Trade Secrets

Not all inventions or other intellectual property will be protected by patents for a number of reasons. Some companies like Coca‑Cola have intentionally refrained from patenting their formula because of the limited 20‑year monopoly on the formula. After the patent expires, it falls into the public domain (these means it becomes public knowledge). In other cases, premature disclosure of an invention has nullified its patentability, or the cost of securing a patent may be impractical for a small business. Trade secret protection is an alternative means of protecting the secret.

A “trade secret” is the technical term for confidential business information that derives its value from being secret. Trade secrets include various assets such as sales models, distribution methods, customer profiles, client lists, supplier lists, product ingredients and formulas, etc.

Trade secrets can be used as an alternative form of IP protection when a patent is not otherwise available.

They can be enormously valuable to you whether you have developed new technology, designed original products, created the perfect recipe, or have a gold mine of customer data. Unlike other forms of IP protection, there is no formal intellectual property process for protecting a trade secret.

They can be enormously valuable to you whether you have developed new technology, designed original products, created the perfect recipe, or have a gold mine of customer data. Unlike other forms of IP protection, there is no formal intellectual property process for protecting a trade secret.

To protect and benefit from trade secrets, a business must:

  • Keep the business information a secret; and
  • Take all possible measures to ensure that the business information remains a secret.

The most practical way of protecting your trade secrets is to keep them absolutely confidential within the organization to those who have “a need to know”. If the trade secrets must be disclosed outside the protected circle, ensure you have a robust confidentiality agreement signed.

For more information, give us a call.