From Invention To Patent:
Protecting New and Innovative
Business Ideas: The Importance
of Proper Management of Trade
Secrets and Patents
Guriqbal Singh Jaiya
Director, SMEs Division
WIPO (www.wipo.int/sme)
Short Guides on IP for Business
• Published
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Flash Version
Making a Mark (Trademarks)
Looking Good (Designs)
Inventing the Future (Patents)
Creative Expression (copyright)
• In the pipeline
– Trade Secrets
Useful Book
• Intellectual Property Management: A Guide for
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Scientists, Engineers, Financiers, and Managers
By Claas Junghans and Adam Levy
© 2006 WILEY-VCH Verlag GmbH & Co. KGaA,
Weinheim, Germany
ISBN-13: 978-3-527-3186-3
ISBN-10: 3-527-31286-2
170 pages
Key Message
By establishing a culture of identifying, cultivating
and strategically using its IP assets, an enterprise
can increase its revenue, have an edge over its
competitors and position itself well in the market.
Ignoring IP altogether is in itself an IP strategy that
may prove costly to the enterprise in the longterm.
Dr. Horst Fischer, Corporate Vice
President, Siemens AG
“Any company wishing to prosper in the
next millennium will also have to
efficiently manage its IP portfolio”.
“For this reason it has become essential that
every manager in the enterprise - not just
those working in the corporate legal
department - appreciates and understands
not only what IP is, but how it can be
more effectively exploited."
What are IP Rights?
• Industrial Property Rights
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Patents and Utility Models (or “short-term patents”)
Trademarks
Industrial Designs
Geographical Indications
Trade secrets
Topographies of integrated circuits
• Copyright and Related Rights
• New Varieties of Plants
• Non-original databases
Trade Secrets
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Definition
Examples
Protection Strategies
Using; sharing (CA/NDA/NCA)
Licensing; strategic alliances;
partnerships
• Audit
• Competitive intelligence; espionage
• Re-assess risk & value: Internal/external
Actual Vs Legal Trade Secrets
• Actual secrets: Trespass
or theft
• Legal trade secrecy is
not actual or absolute
secrecy.
Definition: Identify Trade Secrets
Considerations in determining whether
information is a trade secret:
• Whether known outside the company
• Whether widely known by employees
and others involved with the company
• Have measures been taken to guard its
secrecy/confidentiality
Identify Trade Secrets Contd...
• What is the value of the Information to
your company?
• What is the potential value to your
competitors?
• How much effort and/or money spent in
collecting/developing it?
• How difficult would it be for others to
acquire, collect or duplicate it?
Definition
• Formula, pattern, device or compilation
of information, unknown to others, that
gives competitive advantage
• Common law or statute
• Unlimited Duration / No registration
• Cost (of maintaining secrecy, security, ;
surveillance, litigation)
• Reverse engineering; independent
development
Examples
• Unpatented inventions
• Future product designs/models
• Valuable nonpublic company documents:
Drawings, blueprints, laboratory
notebooks, test data and training manuals
• Marketing, purchasing, planning and
customer information
• Financial, accounting, recruiting and
legal information
Examples Contd...
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Strategic plans
Product concepts
Financial reports
Customer lists
Employee files
Engineering plans
Production manuals
You may get a lot!
In a single misappropriation act a
biotechnological trade secret may be
obtained which represents:
• (1) the blueprint (DNA);
• (2) the machinery (expression system used)
• (3) the factory itself (host cell contining the
recombinant DNA under control of the
expression system)
Stealing may be Easy!
• Micro-organisms: vast numbers,
microscopic size and self
replicating!
• Italian subsidiary of a US
pharmaceutical house dipped
handkerchief into fermentation vat
at his own retirement party!
Integrated Security Environment
• Identify key corporate assets/ “crown jewels”
• Integrate and Balance security components in
interlocking layers to protect against perceived
risk profile
• Communicate, train, and educate employees to
distribute ownership of the security process
throughout the employee (weakest Link)
• Monitor and Reassess to adapt to changing risk
profile
Protection Strategies
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Identify Trade Secrets
Develop Protection Policy; Document it
Educate Employees; Monitor Compliance
Restrict Access
Mark Documents
Physically Isolate and Protect
Maintain Computer Secrecy
Protection Strategies Contd...
• Restrict Public Access to Facilities
• Deal Cautiously with Third Parties;
Confidentiality Agreements and
Nondisclosure Agreements
• Be Careful and Consistent with Unsolicited
Submissions
• Security/Trade Secret Audit; internal /
external
• Coordination of integrated security
enterprise-wide
Protection Policy
Advantages of a Written Policy
• Transparency
• Clarity (how to identify and protect)
• How to reveal (in house or to outsiders)
• Demonstrates commitment to protection;
important in litigation
Educate Employees
• Prevents inadvertent disclosure; employment
contract
• Unscrupulous employees (personal gain)
• Terminated employees (revenge)
• Former employee (inadvertent loss, hired by
competitor, or becomes competitor)
• Educate and train (on hiring give copy of
policy, periodic training and audit, exit
interview, retirement); proactive role
Educate Employees Contd...
• Make known that disclosure of trade secret
may result in termination and/or legal action
• Confidentiality agreements/non disclosure
agreements/ Non compete agreements
• Transform every employee into a potential
security officer; every employee must
contribute to maintain the security
environment
• Human and procedural security must be
proactive; clear communication and repetition
Restrict Access
On a “Need to know
basis”
Mark Documents
• Uniform system of marking
documents
• Paper Based
• Electronic
Physically Isolate and Protect
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Separate locked depository; authorization
Access control (third parties; unauthorized )
Log of access; document reviewed or taken
Surveillance of depository/company premises
Shredding
Oversight; audit trail
Labs, green houses, test plots, etc
Maintain Computer Secrecy
• Authorization; access control
• Mark confidential or secret; legend pop,
or before and after sensitive information
• Physically isolate and lock: Computer
tapes, discs, other storage media
• Remote access
• E-mail; SMS messages
• Oversight; audit rail
Restrict Public Access to Facilities
• Log and visitor’s pass to be worn all times
• Accompany visitor; sometimes CA/NDA
• Visible to anyone walking through a company’s
premises (type of machinery; layout; physical
handing of work in progress or finished
products)
• Overheard conversations
• Documents left in plain view
• Unattended waste baskets
Third Parties
• Sharing for exploitation
• Consultants, financial advisors, computer
programmers/professionals, web site host,
other independent professional,
subcontractors, designers, partners, joint
ventures
• Confidentiality agreement, Nondisclosure
agreements
Unsolicited Submissions (US)
• Formulate procedures to handle US
• Notify (in writing) all persons submitting
US disclosures that your company will
not enter into a confidential relationship
• Requesting the submitter to sign an
acknowledgement that your company is
not obligated to use the US Information
and owes no duty of confidentiality
IP Rights: Patents
• Definition: A patent is an exclusive legal right granted
for an invention that is:
– New (Novelty)
– Involves an inventive step (Non obvious)
– Capable of industrial application
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Duration: 20 years from filing/priority date
Territorial right
Requires disclosure/deposit of the invention/material
Can be licensed to third parties
Utility Models (or short-term patent): up to 10 years
IP Rights: Patents
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Patentable subject matter
Exclusions
Prior art/secret prior art
Utility/best mode/trade secrets
Depository institution
Employee inventions
Joint applicants/joint inventors/independent
contractors/joint owners
Patents
• Why apply for patent protection?
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Market exclusivity
To recover R&D investments
Facilitates licensing
Advantageous negotiating tool
Financing opportunities (venture capitalists, etc)
Favorable image and credibility
Freedom to operate
Higher market value and publicity
International expansion
Patents contd...
• First to file/first to invent: Laboratory
books/Drawing
• Accelerated examination
• Dependence and multi-patent products
• Front page, description and drawings
• Claims; technological density and claim
breadth/Route of filing/amendment of
claims
Problem-Solution Approach
• Definition of closet prior art
• Objective identification of technical problem
• Examination, whether solution obvious from prior
art
Patent Office may contrast closest prior art with
technical effect of invention; definition of
“objective problem to be solved” is different from
problem defined in original application
Choice of prior art affects whether obvious or not
Case study on
patent protection
• Case study on the commercialization of a patented
product
– Croatian pharmaceutical company (Pliva) discovers new
antibiotic (azythromicin)
– Pliva applies for patent protection in Croatia and in
various potential export markets
– Large pharmaceutical multinational Pfizer searches patent
databases and discovers the Pliva patent
– Pliva licenses Pfizer to produce the antibiotic in the US as
well as in some other countries in Western Europe while
Pliva maintains the exclusive right to commercialize the
antibiotic in Eastern Europe