Protecting inventions is crucial to ensuring the economic benefits of innovation. Key information that an individual or company must keep confidential to maintain a competitive advantage is considered a trade secret. Trade secrets can include a wide range of information, including formulas, practices, processes, designs, instruments, patterns, methods or compilations of information. Some examples of trade secrets are recipes, manufacturing processes, software algorithms and client lists. To learn about how to license your intellectual property or use someone else's intellectual property, you can read Brown Rudnick's article on that topic by clicking here.
To qualify as a trade secret, the relevant information must meet the following criteria:
- The information is not commonly known or easily accessible to the public or other businesses in the field.
- The secrecy of the information provides the holder a potential economic benefit or competitive advantage.
- The holder of the information must take reasonable steps to keep the information confidential. This can include measures like non-disclosure agreements, restricted access and secure storage.
Trade secrets do not expire as long as the information remains confidential and continues to meet the criteria above. Unlike patents, trade secrets are not registered with any governmental body. Instead, they are protected against unauthorized use primarily through state laws, and in many cases under the federal Defend Trade Secrets Act (DTSA) in the U.S., which can provide remedies for misappropriation of trade secrets.
The relationship between a trade secret and a patent revolves around the trade-offs between secrecy and protection. Trade secrets, while providing a form of protection for proprietary information, have certain limitations, particularly in instances in which competitors can easily reverse engineer a given technology or when third-party partnerships require the sharing of proprietary information. Thus, patents provide an often necessary and strong mechanism for protecting intellectual property. The decision on whether and where to apply for a patent is a critical decision for all entrepreneurs seeking to protect their inventions. To learn about how to optimize the value of your intellectual property, you can read Brown Rudnick's article on that topic by clicking here.
In considering whether to apply for a patent, entrepreneurs should first determine whether their invention is eligible for patent protection. Generally, patents are granted for novel and non-obvious inventions – that is, anything that is truly unique and new.
There are several options available for a LatAm inventor seeking to file patent applications globally that provide the greatest protection period. One option is to file a provisional application in the United States, with the United States Patent and Trademark Office (USPTO). A provisional application establishes a priority date for any invention(s) disclosed in the application. The USPTO fee for filing a provisional application is typically under $300 USD and has very few requirements. For example, the provisional application can be a series of slides, graphs, or drawings without any textual or formatting requirements. This allows an inventor to draft and file an application quickly and without extensive costs. The provisional application never gets examined and will not publish unless a later application claiming priority to the provisional application itself publishes.
The provisional application also stays "pending" with the USPTO for one year before it can no longer be claimed for its priority date (with limited exceptions). Advantageously, this provides inventors with a full year to raise funds, negotiate partnerships, generate data, and make a decision on whether to proceed with the application without losing their rights. After that year, the inventor can then file an international patent cooperation treaty (PCT) application and/or national patent applications (specific to a given country or jurisdiction in the world) claiming priority to the provisional application (i.e., "non-provisional" applications). Notably, that one year also does not count toward the exclusionary term of the patent. Rather, only the date of the earliest non-provisional application will be used in calculating when the patent expires. As a result, effectively, inventors will have up to one year from the date of filing the provisional application to further develop their invention and harmonize their patent strategy for subsequent filings.
Although a provisional patent application is specific to the U.S., it can be used as a basis for priority when filing patent applications in other countries, as long as these are filed within 12 months of the provisional filing date.
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