Should You Disclose or Receive Information with Examiners?

Is it possible to disclose too much with Examiners at the United States Patent and Trademark office?

The United States Patent and Trademark office is having a “Tech Week” the first week of December (Dec.1-5, 2014). This program is designed to permit scientists, engineers, and technology experts the ability to instruct patent examiners on their field of science and technology. The idea is that this instruction will aid patent examiners in being more informed about the state of technology in the various industries and further help to improve the patent process.

Is there risk to inventors from this disclosure?

Yes, but admittedly it may be minimal. Assuming each presenter has taken the necessary steps to protect their technology inventions prior to disclosure at this event, what harm is there? Any information examiners learn and receive can be used against any relevant application. This applies to the presenter in any new or future application and to other inventors navigating the process. Some will counter this small risk by saying that it serves to help strengthen the patents being issued. I do not disagree. But just keep in mind that any disclosure and education we give the examiners can have some risk with it. Additionally, it is my experience that our examiners are pretty knowledgeable in their particular fields and are exposed daily to new and novel inventions. Do they really need more understanding?

Potential harms of disclosing too much:

  • Unnecessarily narrowing your claims: You might reveal alternative embodiments or functionalities of your invention that could form separate claim limitations, potentially restricting the scope of your patent protection.
  • Enabling competitors: You could inadvertently provide valuable insights about your invention that competitors could use to design around your patent or develop their own products.
  • Raising objections by the examiner: Disclosing irrelevant or unnecessary details could distract the examiner from the core aspects of your invention and lead to unnecessary objections or rejections.

On a flip side, the USPTO is organizing opportunities to interact with the USPTO here in Texas where they provide the public information. We are currently in communication with the USPTO about workshops and informative sessions that may arise in your local area. These workshops/sessions would be used to provide general guidance and overviews of the patent procedures (as opposed to hearing your secrets).

However, there are also situations where more disclosure can be beneficial:

  • Addressing prior art: If the examiner cites prior art that seems relevant, disclosing additional details might help demonstrate how your invention is distinct and non-obvious.
  • Explaining complex concepts: Providing comprehensive explanations and examples can be helpful for the examiner to fully understand your invention, increasing the chances of obtaining a patent.
  • Responding to office actions: When addressing the examiner’s objections, additional information might be required to clarify your claims or overcome rejections.

What danger is there in this?

The USPTO can not give legal advice for your particular situation. At times they seek to build confidence in inventors who wish to go at it alone. There is a fine line with providing the public information and in providing to much specific information. Additionally, on average the strength of patents done by an attorney are stronger than those done by an inventor alone. So these workshops/sessions, if not done well may actually work to harm the strength of patents issued. Other nuances exist of course.

In the end, the USPTO is making efforts to be engaged with inventors. Most of it appears harmless but there are always risks or two sides to the situation. It is good to see them getting involved in the public but we counsel you to be cautious when disclosing information to the patent office and be realistic when it comes to filing your own applications.

Finding the right balance:

Ultimately, the key is to strike a balance between providing enough information for the examiner to understand your invention and avoid disclosing unnecessary details that could harm your patent protection. Here are some tips:

  • Focus on the claims: Always ensure your disclosure supports and clearly defines the scope of your claims, which are the legal boundaries of your patent protection.
  • Avoid irrelevant details: Don’t go off on tangents or disclose alternative embodiments that are not part of your claimed invention.
  • Seek legal advice: Consult with a patent attorney to determine the appropriate level of disclosure for your specific invention and situation.

Remember, the USPTO has a duty of disclosure obligation, meaning you are legally required to disclose all material information relevant to patentability, including prior art known to you that might make your invention seem less novel or non-obvious. Failure to do so could result in your patent being invalidated later.

In summary, while there’s no absolute rule against disclosing too much, it’s crucial to be mindful of the potential risks and find the right balance between informing the examiner and protecting your invention. Consulting with a patent attorney is highly recommended to ensure you navigate the patent prosecution process effectively.

Social Media Username Jacking

Your Social Media Identity

Social media represents a wonderful opportunity for businesses to connect with their customers and to get the word out about specials, promotions and new products. It seems like there are new social media platforms cropping up all the time, and though it probably isn’t necessary to join them all, it certainly makes sense to choose one, two or even three that align comfortably with your company’s image and the product or service that it provides.

However, what do you do when you discover that another entity or individual has already registered your preferred company name on a particular social media platform? Sometimes this is merely the result of two companies having similar names. At other times, another user has registered your company name in a scheme known as username jacking.

What Is Username Jacking?

In some ways, username jacking is a bit like domain squatting. An entity or individual scoops up likely domain names for well-known celebrities or brands then hopes to cash in when said celebrity or brand wants to take over the domain for their own use.

The Uniform Domain-Name Dispute-Resolution Policy, Or UDRP, is the accepted mechanism for resolving disagreements over the registration of domain names. However, there is no such mechanism in place when someone sets up a fake social media account using your name or the name of your business. Sometimes, these accounts are set up with the goal of criticizing your company. On other occasions, someone is seeking to malign your good name. It also is possible that another entity, perhaps your competitor, wants to make it difficult for you to gain prominence on that social media platform.

The idea of some unknown entity using your name to make social media posts can be troubling. There’s always the chance that your customers will see that username and believe that it belongs to you. You definitely don’t want to deal with any fallout from customers believing that they are interacting with you when they are actually interacting with someone who’s only pretending to be you.

What Can You Do About Username Jacking?

It’s vital to protect your intellectual property, especially since your name and brand help to solidify your reputation in the minds of consumers. When you find that someone has jacked your username, go straight to the complaint department for that social media platform. Their terms of use probably set up guidelines for complaining about false accounts. Some platforms have more clear-cut rules than others. Accordingly, this may not provide all of the help that you need. If the rules are sufficient, then the administrators at the social media platform will likely shut down or transfer the rogue account to you.

However, if the administrators say that they cannot help you and the owner of the account ignores your demands, then you may be forced to file a lawsuit. This may seem like an extreme response, but it also is a response that gets noticed. It typically is not advisable to sue the platform itself, as the administrators will argue that they generally are not responsible for posts made by users. Your intellectual property attorney will probably recommend suing the individual or entity behind the bogus account, a process that may involve subpoenaing the social media platform for data concerning the owner.

Speak with an Intellectual Property Attorney

A lawyer who focuses their efforts in this area of law is uniquely qualified to guide you through the process of identifying and potentially suing someone who is misusing your name or brand in the cyber world. While there is not as yet a great deal of case law in this area, legal precedent is growing by the year. Contact a skillful attorney today to learn more about the options that may be available to you.

Amazon Acknowledges Counterfeit Problem on Marketplace Platform

Amazon is one of the top retailers in the world, second only to Walmart. It generates billions of dollars in revenue each year, but only about half of that revenue comes from Amazon itself selling products.

The other half of the company’s revenue is generated by Amazon Marketplace sales. Marketplace operates like eBay in that it provides a platform on which buyers and sellers may meet and conduct transactions. Amazon isn’t involved in the process, but they do collect a fee from each sale as their due for hosting the transaction.

It’s a smart business model, but it doesn’t come without risk. In its annual 10-K filing with the Securities and Exchange Commission, the retail giant mentioned for the first time the risks that come with enabling the sale of potentially counterfeit products.

What Are Counterfeit Products?

Counterfeit consumer goods, which also may be referred to as knock-offs, are products that are sold under the brand name of a person or entity that did not actually authorize or manufacture the product. Counterfeiters hope to make easy money by selling merchandise that they purport to come from a reputable company. Unfortunately, what they are selling typically is of inferior quality.

This is a major financial and reputational problem for the maker of the authentic goods. Too frequently, consumers don’t realize that what they are buying isn’t the genuine article. When they receive an item that quickly falls apart or doesn’t function as advertised, they blame the maker of the brand-name item, which didn’t have anything to do with the counterfeit.

This is a headache for big-name companies, but it can be absolutely disastrous for start-ups and other small companies. Large organizations more frequently have the deep pockets that may be necessary to combat counterfeit goods. However, small businesses don’t have those resources. The reputational damage that they suffer as a result of counterfeiting may destroy them.

Counterfeits on Amazon

Amazon’s main business model is to buy products from manufacturers wholesale so that these items can be sold to customers at a discount. Accordingly, they have measures in place to ensure that they aren’t contracting to buy knock-offs. When consumers purchase an item that comes from the Amazon Retailer tier of the business, they can rest assured that they probably are getting the real thing.

That changes when consumers are dealing with Amazon Marketplace. Although Amazon says that they try to take steps to ensure the authenticity of the goods on the Marketplace, it is ultimately only the seller’s word that backs up the items they sell. When consumers receive products that clearly are inferior, both Amazon and the purported manufacturer get the blame.

Amazon’s Reporting 2018

Each year, Amazon files a Form 10-K with the Securities and Exchange Commission, reporting their year-end earnings for the prior year. In the report covering 2018, Amazon added a notation to shareholders that acknowledges that the sale of counterfeit items on the platform is a risk.

Amazon further acknowledged that they may not be able to prevent nefarious sellers from receiving money for transactions in which buyers never receive a product or when the consumer receives a product that is demonstrably different from the advertised product.

This is the first official acknowledgment from Amazon that counterfeit consumer goods are a growing problem. However, manufacturers like Williams-Sonoma, Daimler AG and Elevation Lab have long been complaining that the retailer isn’t doing enough to curb the sale of counterfeit items on its website.

In addition, Williams-Sonoma and Daimler have filed trademark infringement lawsuits against Amazon based on the appearance of their registered marks on advertisements for counterfeit products.

Another startling claim has emerged from Apple, which says that it believes that fully 90 percent of the items sold on Amazon that purportedly come from Apple are actually fakes.

Amazon Reporting 2023

In 2023, Amazon released its third annual Brand Protection Report, which highlighted how the company’s efforts to protect customers, brands, and selling partners from counterfeit products has resulted in more criminal referrals and industry partnerships than ever before.

However, the report also acknowledged that counterfeit products remain a challenge for Amazon. The report estimated that 0.01% of all products sold on Amazon were counterfeit in 2022. This may seem like a small number, but it represents millions of products.

Amazon is taking a number of steps to combat the sale of counterfeit products on its platform, including:

  • Investing in machine learning and artificial intelligence to identify and remove counterfeit products from its platform.
  • Working with brands and law enforcement to investigate and prosecute counterfeiters.
  • Providing educational resources to help customers and sellers identify counterfeit products.

Despite these efforts, counterfeit products continue to be sold on Amazon. This is partly because Amazon is a massive platform with millions of sellers and products. It is also partly because counterfeiters are becoming increasingly sophisticated in their efforts to evade Amazon’s detection systems.

Amazon is acknowledging that it has a counterfeit problem, but it doesn’t yet have an effective means for eliminating it. This means that it is up to the manufacturers of legitimate goods to protect their reputation and revenue by seeking intellectual property protection. Obtaining and enforcing official patent, trademark and copyright coverage are among the most effective tools that organizations can use to protect their interests.

Need Intellectual Property Advice?

Copyright Case: Star Wars Game; Sabacc

Star Wars and Intellectual Property

What is a trademark? Perhaps just as importantly, do common law trademark rights extend to protect many of the familiar elements in a work of fiction like a novel or a film?

These were some of the questions that Lucasfilm and a game manufacturer in the UK called Ren Ventures were in intellectual property litigation to answer in 2017. Lucasfilm was hoping to get similar answers to the ones that courts gave when trademark rights were extended to “kryptonite” from the Superman comics and the “General Lee” car from The Dukes of Hazzard television show. Ren Ventures was hoping that a certain element in Lucasfilm’s Star Wars universe would not be entitled to this protection.

Exactly why are these two companies engaging in costly litigation?

History of Sabacc

Back in 1980, Lucasfilm drafted a screenplay for a movie called Star Wars V: The Empire Strikes Back. This early draft contained a reference to Sabacc, a gambling card game in which Han Solo is supposed to have won the Millennium Falcon spaceship from Lando Calrissian.

Sabacc pops up again in a trio of Lando Calrissian novels, the first of which was released in 1983. The rules of Sabacc are explained in great detail in the books, including that the object of the game is to obtain a score that’s close to positive or negative 23.

It is only the true devotees of the Star Wars universe who are likely to remember what Sabacc is, and the number of people who read the Lando Calrissian novels closely enough to recall the rules of the game is even smaller. However, it seems that the people at Ren Ventures were paying attention. Their attention was so avid that they noticed that Lucasfilm had never sought formal trademark protection for the mark SABACC.

The Legal Argument for Ren Ventures

Ren Ventures clearly felt that this left a door open, as in 2015 they released a mobile game that they called Sabacc – The High Stakes Card Game. The rules are identical to those used in the Lando Calrissian books, and the marketing material for the game uses numerous Star Wars-related references.

By 2016, Ren Ventures had secured a U.S. trademark registration for the mark SABACC for goods including an online computer game. Lucasfilm evidently heard about the registration, because the company filed a petition to cancel the registration with the U.S. Trademark Trial and Appeal Board in 2017. Ren Ventures responded to the petition, at which point Lucasfilm suspended the proceedings in favor of a lawsuit for infringement of trademarks and copyrights.

It’s true that Lucasfilm never filed a trademark application for the mark SABACC. Was this shortsighted of them? Consider that over the decades, the Star Wars universe has become vast. It contains millions of details like the gambling game Sabacc. Protecting them each individually with federal registration is economically unfeasible. Plus, it’s hardly as if they company was using SABACC as a trademark. They would have to sell goods or offer services under the name Sabacc to have protection, wouldn’t they?

That’s the angle that Ren Ventures was arguing in their case with Lucasfilm. They say that Lucasfilm wasn’t using the word in a trademark sense, which should virtually make it fair game for someone else to use. Naturally, Lucasfilm doesn’t see it that way. They have created a widely recognized fictional world that enjoys copyright protection and, arguably, common law trademark protection. Lucasfilm believes that their rights to SABACC should be recognized as one more element in a universe that legally belongs to them.

The intellectual property litigation was still in its early stages but after a year the judgement was made.

The Final Judgement from Copyright.Gov

The court determined that defendants’ use of the Works was not fair. The court
concluded that the first factor, purpose and character of the infringing work,
weighed in favor of Lucasfilm. Because defendants “merely reposted images and dialogue from original works” with only some minor alterations or additions, the use was not transformative. Moreover, in posting the Works to promote their app, defendants’ use was commercial. The second factor, nature of the copyrighted work, favored defendants. While the Works are expressive, they have also been “published extensively,” since images, illustrations, and similar quotes appear at numerous locations online. The court observed: “As a result [of the publication of the Works], the authors have likely realized their expressive and economic interests to a great extent.” The third factor, amount and substantiality of the portion used, weighed for a finding of fair use, because defendants used clips only seconds long.

In comparison to the Works, these clips “are quantitatively insignificant.” The final factor, effect of the use upon the potential market, weighed against fair use. The court found “these GIF images can . . . have an adverse effect on the derivative market.” The court determined that because defendants use was non-transformative and commercial, it could presume the likelihood of market harm. The court concluded that since defendants did not “produce[] evidence to show lack of market harm to Lucasfilm from their unlicensed use, this factor weighs against fair use.”
Weighing the factors, the court heavily considered “the more important first and fourth factors” and concluded that defendants’ use was not fair. Therefore, the court granted Lucasfilm’s motion for summary judgment on its claim of copyright infringement.

Do I need to copyright my website?

Everyone Has a Website

Whether you build a website for personal or business reasons, chances are good that you pour your heart and soul into it. After all, that website is a reflection of you, and it also may be the first contact that your customers have with your business.

After putting so much time and effort into building your website, it makes sense to protect it. This doesn’t occur to many website owners, with the result that they are unable to recover damages when someone else steals their content.

Copyright Content

All of the content that you add to your website is either originally created by you or was created by someone else, like a contractor or employee, who was working for you. This means that you now own that content, whether it’s pages that describe who you are and what you do, blog posts or something else entirely.

Whatever that content is, you own it, and this means that you have the right to prevent others from using it without your permission. When you do see that someone has used your website content without asking you first, a registered copyright gives you the ability to pursue legal remedies.

Automatic Copyright Laws

You may have heard that copyright protection in the U.S. is automatic. This is true. In fact, anything that you fix in tangible form, like a drawing or a recording, enjoys automatic copyright protection in America.

However, this automatic copyright doesn’t necessarily go far enough when it comes to protecting your website’s content. Plagiarism on the Internet is rampant. Plenty of bad actors are out there who will simply copy your content or photographs and paste them onto their own website.

What can you do if this happens?

In this situation, it is best to have a federally registered copyright for your website and all of its content, which includes text, photos and other images. A formal registration demonstrates the date of creation of the content, enabling you to prove beyond a doubt that you are the originator and/or owner of the content.

What Federal Copyright Registration Provides

When you register your copyright, you are formally demonstrating your authorship of the content. If you hired someone to create some or all of your website content for you, then it makes sense to enter into formal agreements with these individuals in which they legally assign their rights in the created material to you. This usually helps to prevent later disputes should they ever arise.

Additionally, when you have registered your copyright, you have the right to pursue a civil lawsuit against an infringer. When a website is under a federal copyright, then the website’s owner may have the ability to claim statutory damages in addition to attorney’s fees if a lawsuit becomes necessary.

Copyright Notice

Whether you pursue a federal copyright registration or not, it is always sensible to include a copyright notice on each page of your website. Usually, such notices appear at the bottom of the page, and they may be as simple as “Copyright 2020.” Other possible copyright notices include ” © 2020″ or “All rights reserved.”

Still other appropriate copyright notices for websites include the name of the company or the individual who owns the website. As an example, the notice may read: “Copyright 2020, the ABC Company.”

While adding copyright notices to your website is not a requirement even if you federally register your copyrights, it is wise to do so to inform any visitors with bad intentions that you are aware of your rights and will defend them.

Ask an Intellectual Property Attorney for Assistance

Are you creating your first website or are you already the owner of several websites and just recently became aware that someone has stolen some of your content? In either situation, it’s wise to contact the Williams IP Law Office in Texas.

Jeffrey Williams helps clients with determining whether or not to federally register a copyright for various content on their websites. Moreover, Jeff can provide assistance with drawing up the various formal agreements that may be needed to ensure that the rights to website content are properly assigned from the author to the website’s owner.

Copyrighting website content in the U.S. is neither particularly difficult nor expensive, but it can be instrumental when it comes to protecting your work from infringement. If you’re serious about ensuring that others cannot take advantage of your hard work, then contact Williams IP Law.

New Tool For Intellectual Property Owners

Are you a creator or an entrepreneur? Perhaps you’ve just started a new business. It’s an exciting time, but it isn’t always easy to identify the most critical tasks that you need to accomplish.

Choosing the proper entity and getting registered with the state certainly are crucial. However, your new venture may benefit just as much from identifying your intellectual property assets and how to protect them.

Your intellectual property, otherwise known as IP, may consist of things like your company’s name and logo as well as the new product that you’re launching. Maybe you have written some brand-new and revolutionary computer code or composed a piece of music.

Regardless of what you have created, chances are good that it could be considered IP, and that means that you’ll want to think about whether or not it makes sense to formally protect that IP with the US Patent and Trademark Office.

If you are new to the world of IP, then it definitely is wise to find an experienced guide. An intellectual property attorney can provide you with the support and advice you need. However, if you’re wondering if what you’ve created could even be considered intellectual property, then you may need a more basic place to start.

A New Online Tool for Innovators

Most countries have a government department that’s in charge of handling patent and trademark applications within its borders. In America, this department is known as the US Patent and Trademark Office, or USPTO.

The USPTO provides a variety of online tools and resources through which it is possible to search and file patent and trademark applications, communicate with examining attorneys and more. While some of these tools and resources are fairly user-friendly, many of them are intended for use by intellectual property attorneys and other legal professionals who have a significant level of experience in this area.

Recently, the USPTO announced the launch of a new online resource called the Intellectual Property (IP) Identifier. What sets this tool apart from many of the others on the USPTO website is that it is purpose built for people who don’t have extensive experience with IP.

In fact, it isn’t necessary to know the difference between a patent and a trademark because the Intellectual Property Identifier takes you step-by-step through the process of deciding what kind of IP you have and how to protect it.

Additionally, this innovative virtual resource provides approachable information regarding the various forms of intellectual property protection and how each might be advantageous for a business or an individual to pursue.

The IP Identifier in Detail

Currently, the IP Identifier consists of two main modules. These are the Basic IP Identifier and the Advanced IP Identifier. Users move through the Basic module by answering just a half dozen questions. This helps the user to identify their IP and how to protect it.

The Advanced module takes things a few steps further by providing information to users about their IP. Links to additional resources are provided. These resources include instructions for how to file an application to protect IP.

The USPTO plans to launch a third module in the future about managing IP assets.

Why Use the Identifier and Protect Your IP?

Many inventors and entrepreneurs who are new to the world of IP feel a little overwhelmed when it’s suggested that they should seek patent protection. In fact, some innovators put off filing applications with the USPTO until it’s too late. Frequently, this means that someone else has already filed a patent application for similar technology, which can make it difficult or even impossible for anyone else to obtain meaningful protection.

According to the USPTO, protecting intellectual property “is a smart and necessary business strategy” that is of tangible benefit to organizations. A first patent may be used as collateral, which is known to increase capital funding by as much as 76-percent in a three-year period. Obtaining a first patent additionally has been known to increase initial public offering funding by as much as 128-percent.

Most entrepreneurs also don’t realize that having protected IP can be a powerful tool for recruiting. Statistics suggest that the approval of an initial patent application may lead to 36-percent employee growth over a five-year period. Market share similarly can increase. Studies concluded that startups that have a patent tend to increase sales 80-percent more than companies that have no protected IP.

Ready to Start Your IP Journey?

At Williams IP Law, we help entrepreneurs of every size and description obtain the IP protection that they need. While we provide support to large companies, we also are dedicated to helping startups and individual inventors learn more about intellectual property and how they can protect their most valuable assets.

Schedule a free consultation today with a legal professional at Williams IP Law.

How 3D Printing Affects Intellectual Property

Artists, designers and industries have always wrestled with the potential problem of intellectual property theft. Whether it’s fighting to fending off the malicious reproduction of closely guarded designs or trying to keep an eye on the distribution of licensed creations, the challenges of maintaining intellectual property rights are only getting more complicated as 3D printing increases in popularity.

What is 3D Printing?

Also called additive manufacturing, 3D printing uses a special type of printer and one of hundreds of manufacturing materials to create solid copies of objects. To make this possible, the objects are first scanned with a 3D scanner and turned into Computer Added Design (CAD) files that the printer then reads. Materials are laid down in successive horizontal layers as the printer effectively “builds” the item section by section, which stands in contrast to the subtractive nature of traditional manufacturing.

This rapidly growing technology has a multitude of applications. It may be used to create models, prototypes or parts for machines and aircraft. Methods for printing working human organs for use in transplants are also in the works. On the creative side, 3D printing provides a way for artists and designers to literally bring their imaginations to life.

While there are many applications that will change our future, we are already seeing homes being developed using this technology and it’s being hailed as the technology of the future for affordable housing.

The Intellectual Property Dilemma

Just like the troubles that arose surrounding peer-to-peer music and file sharing sites, problems with intellectual property law are beginning to pop up in relation to 3D printing. Many “blueprint” sites exist where designers can upload their creations for others to print, but not all of these creations represent original work. Even when they do, it can be difficult to track whether or not end users are following proper attribution procedures according to any creative licenses attached to the design. At a certain point, reproduction becomes uncontrollable and the origin of the initial creation gets lost in the chaos.

One of the biggest problems with 3D printing and intellectual property law is that most people don’t understand how copyright works. This leads to unintentional and accidental infringement that can result in big losses for the companies or designers holding the rights to the items being reproduced. With personal 3D printers becoming more common, it’s getting harder to track down individual infringers and prove that their actions are worthy of legal punishment.

If it’s just a CAD file, what happens if that file is released to the general public or what happens if the file is changed for the better or worse? The liability by itself is enough to make sure we establish property intellectual property guidelines.

3D Printing, Intellectual Property and the Future

Copyright law technically goes into effect the moment a unique design is created, but industries and designers can file for additional legal protections in an attempt to keep their intellectual property from being reproduced. Patents, trademarks and design protection are all meant to ensure that a design remains the property of the original creator. However, these do little to stop malicious users from creating counterfeit copies of anything from toys to functional weapons. The potential dangers posed by some of these items may bring other branches of the law, such as liability law, into play as time goes on.

Given the complex legal challenges surrounding 3D printing and intellectual property, it could be some time before official legislation is put in place to handle cases of infringement. Until then, those who create and distribute designs need to be made aware of how to take advantage of available protections so that they have some type of legal recourse should their creations fall into the wrong hands.

Our Solution

Williams IP Law has worked across many verticles and can help if you think that someone has violated your intellectual property rights through 3D printing. With offices throughout Texas, we can help you wherever you are located.

Trade Secrets Rights and Uses

Intellectual property may be protected in a variety of ways. New inventions may be covered by a patent while your company’s name and logo may be protected with a trademark registration. If your company publishes brochures, then these are covered with a copyright.

However, what if your company has something that they would like to protect, but keep secret? Several famous examples of “trade secrets” exist. These include Kentucky Fried Chicken’s 11 herbs and spices, the secret formula for making Coca-Cola and the search algorithm that Google uses.

Why didn’t these companies decide to patent or otherwise protect their IP via the various mechanisms that are available under U.S. law?

It’s because they wanted to keep their “secret ingredient” a secret. When you file a patent application, for example, it is essential that you disclose everything about the invention so that the United States Patent and Trademark Office can establish that it is non-obvious, novel and eligible for patent protection.

This means that any proprietary information that goes into your invention will eventually become public knowledge. When your patent expires, your technology becomes available for others to use.

However, when you protect something as a trade secret, then you have the potential to keep it a secret in perpetuity.

What Can You Protect with a Trade Secret?

Trade secrets can protect an array of things, from an ingenious idea that gives your firm a competitive edge to the marketing plans for your newest product. Similarly, customer lists can be protected as trade secrets as well as information regarding prices and costs.

Some companies even protect negative know-how as a trade secret. This basically refers to anything that they have learned to not do through extensive research and development. Sometimes, this information is just as valuable as the ingredients that successfully make up your secret.

Essentially, a trade secret can be almost any information that is valuable to your company and generally isn’t known to the rest of the world, especially your competition.

What Rights Does a Trade Secret Grant?

If a company chooses to keep some information as a trade secret, then they have the right to prevent certain people from using or benefiting from that trade secret.

Some of these people are automatically bound by a strict duty of confidentiality. This applies to any employees who work with or are knowledgeable about the trade secret.

Trade secrets also give you legal protections in the event that your proprietary information is illegally obtained via bribery or theft. A company with a trade secret further can prevent people who accidentally discover the secret information from profiting from it as well as those who are asked to sign a non-disclosure agreement before the confidential information is shared with them.

However, a trade secret does not grant a company any rights if another party independently discovers the trade secret. As an example, there is no law that prevents someone from reverse engineering a product that is only protected as a trade secret. This means that theoretically someone could analyze the formula used to make Coca-Cola, discover its precise ingredients and then start making and selling their own version of Coca-Cola. Because Coca-Cola’s formula is only protected as a trade secret, they would have a lot of difficulty stopping the inventor from profiting from his knowledge.

How Does a Company Protect a Trade Secret?

Businesses have to do more than just call a certain piece of information a trade secret. Instead, it is necessary to take affirmative actions that will protect this information and keep it confidential. Many companies will take extreme measures to keep their information strictly private.

This is the case with the makers of Coca-Cola, as the formula is locked in a bank vault that is only able to be opened after a resolution is passed by the board of directors. Only two company employees are ever allowed to know the formula at the same time. These employees are forbidden from flying on the same airplane, and their identities are never made known to the public.

Most companies do not have to go to such extreme lengths to protect their trade secrets. A few reasonable precautions generally are all that is required.

For instance, it is wise to mark any documents with “Confidential” if they contain any trade secret information. All trade secret materials probably should be locked away in a safe or other secure area after hours. Another sensible measure is to beef up any computer security protocols to ensure that hackers and other bad actors can’t gain access to sensitive information.

If you do have trade secrets, then you’ll probably want to limit how many people actually have access to that information. Ensure that your employees are bound by a duty of confidentiality, preferably with a written document, and do the same with anyone who is not an employee but who must be told about the trade secret for any reason. A proper non-disclosure agreement is a simple document that can help to protect proprietary information under just about any circumstances.

Talk to a Lawyer About Protecting Trade Secrets

If you have proprietary information that you believe would be best protected by keeping it as a trade secret, then contact the Law Offices of Jeff Williams. Mr. Williams is an experienced intellectual property attorney who can help you to understand your rights and devise a strategy for protecting proprietary information.