What can trade secrets be used to protect?

What types of intellectual property can be protected as trade secrets?

Trade secrets protect:

Information and/or ideas that: 1) have actual or potential economic value if they are kept secret;

2) cannot be easily ascertained by others who are using proper means; 3) are minimally novel;

and 4) are the subject of reasonable efforts to maintain them as secret.

Trade secrets are an excellent choice for protecting an invention or discovery that does not meet the rigorous novelty standards of patent law, so long as it is not easy to reverse-engineer. They are also ideal for certain types of software, tests, recipes, and other intellectual property that is possible to keep secret. Trade secrets can be among the more versatile types of protection, and are the only way to protect ideas, as opposed to the expression or physical embodiment of those ideas.

Trade secret protection can be combined with copyright or patent protection (at least until the point of patent registration). Trade secrets can also last indefinitely, so long as the material is kept secret.

Well-known intellectual property protected as trade secrets include the formula for Coca-Cola and the recipe for Thomas English Muffins’ “nooks and crannies.”

What kinds of intellectual property are not protectable as trade secrets?

Anything that does not have actual or potential economic value cannot be a trade secret. A person’s diary may be secret, but it cannot normally be a trade secret (though a scenario involving a famous person or company owner can be imagined). There are other laws that would allow people to keep an unpublished diary private, but it is likely not a trade secret.

Anything that does not lend itself to being kept secret, cannot be a trade secret. For example, if your company sells a product that can be taken apart, studied, and recreated (i.e., reverse engineered), the product design cannot be maintained as a trade secret. On the other hand, if your company has a special process for making the product more efficiently that is not obvious from reverse engineering, that process may be maintained as a trade secret.

A trade secret must be in some way novel, even if it is not sufficiently novel to meet the requirements of patent law. This is, when you think of the “secret” part of trade secret, quite sensible: something cannot be secret if it is not new to the people you are keeping it secret from.

Finally, it is not possible to protect something as a trade secret if no one bothers to make the effort to keep it secret. Whether the efforts to keep something secret are sufficient depends on the nature of the trade secret.

Some parts of this post originally appeared on my law firm blog, the Web 2.0 Law Blog.

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