Patents trade secrets_eng_graves_cleantech_open_academy_2012

Patents and Trade Secrets for Early-Stage Clean Tech Ventures

Peter EngCharles T. Graves

June 22, 2012

2 Cleantech Open Confidential Information – All Rights Reserved

Why Care About Intellectual Property and Licensing?

• Secure Rights / BuildValue

• Avoid Misappropriation / Infringement


Intellectual Property Life Cycle

M&A/Exit!

University/Former

Employer

AdditionalIn-Licenses/Acquisitions

Products/Services

Out-Licenses

Founders(Assignment)

Employees(Invent. Discl./Confid. Agts.)

The Enterprise


Issues for Founding Team

• Conflict with Rights of Former Employers

• Assignment of Founders’ Rights into the Company

• Other Contributors?

• Third Party Rights


Categories of Intellectual Property

• Trade Secrets

• Trademarks

• Patents

• Copyrights


Trade Secrets

• Protect Secret Information• Avoid Allegations of Misuse• Take Care When Hiring• Examples:

– Source Code– Manufacturing Process– Customer Lists– Product Roadmap


Trade Secrets: Maintenance of Secrecy

• Marking Documents

• Security Procedures – Sign-in, Badges, Restricted Visitor Access, Employee Exit Interviews

• Agreements

• Data Security


Trade Secrets: Best Practices

• Disclosure May Kill the Trade Secret• Reverse Engineering and Independent Development• General Knowledge and Skills of Employees - Cannot be

Owned

• Risks: Injunctions and Damages• Create a Policy for Employee Hiring and Departures


Patents: Subject Matter

• Apparatus

• Design Patents

• Business Methods A B

• Process


Patents: How Obtained

• File Application with Patent Office (PTO)

• Timeliness/Filing Date

• Patentability Requirements, E.g.:– Novelty – Nonobviousness – Description

PTO


Patents: Summary of Deadlines

U.S. Statutory Bars No Patent, if More Than One Year Prior to Filing Date:

• Patented

• Printed Publication

• Public Use

• On Sale

Most Other Countries: Absolute novelty – file before invention becoming public. No grace period. Use your US filing date for priority if file within 1 year.


Patent Tradeoffs

• Requires Application (High Cost)

• Right to Exclude/Not Right to Practice

• May Cover General Methods

• Independent Development May Infringe


Government Generally Does Not Require Ownership of Intellectual Property Rights

Bayh-Dole ActApplies to broad categories of Government funding agreements.Funding recipient generally has the ability to retain title to patent rights.

• Waiver Requirement for Ownership– Small businesses can retain ownership– Large businesses need a waiver

• Disclosure and Filing Requirements • Government’s Retained Rights - License back to practice “for or

on behalf of the United States.” Continued…


Government Generally Does Not Require Ownership of Intellectual Property Rights (cont’d)

Bayh-Dole Act (continued)

• Preference for American Industry – but can be waived.

• “March-in Rights”– Government has never exercised.

• Subcontractor Title Retention - Subcontractor’s inventions vest in the subcontractor (to the exclusion of the funding recipient); can be negotiated.


Licensing

• Grounded in the Concept of Intellectual Property as an “Exclusive Right”

• What are the Licensed Rights (e.g., patents, copyrighted works, etc.)?

• What are the Licensed Products/Activities?


Other Negotiated Terms

• Exclusivity

• Royalties

• Ownership

• Term

• Commercial Terms: Supply, Support, etc.

• Other

Wilson Sonsini Goodrich & Rosati650 Page Mill Rd

Palo Alto, CA 94301-1050T: 650-493-9300F: 650-493-6811

w: www.wsgr.comCharles T. Graves Peter Eng

T: 415-947-2109 T: 650-320-4847E: [email protected] E: [email protected]

Patents trade secrets_eng_graves_cleantech_open_academy_2012

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