IP- View From Above

The information below is intended to be a quick IP refresher (or IP introduction). It tells us why we can’t just forget about the patent and file a copyright to protect our precious new invention. (I’ve honestly had a C-suite executive ask this type of question, so don’t feel bad if you’ve wondered about this as well!)  

The goal here is to give some practical knowledge about IP to help you quickly remember what a patent does, why it’s different than a copyright, and why you can’t trademark a trade secret.  

Intellectual Property (or IP for short) is at the heart of many corporate transactions and agreements, and it’s likely something that is a focal point of every company that you’ve wanted to start or even may have worked for. This is especially true in the life sciences and tech sectors.

Here, we’ll deal with the four areas of IP: patents, trade secrets, copyrights and trademarks.

Patents:

These are rights granted by the USPTO (The US Patent and Trademark office) through Federal Law and ultimately the US Constitution. A patent gives the owner the right to exclude others from practicing the invention claimed in the patent. The patent doesn’t grant rights to make the invention, or to sell it, or to use it. It gives you the right to exclude others from doing so.

While there are various requirements that you’ll need to meet to obtain a utility patent, the high-level items are that it must be (i) eligible subject matter (not naturally occurring); (ii) novel, non-obvious, and not subject to a statutory bar, and (iv) adequately disclosed. While you could read volumes on each of these subject areas, the point here is to get the broad strokes to compare this to the 3 other areas of IP law.

To dig a little deeper, a patent can be an incredibly powerful and lucrative asset. You get a monopoly! (at least for a set time period). The US Government usually doesn’t like this (I’m looking at you, Antitrust lawyers 😊). A patent can also be worthless. For example, if you obtained patent protection on a method making #2 pencil erasers out of moondust, you may find that there’s no one who could ever infringe the patent, and therefore, no potential buyer or licensee of the patent. Good luck covering your filing and prosecution fees on this business venture; however, if the patent is desired and can exclude others from making and using desired articles of manufacture, processes, chemical compositions, or machines, then you may have yourself the basis on which to start a company that holds patent assets.

Trade Secrets:

I often think of this area of IP as the thing that gives your business value only when it’s truly a secret.  Trade secrets could be a number of things that create value; like secret recipes (the ratio of cinnamon to salt in a cookie recipe), secret ratios of chemicals used in manufacturing your product, or even just the process you use to manufacture the product itself. If it gives you an advantage by others not knowing about it (especially if it’s unlikely to obtain patent protection for it), then you may want to keep it secret and ensure the specifics don’t end up disclosed in a patent application (since utility patents get published around 18 months after filing).

If you have a trade secret, I’d recommend not even telling your mother (no matter how much you love her). That’s simply because she might tell your uncle who tells your cousin, who tells the CEO of your competitor. Then “POOF”, no more trade secret. A trade secret must actually  be secret, the owner must take reasonable steps to protect it, and it must provide advantages over competitors.

Another item to seriously consider is ways to protect your trade secret. For example, if you wanted to tell a potential investor about your trade secret, perhaps you could give general information that doesn’t drill down to the specifics. If you do have to get into those details, it’s crucial to only disclose what’s necessary and to do so under a confidentiality agreement (obligating the investor not to use or disclose the trade secret). Further, you’d want to specifically call out in the agreement that some of the information you’re disclosing is a trade secret and that the obligation to not use or disclose the trade secret lasts forever or until the information is no longer considered a trade secret under law (if this ever happens). It’s important to remember that once the trade secret is out in the public domain, it’s the fish that got away; you can’t reel it back once it’s off the hook.

Copyright:

The first things that come to mind when I think of copyrights are songs, and other works of art like paintings, books, and even that beautiful software code your team wrote over the long weekend ahead of your product launch.

Copyright protects an original work of authorship, fixed in a tangible medium. Copyright protection is different than patenting an idea because copyright protects a particular expression of the idea; the Copyright Act doesn’t allow you to protect the idea itself. That’s left for patent protection which has a much shorter shelf life than a copyright, (20-ish years for a patent as opposed to the life of the author plus 70 years for a copyright!).

While you must file for patent protection with the USPTO, this isn’t the case for copyrights. A copyright exists when the expression of the idea is fixed in a tangible medium (although you may want to register your copyright with the US Copyright Office as it could provide benefits in litigation, this isn’t necessary for the copyright to be enforceable- the right exists upon creation).

Be warned, if your copyright captures the function of an idea and that function is not achievable by other means (say,  if it’s impossible to have a machine operate without the specific code you wrote) then the copyright may not be enforceable.  You may have been able to patent it, though. It’s worth thinking about carefully or seeking legal advice if you’re unsure.

Trademarks:  

These are usually words, phrases, symbols, and/or designs that are used as source identifiers for particular products. Trademark protection is meant to aid consumers in identifying and differentiating between brands. You don’t want your blockbuster drug to be confused with the company that just had a terrible contamination problem with their product. If consumers confuse the tainted product with your product, that could hurt your company’s name and its stock price.

To state what may be clear by now: you don’t trademark an idea, a song, or secret manufacturing ratios.  I once had a client (names/facts changed for confidentiality purposes and a bit of drama added for effect) but she trademarked the name of her company (prior to my working with her) with an obscure number/name. It was called 46 & 2 Biotech (bonus points if you know the song I took this from….don’t worry, I didn’t just infringe by using a song’s name).

Now, while 46 & 2 Biotech would likely be protectable as a trademark on its face, for a biotech company (assuming no confusingly similar marks are out there), the information contained in the mark was the key to her desired success. It was actually the secret ratio of certain substances in her lead compound!  While, I have to admit, it was an awesome name, I was a little worried that her competitors could crack the code based off of her clever name.

Even sensations (things you can smell, feel, and hear) can be protected as trademarks. You may have noticed that so many brands have annoying little “tunes” at the end of their commercials. Think about: NBC, Farmers Insurance, Intel, and even that terrifying sound you hear when you start your computer on a Monday morning. These are likely also trademarks that get little earwigs, nostalgia (or audio sensations) stuck in your head that make you think of the companies’ products.

In fact, Play-Doh trademarked the special smell of that sweet, squishy, clay you played with as a kid (and probably as a parent).

I think my son may be working on a trademark scent every time I open his bag of hockey gear!

If you have questions or would like to discuss strategies to protect your IP while engaging in various business transactions,  hit the connect or contact button to get in touch!  

This article is not intended to create an attorney/client relationship, nor should this be taken as legal advice. Any IP issues are heavily fact dependent and any similar situation you may have should be given the appropriate analysis by a legal professional before moving forward.