, but this does not mean you have a legal right to do what you are doing. And if you are for example advertising and have a website offering the serivce you may hear from someone's attorney.
I don't want to use the tattoo example becuse it is such a nuanced case and not really the same here.
If you, as the owner of a football jersey wanted to emboss it with some NFL trademark well you can do whatever you wish with your own property and I highly doubt even the hyper-aggressive NFL would dare to file against a fan as an individual.
But here, you are making a buisiness out of helping people infringe. For example, if I hire you to emboss an NFL logo on my shirt then you can be held liable for that infringement. There was a recent case where Laboutin (red sole shoe company) successfully sued a small shoe repair service because they were servicing customers by painting the soles of the shoes they brough into the shop the same color as Laboutin's now famous trademark China Red.
As you noted, there may also be copyright issues here as well.
I would suggest that you consult an IP lawyer before you make any investment in this as a business so you understand the limits of what you can do legally.
I will link you to some general helpful info below as well.
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Q: "So what copyright issues am I facing?"
R: Copyright law states, in relevant part, that " ... the owner of copyright under this title has the exclusive rights to ... reproduce the copyrighted work in copies or phonorecords." 17 USC 106. When you draw someone else's copyrighted image in exchange for money you're unlawfully reproducing that image. Which is copyright infringement. If you want to continue your infringing conduct you should discuss this with your own copyright attorney.
The above is general information ONLY and is not legal advice, does not form an attorney-client relationship, and should NOT be relied upon to take or refrain from taking any action. I am not your attorney. You should seek the advice of competent counsel before taking any action related to your inquiry.
From the trademark standpoint, you can't use someone else's trademark in commerce. You're not proposing personal use for yourself, you're proposing offering your engraving services to others for money.
It's no defense to say the customer requested it, or that the engraving would take place or ultimately sometimes be located be on private property. Interesting analogy to tattooing. but I don't there's any chance of a consumer thinking that someone's skin has been endorsed by a sports team.
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"I understand tattoo artists can tattoo copyrighted images on someone's skin." Tell that to the producers of Hangover 2. In that movie, one of the characters gets a tattoo like the one Mike Tyson has on his face. But Mike Tyson did own the copyright to the design of that tattoo. Rather, Mr. Tyson apparently has acknowledged that the original tattoo artist owns the copyright to that tattoo. So the tattoo artist sued the producers of Hangover 2 for copyright infringement. The producers attempted to get the case dismissed, and when they were unsuccessful, they settled with the tattoo artist for an undisclosed amount. So, I would not say that copyright law does not apply to tattoos as your post seems to imply.
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I agree with Mr. Natoli. If you are just using it for your own personal purposes, it is probably not going to result in any action. However, once you step out of the simply personal realm, it will probably attract the attention of some entity. The question that you need to ask yourself: "Is it worth it if I get dragged into an infringement suit?" The answer is probably no.
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