Prior User Rights Study Report to Congress - America Invents Act

Thus, the USPTO finds that:Finding 7:A prior use defense to patent infringement is Constitutional and lawful and thedefense is consistent with the Constitution and Supreme Court precedentrecognizing that trade secret law and patent law can and do legally co-exist in theUnited States, and indeed have co-existed since our Constitution was created.2. The Relationship between Trade Secret Protection and Patent LawSomewhat related to the issue of the legality of the interplay between trade secret protection andpatent law is whether a prior use defense to patent litigation strikes the appropriate balance between thetwo forms of intellectual property protection. One of the goals of the patent system is to enrich the fundof human knowledge through the timely disclosure of new technologies; trade secrets, by their verynature, do not accomplish this goal. 244 Some of the comments contend that providing prior user rightsthwarts the aims of the patent system by favoring secrecy over disclosure. 245 The comments furtherargued that the grant of “co-exclusive rights” between the prior user and the patentee erodes the value ofpatents. 246 The problem, however, as pointed out in many of the comments, is that the patent system maynot provide the right economic or strategic fit for each class of innovator or for each type of invention. 247Several of the comments noted that it is not economically feasible for certain businesses,particularly small- and medium-sized enterprises, to seek patent protection for every innovation theymake. 248 For this class of innovators, a trade secret may be a cheaper alternative to a patent, one that244 See Kupferschmid, supra note 9, at 231 (addressing the argument that favoring trade secrets undermines thedisclosure inducement theory underlying the patent system).245 See Comments of Wis. Alumni Research Found, supra note 195, at 2-3; Comments from P. Martin Simpson, Jr.,Managing Counsel, Regents of the Univ. of Cal., to Elizabeth Shaw, IP Research Specialist Supervisor, USPTO,Office of Policy and External Affairs, Prior User Rights Written Comments 1 (Nov. 7, 2011),http://www.uspto.gov/aia_implementation/pur-2011nov07-university_of_ca.pdf; Comments of Tony Tether, supranote 183, at 3; Comments of Various Higher Educ. Ass’n, supra note 194, at 2.246 Comments of Wis. Alumni Research Found., supra note 195, at 3; see also Comments of Various Higher Educ.Ass’n, supra note 194, at 1 (arguing that prior user rights reduce certainty of patent rights, which impacts the abilityof universities to license patents).247 See Comments from Google and Verizon, supra 173, at 9-10 (noting that due to circumstances in the hightechnology area, choosing trade secret protection over patent protection may make more economic sense);Comments from Coalition for Patent Fairness, supra note 47, at 2 (arguing that not every business has the resourcesto patent every development); Comments of Greentech, supra note 47, at 1-2 (explaining that because manyinnovations in this area tend to be manufacturing processes, reliance on trade secrets over patents is an importantstrategic tool).248 See, e.g., Comments of the Computer & Commc’ns. Ind. Ass’n, supra note 185, at 3-4 (noting the substantialinvestment required to prepare and file patent applications, and the economic consequences of pursing an ideal ofpublic disclosure over other forms of protection).45