CENSIS white paper: Intellectual Property in Business

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Intellectual Property in Business: IP basics, IP management, IP strategy IP Management during Growth (continued) Does this all mean that patents oppose trade secrets, and vice versa? Not necessarily. Patents and trade secrets can be very well combined to comprehensively protect valuable information. For example, patents are suitable for protecting broad ideas (‘platform’ solutions), whereas trade secrets are convenient for protecting details of processes and methods. 28 One additional point may be whether the invention is disclosed by the selling of a product. For example, a background algorithm run on a remote server may not be part of the product itself, thereby remaining confidential even after the product is sold. This may serve as an argument for keeping the information as a trade secret. At the same time, some visible features of the product that constitute an invention and meet the legal requirements of patentability, could be protected with a patent. The questions in Table 8 should facilitate taking a decision about the most appropriate protection for a solution at stake. Some of them can be answered only upon consultation with a patent attorney. Table 8: Guiding questions for deciding about IP protection 1 Is the invention patentable at all? 2 Does it meet the legal requirements of non-obviousness, novelty and usefulness to be granted a patent? 3 Will the invention be useful beyond 20 years? 4 Is it possible for other companies to reverse-engineer it or do a workaround? 5 Is the invention detectable and embedded in the product itself or is it part of an internal manufacturing process? 6 Is the invention likely to be independently discovered in the near future? 7 Is the product regularly observed in public settings? 29 (NB It may only need to be observed publicly once to destroy novelty.) 28 Ibid. 29 Lobel (n 7). 26
Intellectual Property in Business: IP basics, IP management, IP strategy IP Management during Growth (continued) 11 Territoriality of certain IP rights and its ramifications Territoriality is a characteristic of registerable IP rights that is critical not only to expanding an IP portfolio but also to supporting your business case. Territoriality refers to the countries (territories) where an applicant decides to apply for a specific IP right. This feature applies to patents, utility models (if this legal form is available in a country), trade marks and designs. The decision about territories for IP protection can bear long-term consequences and the ‘danger’ can arise from a specific time window ascribed to each application process. The problem arises when countries that initially did not seem promising for the business then come to seem relevant at a later point. However, it is now too late to include them in the application process, because that procedural window has been closed. This applies especially to patents. It is not uncommon to discover the potential of foreign markets and to establish reliable business channels in these territories much later than application procedures allow, even if an IP attorney creates a way to extend that window. The choice of countries should follow from the business strategy, market and trend analyses. It should also take account of the political and legal situation in the target markets (e.g., stability, enforceability of IP rights). The choice also requires a certain dose of business ‘intuition’ though it should always be a fact-driven and educated decision. The information that may be relevant to consider is shown in Table 9: Table 9: Business aspects to consider for patent territories 1 Countries where you manufacture your products 2 Countries where your competition manufacture their goods 3 The supply chain – how does it look? Where are distribution channels located? (See also the section on Supply chain and IP) 4 Countries with end-customers for your product 5 The follow-up markets – which are they? Which countries are the most relevant? (Apply the questions above) 6 Budget restraints (they will force you to prioritise certain countries) Trade marks do not have a novelty requirement (as is the case for registered designs and patents), and they can be filed in new territories ‘as you go’, i.e., when you enter them. There are, of course, disadvantages to delaying, such as a third party registering a similar mark in a territory you have not entered into yet. But it is still different to patents where lack of novelty can kill an application if you miss the critical deadlines for extending protection internationally. Take-home message: Consult with your patent/IP attorney about which application procedure would be the most beneficial in terms of giving you time to decide about the national phases of the specific IP application. In cases where you missed out on including a specific country/ies in the application portfolio, consult your attorney about possible remedies. For example, you might consider filing a new patent application for some improvements or new features of the solution. 27
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