Patents and Trade Secrets: What’s the Difference?

Trade secrets and patents. Both seem to include highly secretive information, and information that is valuable to companies. That’s true. But Although there are similarities, there are also very distinct differences between patents and trade secrets.

Public Registration

A patent is an invention or design or process that is new or innovative. Patents, as they are registered with the United States Patent and Trademark office, are public, once they are registered. But although public, registering a patent tells the world that you own it and any attempt by anybody else to use, profit from, or claim as their own, your patent, will allow you to sue for patent infringement.

Keeping it Private

Trade secrets are different. In Florida, all you have to show to demonstrate that something is a trade secret, is that it has business or commercial value to you, and that you have acted to keep the trade secret private or at least, away from being disseminated into the public eye.

Something does not have to be “patentable,” that is, it doesn’t have to actually be a unique, never before invented, product or process, to be a trade secret, the way it would have to be to be patentable.

As a result, more than one person or company can legally have and use the same trade secret, so long as they both derive it or produced that trade secret, independently (that is, one didn’t steal from the other).

In fact, you can legally “reverse engineer” something that is a trade secret, and use it as your own, so long as you can prove you only relied on your reverse engineering. However, you cannot do that with a patent—if it is patented, you cannot use it without permission from the patent owner, even if you somehow reverse engineer it, or “invent” the patent by your own devices.

Should you Patent?

That begs the question of whether, should you patent something that you consider a trade secret, whether or not you will lose that trade secret protection. Trade secret protection relies on keeping information secret, but by patenting a trade secret you are now making that information public.

The answer is possibly. To the extent that something is patented—that is, readily discoverable by the public in a patent search—you could lose trade secret protection, but of course, you would gain patent protection, including the right to sue for infringement.

But any trade secrets behind the patent, that are not readily ascertainable by what is in the public patent application, would remain secret as a trade secret.

Patenting Someone Else’s Trade Secrets

Sometimes, someone will try to patent something, that is your trade secret. They may even be doing it unknowingly. Now, they have the protection of a patent, on or containing your previously developed trade secret.

If someone does try to patent what is your trade secret, you can ask the court for an injunction on the issuance of the patent. In the event that the patent application is approved, and you derived the now-patented information independently via your own trade secrets, you can also ask a court to enjoin the patent holder from suing you for infringement, allowing you to continue to use your trade secret, even in the face of a subsequently registered patent.

Call our Fort Lauderdale business law lawyers at Sweeney Law P.A. at 954-440-3993 for help today.

Sources:

usa.gov/agencies/u-s-patent-and-trademark-office

uspto.gov/ip-policy/trade-secret-policy