One of the first decisions that the owner of a prospective trade secret must address is whether to seek patent protection or trade-secret protection. The advantages of trade-secret protection include the following:
1. Trade secrets cover a vast array of subject matter
2. Matter that can be protected by trade secrets is not limited to patentable subject matter
3. There is no set term limit for trade secrets, so trade-secret protection can last as long as the trade-secret holder can keep the secret
4. Trade secrets are generally less expensive than patents to obtain
5. There are no registration procedures for trade secrets
Trade secrets also have the following disadvantages relative to patents: (1) trade-secret protection only lasts as long as the trade secret remains secret; and (2) trade secrets can be reverse engineered.
The fact that a trade secret can be reverse engineered is a significant disadvantage. There is no legal barrier to stop a competitor from purchasing a product that is covered by a trade secret and figuring out how to produce the product on its own. Consequently, trade-secret protection is usually impractical for protecting products. In addition, there is no legal limitation that prevents a competitor from independently discovering the trade secret.
Patent or Trade-Secret Protection?
Thomas Joseph is a patent attorney in Pittsburgh, Pa. He maintains a solo practice in all areas of intellectual-property law. He has been practicing since 2001. Before starting his solo practice, Joseph was the General Counsel of Grant Street Group, a financial software firm. At Grant Street Group, he managed the company’s patent litigation against its primary competitors in the online-auction markets for tax certificates, foreclosures, tax deeds and municipal bonds. Joseph received a Bachelor of Science in Metallurgical Engineering and Materials Science from Carnegie Mellon University, a Master of Science in Materials Science and Engineering from the University of Florida and a Juris Doctorate from George Washington University.
You can contact him at www.joseph-iplaw.com.
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