There is no doubt that the number of patents declared as potentially essential to technical standards is not an indication of essentiality; its only purpose is to make those declared patents accessible on FRAND terms should they ever become essential. Tim Pohlman, founder of IPlytics a commercial technology consultancy, participated in an empirical study and report of essential patents commissioned by the European Commission (Tender No ENTR/09/015 (OJEU S136 of 18/07/2009)). In December 2016 his consultancy, released a 62 page report on SEPs commissioned by the EC. The report was the result an heroic effort to sort through and normalize patent declaration data for all widely adopted standards (See Fig. 1). This work was (and is) important and should not be under-valued. It has long been recognized (e.g., n.10), that patent declaration information “can be hard to find,  the links are often messy, and standards often see improved, updated releases.” On the back of the data the IPlytics team has been collecting about patents declared as potentially essential and 3GPP documents, they have been issuing privately-commissioned reports discussing their data as well as their analysis of the data in greater detail. Their recent reports on 5G have been widely discussed in the media and at conferences.
In my prior article addressing confidentiality agreements, I reviewed how to identify a company’s intangible assets and how to protect them with an NDA. This article will continue the discussion of preparing an NDA.
When preparing a confidentiality agreement it should go without saying – but it often needs to be emphasized – that a company should take the following steps:
- Treat the company’s portfolio of confidential information as a valuable business asset. Confidential information can be used and shared more effectively and securely, to the greater benefit of the business, if the company routinely takes stock and assesses the value of its information assets.
- Implement and adhere to company-wide information and data security policies, systems, and procedures. This includes at least:
A uniform confidentiality and proprietary rights agreement signed by all employees;
An information technology and communications systems policy that governs employees’ appropriate use of company confidential information;
Robust physical and electronic security measures, which should be regularly tested, audited, and updated;
Systems and processes to monitor and detect unauthorized disclosures of confidential information; and
Contingency plans and procedures to address any leaks that are detected, including notification of other parties whose information may have been disclosed in violation of applicable confidentiality arrangements and mandatory notification of individuals whose personal information is compromised.
- Comply with contractual obligations governing others’ confidential information. A company may be challenged with respect to this issue though:
Clear nondisclosure obligations, that may, for example, preclude sharing protected information with subcontractors;
Restrictions on use of the information, that may limit using the information for a stated purpose like evaluating a business deal, or fulfilling contractual obligations like manufacturing a particular product;
Restrictions on access to the information within the recipient’s business and among its employees – typically, employees are allowed access to confidential information on a need-to-know basis – on this front the cooperation of a company’s human resources department is key;
Physical and electronic security requirements, which might be more stringent than the recipient’s policies and procedures applicable to its own confidential information; and
Obligations to return or destroy original materials containing confidential information or materials incorporating such information as per the applicable agreement.
- Protect certain confidential information as trade secrets. Confidential information may also be a trade secret. If so, it will be subject to the protections of relevant state or federal law. For example, any of the following information might be considered trade secrets: client lists; marketing plans; pricing information; business plans; manufacturing processes; formulas; software algorithms; source code; and inventions (at least those not disclosed through a published patent application).
- Comply with privacy and data protection laws and regulations. Certain kinds of personal information that are commonly held by businesses (such as employee records and customers’ financial accounts) may be subject to special requirements under various federal and state privacy and data protection laws and regulations.
Contact me today with questions or comments.
David L. Cohen, P.C. – Kidon IP
123 West 93rd Street
New York, NY 10025
While companies are starting to better appreciate the role trade secrets can play in underpinning their intellectual capital, proactive trade secret management is still a very much neglected activity. This neglect can ultimately lead to the loss of valuable trade secrets and the loss of millions of dollars of value and legal fees. The widespread failure of many companies to take reasonable steps to protect their information should give managers and their company directors much pause. Fortunately, the law is starting to provide a clearer picture of what needs to be done, and there are many providers well versed in both best practices and productivity tools that will enhance a company’s trade secret protections. Read more
One of the most important developments in the world economy has been the increased importance of ideas and innovation. It is no exaggeration to say that they comprise the predominant source of economic value in the world today. The challenge with ideas and innovations is that they are intangible — and as such, they are hard to protect and even harder to value.
Because IP monetization covers a wide range of business and legal activities, it is important to provide some examples.
Broadly, there are four categories of IP monetization:
1. The most straightforward is to get others — through negotiation or litigation — to pay (the IP owner) money for the right to practice or use your IP in exchange for cold, hard cash.
I am very pleased that Practical Law has published a piece I co-authored with Doug Clark and Eric Stasik that discusses anti-trust issues associated with Standard Essential Patents (SEPs) and considerations for counsel managing SEP licensing programs. The purpose of the article was to provide a high-level overview of the entire life-cycle of SEP management from creation to licensing/litigation.SEP Licensing - Dec19Jan20 PracticeNote
It consists of 5 short videos (between 4-9 minutes each). I hope viewers find it useful and informative.
In part 1, I reviewed patents and copyrights. In this post, I will discuss trade secrets, IP rights, and other protection measures.
No federal or state statute expressly addresses initial ownership of a trade secret as between a company and the employee or independent contractor who develops the trade secret. All US states, but New York, have enacted a version of the Uniform Trade Secrets Act (UTSA), which includes a trade secret definition substantially consistent with the definition under the federal trade secret protection statute, the Defend Trade Secrets Act of 2016. Under both federal and state law, trade secret protection is only available for business, financial, or technical information if: Read more
The outsourced manufacturing agreement should require procedures that limit access to the company’s confidential information to specific, identified manufacturer personnel and solely to the extent they need to know the information for performing the services.
If possible, the company should require the manufacturer to amend its employment contracts with individuals having access to the company’s confidential information to provide for confidentiality and non-compete obligations concerning this information. The outsourced manufacturing agreement should make the manufacturer directly liable to the company for any breach of these obligations. Read more
This post will provide an overview of key IP issues encountered when dealing with employees and independent contractors. We will cover the default ownership rules and rights for different types of IP and some tips on how to maximize an employer’s rights vis-à-vis its employees.
Intellectual property (IP) created by employees and independent contractors or consultants, particularly in a technical or creative role, can have significant value for a company. However, if not careful, a company may also be obligated to transfer ownership or permit the use of certain IP to customers, collaborators, or other third parties. Thus, it is important to understand how to protect an employer’s interests in it. Read more