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Business Strategies

Should my company keep its important developments as trade secrets?

Some say a company’s most important assets are kept in its employees’ minds. Retaining those assets as trade secrets is a challenge due to the mobility of today’s workers and the potential for disclosure to new employers. The U.S. and foreign patent systems provide a mechanism for protecting new developments by granting limited monopoly rights, in exchange for disclosure of how to practice an invention. Careful consideration should be given to the tradeoffs between the requirements of full disclosure in patents and the risks of trade secrets.

Someone wants to license my invention. What do I do?

The best course of action is to establish a written agreement with the interested party based on negotiated terms. The agreement should identify the technology, specify the rights granted to the interested party (such as the right to make and sell the invention), set forth the financial terms (such as a royalty rate based on quantity of units sold or total revenue), and set a term. The rights may be exclusive, where only one party has rights to the invention, or non-exclusive, where multiple parties can have rights to the invention under other agreements. A patent is particularly suited as a mechanism for defining the boundaries of the granted technology. Patent protection should therefore be obtained on an invention as early as possible.

I recently developed a unique software application. What intellectual property protections are available to me?

Protection of your intellectual property in software can take many forms. Source code, on-screen artwork, and packaging design may be protected by obtaining federal copyrights. Software may be patented if the computing device on which the source code operates produces a useful, concrete, and tangible result. Additionally, methods of doing business, such as on the Internet or through specific software and hardware implementation, may also be patented. While patenting requires full disclosure of the software to the public, it can instead be protected via trade secret law. The software owner must be confident that the source code would ordinarily not be obtained through reverse engineering or unauthorized employee disclosure. Finally, the commercial name of a software application may be protected through trademark law.

How do I stop all of these junk e-mails from jamming up my inbox?

The CAN-SPAM Act or Controlling the Assault of Non-Solicited Pornography and Marketing Act was made effective in January 2004, and this Act includes new rules for those sending you these unwanted e-mails (spam). The Act provides penalties enforceable against these “spammers,” and explains the recipient’s rights. These spammers are now required to: accurately identify themselves; provide their physical address; identify the communication as an advertisement; remove misleading subject lines; and, importantly, provide the recipient with a way of “opting out” of receiving any future communications. Specifically, the spammer must provide the recipient with a link or response mechanism for use in automatically “opting out” of receiving future communications, or types of communications. The penalties for violation of the Act include fines and even imprisonment, dependent upon the spammer’s activities. There are also local laws governing unsolicited e-mails in Pennsylvania.