When an invention comes to the
attention of a strategic IP manager s/he asks, “Is a
patent the best way to protect this?”, “Is it worth the
costs?” and “Is it worth the risk?”.
The risk is that your application never
matures into a granted patent. Your application, in which you
divulged the best way to practice your invention, is published 18
months after it's submitted and anyone can practice it if you don't
get it patented.
If the invention could be practised
in-house (say, a means of manufacturing) and the product not reverse
engineered easily, the IP could be maintained as a trade secret
instead of risking it through the public scrutiny of patent
There's no certainty that you'll get a
patent but there is certainty that you will not get a patent
if your invention, specified in the claims you’re drafting, is
described in the prior art or obvious in view of the prior art.
What's an IP manager to do? Strategic IP managers search for prior
Looking for trouble
Some are of the
opinion that you should not search for prior art because it's
an extra cost, there is no guarantee that it will be complete (the
patent examiner might find something missed), it delays filing so
you'll get a later priority date, the patent office will conduct a
search anyway and, ironically, if you uncover prior art relevant to
your application, you must divulge it to the patent office in your
application. All that is true but it is wrong to conclude that you
should not search before you submit. Here's why.
The legal fees associated with submitting a patent application are an order of
magnitude higher than the fees charged by a search professional so it
is “penny wise and pound foolish” to dismiss a search due
to the costs
Concern about receiving a later priority date is an excuse for any sloppy, rushed
job. That's a bad strategy. Applications should be submitted
promptly not quickly.
It's true that even the best search professional cannot guarantee that an examiner
won't find something missed in the pre-submission search.
(Information in the public domain is constantly increasing and the
examiner has access to prepublication applications not available to
the searcher.) But the point of a search, is not to prove there is no
prior art, but to prove there is! Of course it's bad news if a search
uncovers prior art but you save a lot of money by “failing
early”. If a “hit” is found that will destroy your
novelty or non-obviousness, you will not hire an attorney to prepare
the application, so money is saved. And the IP is saved too –
maintained as a trade secret.
A professional searcher finds “documents of interest” which may or may
not be Prior Art. To kill your claim(s), the document(s) must provide
a description sufficient to teach the invention to a person “skilled
in the art” (the average worker in the field) of the subject
matter you are claiming. Searchers are experts in databases,
categories and fields but cannot be skilled in all the arts
So, if a searcher finds a “hit” –
don’t panic. Get conformation from an expert. Patent attorneys
and patent agents are NOT experts in identifying and interpreting the
prior art. They are experts in writing and interpreting patent
claims. Your Chief Scientific Officer would be a good choice but
probably is also an inventor, co-inventor or otherwise biased. If you
must, find an outsider skilled in the art, get a Confidentiality
Agreement in place and ask, “does this paper describe the
invention in these claims we're drafting?”.
If the answer is “No, and here's why ... ”, then you should think about getting a patent to protect your invention (assuming it could prove profitable).
If the answer is “Yes”, you might be able to patent it if you can limit your claim(s) in such a way as to differentiate them from the Prior Art.
Of course, if you limit the claims (which you'd have to do, anyway, once the Examiner sees the Prior Art), you reduce the coverage of the claims, so the newly defined invention might no longer provide the protection you want.
Some IP managers might suggest filing the application anyway - hoping the Examiner doesn't discover the prior art that you discovered. This is not strategic IP management. It's gambling, foolish and ignores a glaring dilema. It's a gamble that the Examiner won't find the prior art that you or your searcher found. There may be a statistical value you could attribute to that gamble, but it's unlikely that you can predict the odds and that is the most foolish kind of gambling. This strategy presents a dilemna because "Each individual associated with the filing and prosecution of a patent application has a duty of candor and good faith in dealing with the Office, which includes a duty to disclose to the Office all information known to that individual to be material to patentability" (37 CFR 1.56) - such as “documents of interest”.
If that's the case, your best strategy is to continue to keep it a trade secret.
All patents start as trade secrets.
Trade secrets are information not known to the public which confer
economic benefits derived specifically from its not being publicly
known. Companies maintain these secrets by requiring its employees
sign an employment contract containing non-disclosure and non-compete
secrets, unlike patents, do not require a lawyer and nothing is
submitted so a trade secret can be in effect immediately and costs
nothing. Unlike patents, trade secrets do not expire, but the a
competitor might independently discover it, duplicate it and
commercialise it. That's the risk in trade secrets.
In the UK and its Commonwealth
offspring, trade secrets are regarded as an equitable right and
revealing them is a “breach of confidence ”. The
information must have the “necessary quality” of
confidence about it and it must have been disclosed in confidence.
Unauthorized use of that information to the detriment of the party
communicating it is a criminal act.
In the USA, trade secrets are protected
under state laws but the Uniform Trade Secrets Act (UTSA) of 1997,
has been enacted in all states except North Carolina (but its laws are
similar to UTSA), New York and Massachusetts. That simplifies
things. Also, the Economic Espionage Act of 1996 makes the theft or
misappropriation of a trade secret a federal crime!
Damages for trade secret misappropriation - by industrial espionage or through a former
employee (for example) can include both the actual loss caused by the
misappropriation plus the ”unjust enrichment”
caused by misappropriation. In trade secret cases, unlike patent
cases, the “reasonable royalty” damages measure is rarely
used because the “unjust enrichment” analysis almost
always leads to greater damage verdicts. A verdict of
misappropriation follows from evidence of access plus “substantial
similarity” – it does not require a showing that all the
elements have been copied, as in a patent.
Injunctive relief is the primary remedy
in a trade secret lawsuit because “a trade secret once lost, is
lost forever.” An injunction to prevent trade secret
misappropriation can be issued to prevent both the “actual”
or “threatened” misappropriation of trade secrets. The
“inevitable disclosure doctrine” provides the trade
secret owner the right to seek injunctive relief based upon the
“inevitable disclosure” of trade secrets against
head-to-head competitors even before there is any proof of actual
If you are considering trade secrets to
protect your invention, keep in mind that it must be a secret
globally. You cannot protect the IP by trade secret in one
country while allowing the secret to slip out in another. And you
certainly cannot patent it in one country and keep it secret in
Patent first then trade secret improvements
Don't file a patent application that withholds relevant information. Patent or trade secret. You can't have both.
Best Mode is still required!
Since the America Invents Act of 2011, failure to disclose the best mode is no longer a basis for invalidating or rendering unenforceable an issued patent
(35 U.S.C. 282(b)).
Previously, a common defence against charges of infringement was to assert that the patent application failed to disclose the best mode. If you could convince the judge (at the infringement proceedings)
that the patent was obtained under the false pretence that it divulged the
best mode, the patent would be ruled invalid. The applicant would be
guilty of inequitable conduct, having breached the applicant's duty
of candour and good faith to the USPTO, while applying for a patent.
Under the current law, insufficient disclosure is no longer an allowable defence against patent infringement.
However, the law retains the best mode requirement.
It is still a statutory requirement that applicants disclose the best mode of practising their inventions in patent applications.
35 USC § 112, still states that a patent applicant must "set forth the best mode contemplated by the inventor of carrying out his [or her] invention."
It is true that the best mode defence was the primary means of enforcing the best mode requirement but patent applicants and practitioners will likely continue to disclose the best mode of practising inventions in patent applications.
Applicants must sign an oath or declaration acknowledging their duty to provide all information material to patentability.
Best mode is material because it is a requirement for patentability (35 USC § 112), and failing to disclose the best mode would result in the PTO not issuing the patent.
Submitting such an oath that the applicant knows is lacking the required best mode disclosure could be construed as a false representation.
It could subject the applicant to criminal sanctions under the Federal Fraud and False Statements Statute.
Patent practitioners (patent lawyers and agents) are subject to strict ethics rules that prevent them from submitting
an application they know conceals the best mode. An applicant would find it difficult to conceal, from his own representative, the best mode while working together to write the disclosure and construct the claims.
Practitioners who aid inventors in concealing the best mode risk disciplinary action by either the PTO or the practitioner’s state ethics board.
If the inventor develops a
better mode after submitting the application, the better mode
can be held as a trade secret. There's no requirement that the
applicant update the application. Therefore, a good strategy would
be to develop an invention “good enough” to be novel and
non-obvious, submit the application and then get back to the lab to
find ways to improve it. Keep these innovations as a trade secret.
People who fail to think strategically about IP, and who have a
knee-jerk reaction to file applications, will file a “continuation
in part” (CIP). In most cases, it would be better to keep that
as a trade secret.
That's strategic IP management.
(© Dr Jamie Love 2015)