IP.com CEO Speaking at PATINEX 2008

Johnson Kong, Executive Vice President and Head of Asia Pacific for IP.com Inc., is in Korea with Tom Colson, our CEO, who addressed an international group of thought leaders gathering at PATINEX 2008.

IP.com Inc. CEO Tom Colson's presentation was on Advanced Enterprise Management and IP Strategies.

The keynote address for PATINEX 2008 was by KAIST President Nam-Pyo Suh, who spoke on the Strategy of Patent Information Usage for Finding a New Market.

After this conference, Johnson Kong and Tom Colson are continuing on to Beijing and other centers in Asia that are regular stops for executives from IP.com Inc.

Readers can follow at @ipdotcom on Twitter, where we're following other leaders in the technology space, like Sun Microsystems CEO Jonathan Schwartz. Here's how Jonathan Schwartz explains how Twitter helps him run Sun:

"Communication is a key part of leadership—as CEO, I need to engage the market, inside and outside Sun, with whatever technology affords me the greatest possible reach. Through blogs, online news, social networking sites, or Twitter, the Internet has fundamentally changed how we communicate with one another. Today, we have thousands of employees participating, engaging customers and developers across the world, 24 hours a day. And whether it's via a half-hour streaming video or a 140-character Tweet, we need to reach everyone in the forum and format they choose—not what we choose."

We're working on it, but it's still early days in the integration of Twitter feeds into this blog. However, if you add @ipdotcom to those you're following on Twitter now, you'll be sure to hear more about the latest innovations in intellectual property management and IP strategies. We look forward to reading your "tweets" and following you, too, just like we're following Jonathan Schwartz and Guy Kawasaki on Twitter.

InnovationQ Features & Benefits

InnovationQ is an enterprise software platform developed by IP.com Inc. for clients that automates and streamlines common intellectual property management functions. If your organization has a substantial investment in intellectual property, InnovationQ can help you safeguard its intellectual property assets and make better decisions about those assets. More important, InnovationQ allows you to derive maximum value from your intellectual property portfolio. It helps you automate and enhance most of the major tasks associated with intellectual property management including protecting trade secrets.

In a series of posts here on our corporate blog, Securing Innovation, we've recently looked at how InnovationQ helps our clients manage important facets of their intellectual property assets in these four areas:

1. Invention Review Process
2. Trade Secret Management
3. Publication Clearance System
4. R&D Collaboration

InnovationQ Features

The Workflow Engine - The Workflow Engine is software that implements a document workflow process. Workflow processes are standard paths that a document is passed along for review and approval. These can be configured to meet more specific needs. Convenient options to delegate your responsibility or seek consultation on a specific document are available.

A Document Repository - A software platform that stores and organizes documents. It includes the following features:

  • Document storage and multi-categorization

  • Full text search

  • Document event tracking

  • Document event alerts

  • Reports of user and document activity

Collaborative Innovation - The Collaborative Innovation Module provides customers with the ability to send documents to other members of their team for comment and revision. It facilitates innovation through structured collaboration.

Roles-based Access Control – Administrators can develop different sets of permissions, or rules, which govern what a user (or groups of users) can do within the system.

Automated Invention Scanning/Scrubbing – Enables companies to rapidly align and evaluate technologies for consideration of further investment.

Integrated Prior Art Searching – Seamlessly search peripheral databases including IP.com’s Prior Art Database, U.S. patents and patent applications.

Legal Safeguarding – All documents loaded into the InnovationQ system are automatically date-stamped and digitally fingerprinted for verification. 

InnovationQ Benefits

  • InnovationQ helps make processes more efficient and less error prone
  • Offers a secure and legally defensible, document management environment
  • Extremely easy to use – dramatically reducing training time and costs
  • Quick to deploy – the web-based application requires no on-site hardware or software
  • Future enhancements – constant focus on solving the problems of innovation management from IP.com
  • InnovationQ allows you to mine your intellectual property for product ideas
  • InnovationQ provides a solid ROI. Thorough IP asset protection at a cost that is relatively low compared to the value of the assets

Dynamic Tools for Trade Secrets

What is a Trade Secret?

A trade secret is essentially technology that is maintained by a company in secrecy. Importantly, though, a trade secret is only enforceable if reasonable safeguards are in place to maintain its secrecy.

While many companies believe that patents are the cornerstone of their intellectual property portfolio, in reality, patents are expensive to obtain and more expensive to defend. Worse yet, 90% of all issued patents turn out to be valueless to the owners. The landscape has become even more treacherous since the Supreme Court has recently broadened the definition of “obviousness”. This will make patents harder to enforce. To combat this, savvy, innovative companies are leveraging trade secrets as an economic and strategic component of their IP portfolio.

An established Trade Secret allows a company to:

  • Prevent competitors from using the technology
  • Recover damages due to misappropriation
  • Prevent former employees from taking the invention to a competitor
  • Prevent unlawful disclosure of the trade secret

Failure to protect your Trade Secret(s) means:

  • Any competitor can freely use your technology
  • Departing employees can share your ideas with other companies
  • Loss of competitive advantage
  • Loss of market dominance

Key tools for effective Trade Secret Management:

1. Prevent the wrong people from accessing documents

  • Secure login and access control
  • Clearly defined user roles and permissions

2. Alerts of suspicious activity

  • Large number of document downloads, previews, etc
  • Unusual access such as off-hour, high volume downloads, etc.
  • Reports summarizing all user and document activity

3. Provide irrefutable proof at trial

  • All documents are legally safeguarded
  • Proof that documents have not been altered
  • Proof of secure access to the system by authorized users

To read more about dynamic tools for innovation management see this overview.

Blawg Review #179

We  are pleased to have the opportunity to host Blawg Review #179, the carnival of law blogs, here on Securing Innovation, the business blog of IP.com Inc. Today is a very special day for everyone interested in writings and discoveries that promote the progress of science and useful arts.

September 29th is Día del Inventor in Argentina where they celebrate inventors on the birthday of an individual inventor, much the same as National Inventors Day in the United States is celebrated on Thomas Edison's birthday -- but this particular invention is worthy of worldwide commemoration.

His new invention would sweep the world one day - and so too would his name.

Biro... Laszlo Biro.

No prizes, then, for guessing what his brilliant idea was.

The ballpoint pen is 70 years old this summer and Laszlo was its creator - a man with a vision and a stained shirt front.

He designed it in his garage in Buenos Aires. By the time he died in 1985, a millionaire aged 86, there was one in every pocket on the planet.

"What could be more beautiful than the ballpoint pen," said Eduardo Fernandez, president of the Argentinian Inventors Association, who are planning a celebration in Laszlo's honour on his birthday.

Happy Birthday, Biro.

In France, in 1945, a man named Marcel BICH, who had been the production manager for a French ink manufacturer, bought with his partner Edouard BUFFARD, a factory outside Paris and set up business as the maker of parts for fountain pens and mechanical lead pencils.

While his writing instruments parts business began to grow, the development of the ballpoint was advancing in both Europe and the United States and Marcel BICH saw the enormous potential for this new writing instrument.

After obtaining the patent rights to a ball pen created by Hungarian inventor, Ladislao BIRO, Marcel BICH introduced his own ball pen in December 1950. Touting his product as a reliable pen at an affordable price, he called it « BIC » a shortened, easy-to-remember version of his own name. The famous BIC® CRISTAL® ballpoint pen was born!

In 2002, the BIC® Cristal® ballpoint pen entered the permanent collections of the Museum of Modern Art of New York (MOMA), at the Department of Architecture and Design.

By 2005 BIC had sold its hundred billionth ballpoint pen.

 Intellectual Property News and Opinion

The American Intellectual Property Law Association will be holding their annual meeting at the Marriott Wardman Park Hotel in Washington, DC on October 23-25, where the team from IP.com will be available to meet and discuss how the latest enterprise software platform for innovation management,  InnovationQ, helps companies and their counsel to safeguard intellectual property assets and make better decisions about those assets.

Some of the world's largest and most innovative companies trust IP.com for Intellectual Property asset management, defensive publishing, and patent search services. So, we were interested to learn from the story of the invention of the ballpoint pen that Biro had neglected to apply for a patent in the United States for his ballpoint pen invention, or to manage his intellectual property as well as he might today with the management tools now available to inventors around the world via the Internet.

Groklaw reports that IBM has just announced a new corporate policy regarding its "behavior when helping to create open technical standards" and hundreds of comments follow in the ensuing discussion.

There has been a debate among legal scholars about whether patents were seen by the framers of the US Constitution as “property” or, as Thomas Jefferson charged, a monopoly “privilege.”

In a post titled Patents & Financial Meltdown on the Technological Innovation and Intellectual Property blog, the question is asked: "What happens when you give out lots of property rights, but nobody exactly knows what those rights cover? Yes, that might describe software/business-method patents and the result is costly litigation, disputes and a net disincentive for innovation."

The American Bar Association Section of Intellectual Property Law has launched Landslide™, a bi-monthly magazine that offers news and analysis on patents, trademarks, copyrights and related topics. Written by and for an audience of intellectual property lawyers, the magazine will cover this rapidly evolving legal specialization through an emphasis that includes business, technology, the arts, legislation and international developments.

“Increasingly complex, intellectual property law touches nearly every aspect of business, trade and commerce. This magazine will acquaint lawyers with both a wide and narrow scope on this emerging body of law, presenting articles written by some of the best minds in intellectual property,” said Joe Potenza, chair of the ABA-IPL’s Content Advisory Board. “We believe Landslide will be a force in the IP world.”

The first new magazine introduced by ABA Publishing in nearly seven years, Landslide is dedicated to sharing IP knowledge and experience acquired on the frontlines of legal practice, business, the arts and science, exploring national and international legal arenas.

Virtual Law Cover Story by Benjamin Duranske and Sean Kane in New IP Magazine “Landslide”

Patent databases continue to proliferate on the internet. On the Patent Librarian's Notebook, there's a comparison of free patent databases.

In a blog post titled USPTO/EPO clogs up the prosecution highway with red tape, David Pearce at IPKat notes that the EPO has just announced that the Patent Prosecution Highway (their capitals) is due to begin on 29 September. This scheme will allow patent applications that have been examined and allowed in either the USPTO or the EPO to be fast-tracked in the other office. The programme will run for a trial period of 1 year, after which the offices will assess whether it is worth being fully implemented.

Out-Law.com, from the international law firm Pinsent Masons, reports that the European Patent Office (EPO) was hit last week by a strike by staff who were demanding not better pay and conditions but the freedom to help create better quality patents. Joff Wild at IAM Magazine asks, "Where is the evidence to support EPO examiner union's claims?"

Duncan Bucknell's IP ThinkTank Gobal Week in Review is a comprehensive selection of top intellectual property news breaking in the blogosphere and on the internet each week, with the added value of a Pharma & BioTech Review this week.

IP Watchdog notes that Everyday Edisons is recruiting at Inventors Expo.

Patents

After the invention of the ballpoint pen that came to be known in many parts of the world by his surname, Biro kept tinkering. He reportedly recorded 32 inventions, including a washing machine device and an automatic transmission for cars that was bought by the German subsidiary of General Motors. The transmission invention might have secured Biro a wealthy life, but GM never used the patent.

Such was not the case with American inventor Robert Kearns, whose patent case of a lifetime against Ford and Chrysler is now the subject of a major motion picture, Flash of Genius, that opens in theaters this week.

The movie, Flash of Genius, is previewed on the Patent Baristas law blog by patent attorney Stephen Albainy-Jenei, who gives it two thumbs up based on subject matter alone:

Billed as educational while also inspiring and entertaining, the early reviews have been positive. The story is based on the true story of college professor and part-time inventor Robert Kearns’s (Greg Kinnear) long battle with the U.S. automobile industry and his fight to receive recognition for his invention. Kearns took on a battle that nobody thought he could win.

Kearns invented and patented the intermittent windshield wiper mechanism for use in light rain or mist and tried to license it to the big automakers. They all rejected his idea and then some went ahead and put intermittent wipers in their cars beginning in 1969. In 1967, he received the first of more than 30 patents for his wipers. He sued Ford in 1978 and Chrysler in 1982 for patent infringement.

Flash of Genius

Click the link on the movie poster above to watch the trailer. Hopefully, we'll get to read more reviews of this movie by other patent attorneys aspiring to be the next Siskel, Ebert & Roeper.

In this Friday IP Roundup at Patent Baristas, Albainy-Jenei notes:

Just a Patent Examiner has a rebuttal to the argument that patent reform is needed to prevent applicants from “wearing down” the Examiners. The theory is that by taking advantage of (or abusing) the unlimited continuations available to applicants, applicants can wring an undeserved allowance from an examiner simply by refusing to abandon the application. According to JAPE, this is wrong. Every time an applicant files an RCE (or a straight continuation), the examiner receives a count for the express abandonment, and another count for the first action after RCE. It also makes the Examiner’s job easier: “Speaking for myself, examining a continuation really does give me a serious head start.”

The United States Court of Appeals for the Federal Circuit clarified the law of design patents. Rebecca Hanovice at Sheppard Mullin's Intellectual Property Law Blog says, " In view of the Egyptian Goddess decision, patentees should be aware that infringers may attempt to rely on similar prior art designs to narrow the focus of the ordinary observer test to distinctions in the designs that might otherwise escape notice."

Jeremy Telman at the ContractsProf Blog notes that some fruit now comes with an end-user license agreement to protect the intellectual property.

They Invented What? Banana protective device.

Gene Quinn at Patent Fools pens Trolling: A Massive Redistribution of the Wealth.

Trade Secrets

In the U.S. we have civil causes of action under federal law for infringement of patents, copyrights and trademarks. Alas, we do not have a federal civil cause of action for trade secret misappropriation! But we need one badly! according to Jorda on Trade Secrets: the interface between patents and trade secrets.

Trade Secrets Derive From "Equitable Principles" Rather Than Property or Contract Rights, according to a recent case before the Sixth Circuit Court of Appeals cited by Jason Jarvis on the Trading Secrets blog of the Seyfarth Shaw law firm.

Judge awards $57 million in secrets theft but recovery of damages awarded is very unlikely. An ounce of prevention is worth a pound of cure.

Along with a recent post from the Annals of Chinese Economic Espionage, Womble Carlyle's Trade Secret blog has an interesting post about a former Intel employee who's been accused of misappropriating Intel trade secrets by downloading to his Intel- a host of confidential Intel documents, including 13 "top secret" company files containing highly sensitive design plans for future processor chips.

But what really got me up off my massage chair in the middle of the Bills vs.Rams football game of the week was news of a new Womble Carlysle Furniture Law Blog.This blog will focus on legal issues affecting the furniture industry with a particular emphasis on intellectual property issues.

Trademarks

Ballpoint pens are still widely referred to as a biro in many English-speaking countries, including the UK, Ireland, Australia and New Zealand. The term "biro" in colloquial British English is used generically to mean any ball point pen. Although the word is a registered trademark, it has become a genericised trademark. The company's intellectual property department keeps a close eye on the media and will often write to publications who use its trade name without a capital letter or as a generic term for ballpoint pens, in order to preserve its trademark, according to this article about Laszlo Biro in Wikipedia.

BIC Logo

Did you ever wonder where the BIC® logo comes from?

Green Patent Blog requests reconsideration of trademark application, argues "acquired distinctiveness" of its own blog name. It's no Likelihood of Confusion®.

Marty Schwimmer at The Trademark Blog has officially offered to file an application for TROUBLED ASSET RELIEF PROGRAM and catchy TARP logo, on behalf of the US Government, attorney fees waived.

Copyright

U.S. lawmakers approved the creation of a cabinet-level position of copyright czar as part of sweeping intellectual property enforcement legislation that sailed through the Senate on Friday. Ron Coleman at Likelihood of Confusion® asks, "...what can we do to at least try to get them to hire Bill Patry for the first copyright autocrat?"

In a post titled Sabine Dresses, Susan Scafidi at Counterfeit Chic tells incredible stories of identical twin sisters, bridezilla, and stolen wedding dress designs.

Walter Olson at Overlawyered picks up on a story from Cory Doctorow at Boing Boing about parody, nastygrams, and George Lucas of Star Wars, and ponders, "If only we could all resolve threatening letters from lawyers as neatly as the editors at MAD magazine were once able to do."

Cyber Law

Eric Menhart of CyberLaw PC discusses Political Domain Name Infringement.

As this election year heats up candidates in all types of political races are trying to reach likely voters at their doors, on their telephones and on the Internet. In this race for voters you might guess that a candidate’s domain name plays an important role in sharing his or her message with likely voters. What if a candidate’s domain name is already taken by a third party? What if a candidate’s name has already been taken by their opponent? Many of today’s candidates, finally recognizing the importance of a strong Internet presence in races for political office, are facing the reality of this intellectual property concern.

Brett Trout, author of Cyber Law: A Legal Arsenal for Online Business, discusses Internet fraud. So what is the most prevalent form of Internet fraud. Well, you might be surprised to learn that online auction fraud accounts for 44.9 percent of Internet fraud complaints referred to the FBI’s Internet Crime Complaint Center (IC3). This is more than twice the number of complaints received for the next highest category, check fraud (19 percent).

Postscript

By the way, here's an interesting article He Invented The Ballpoint Pen from Investor's Business Daily that's perhaps the best story about the invention of the ballpoint pen by Laszlo Biro that we found during the preparation of this presentation.

Reinventing the most popular ballpoint

'din-ink' by andrea cingoli + paolo emilio bellisario + cristian cellini + francesca fontana, 2007
shortlisted entry of the designboom dining in 2015 competition, a set of biccaps, including a fork-cap, a knife-cap and a spoon-cap, that replaces the normal bic cap during lunch time

Blawg Review has information about next week's host, and instructions how to get your blawg posts reviewed in upcoming issues. Of particular interest to everyone interested in Intellectual Property law and policy might be the November 10th presentation of Blawg Review #185 by Global Intellectual Property Strategist Duncan Bucknell at his indispensible IP Think Tank weblog.

Oh, one more thing...

This is simply birolliant - the incredible 10ft 'photographs' drawn with a ballpoint pen. They may look like pin-sharp photographs - but these amazing pictures are actually drawings created with the humble ballpoint pen. The stunning pictures, measuring up to 10ft high, were drawn by a rising star of the art world, Juan Francisco Casas.

 

Continue Reading...

Judge awards $57 million in secrets theft

"Serenex's intellectual property constitutes its most valuable asset," North Carolina Judge Stephens wrote in his court order awarding, for theft of trade secrets by former employee chemist Yunsheng Huang, $57 Million in damages to the Durham-based drug development company recently acquired by Pfizer.

According to news reports:

Serenex alleged that Huang stole experimental cancer treatment formulations and delivered them to business partners in China. As the case unfolded in Wake County last year, Huang fled to the People's Republic of China, according to court documents.

The corporate espionage case highlights a particular vulnerability of the Triangle's research-and-development firms. The financial value of their research depends on secrecy.

Serenex went to elaborate lengths to protect its trade secrets, including devising internal code names for proprietary chemical formulas to fool computer hackers..

But, as is often the case, the greatest vulnerability of trade secrets was not computer hackers but the "inside job" of a company employee.

Serenex was the victim of corporate espionage carried out by Yunsheng Huang, a former Serenex chemist and, it is alleged, Tongxiang Zhang, a member of the Chinese Communist Party who runs the Chinese companies to which Huang delivered the Serenex trade secrets.

It is doubtful that the company will ever recover any of the judge's award for the damages determined to have been suffered by this theft of trade secrets. It's no comfort to the shareholders that the company has this award against individuals it can't actually bring to court for the loss of what the judge termed its most valuable asset, its intellectual property.

Clearly, there's a need for effective proactive protection of trade secrets to ensure that such valuable assets are not able to be taken from a company in the first place, leaving management to chase a former employee internationally only to recover a worthless award of damages.

Exec Pleads Guilty to Stealing Trade Secrets

Law.com reports that an executive who worked at IBM for nearly a decade pleaded guilty to stealing trade secrets about the company's pricing and trying to pass them off to his superiors at rival Hewlett-Packard  when he took a job there. Atul Malhotra, 42, faces up to 10 years in prison and a $250,000 fine on the single count of theft of trade secrets, prosecutors said.

The Wall Street Journal Law Blog apparently got through to John Vandevelde, Malhotra’s attorney, who reportedly called his client “an honorable man with an impeccable record” who “made one mistake in transitioning from one high-tech job to another.”

It's noted that HP and IBM cooperated with the prosecution in this case. HP said it detected the activity, fired Malhotra and turned the information over to law enforcement. His employment at HP lasted five months. IBM declined to comment on the case.

News of the guilty plea in this criminal prosecution was posted on Trading Secrets, the new law blog authored by the attorneys of the Trade Secrets, Computer Fraud, & Non-Competes practice group of Seyfarth Shaw LLP, who protect and defend clients against those who improperly handle proprietary information, violate non-compete agreements, improperly solicit customers or remove electronic data from businesses, and raid employees. This looks like a great new intellectual property law blog, so we've added a link to Trading Secrets in our list of IP Blogs in the sidebar on the left.

It's always big news whenever an executive is caught stealing trade secrets, sometimes with the cooperation of companies as competitive as Coke and Pepsi. Savvy companies would much rather protect their trade secrets and not rely on the goodwill and ethical management of their biggest competitors to prevent the loss of valuable intellectual property. After all, a trade secret is only enforceable if reasonable safeguards are in place to maintain its secrecy.

We're unabashedly enthusiastic about IP.com's effective technical solutions that secure innovation and protect intellectual property. InnovationQ provides key tools for effective Trade Secret Management that enable proactive, innovative companies to secure trade secrets as an economic and strategic component of their IP portfolio.

Others might rely on criminal prosecutions, lawsuits against competitors and former employees, and voluntary water torture to discover leaks.

Eco-Patent Commons Technical Disclosures

In her Strategic Thinking column on GreenBiz.com, Nancy Edwards Cronin recommends Growing the Eco-Patent Commons to Truly Promote Green Innovation. While lauding the objectives of this green initiative, she suggests that the Eco-Patent Commons itself is in need of some innovation if it truly hopes to accomplish its goal: sharing useful environmental technologies for "the greater good."

The problem is that the project includes only "patents" and not the undisclosed innovations and trade secrets within the intellectual property of companies and independent inventors that have not yet been patented. Many of those inventions might better be published now to promote the progress of science and the useful arts for a sustainable environment and ecology for the future.

To compensate for these drawbacks and make the Eco-Patent Commons as useful and powerful as it can be, the initiative requires expansion to offer truly recent inventions that have not spent years in the patent application process. This involves widening the scope of the initiative to include non-patented inventions that have yet to be marketed and made public.

One way to make these inventions available is through enabled invention disclosures. An enabled invention disclosure (also called “defensive publication” or “technical bulletin”) is a written description of an invention that ideally has the same degree of detail as an issued patent. Therefore a well-written invention disclosure provides sufficient information to the reader to understand and use the invention.

Many companies successfully use enabled invention disclosures as part of their intellectual property (IP) strategies. Companies frequently have inventions that they do not wish to patent because the patent process is so expensive, including invention development costs, legal preparation and patent prosecution fees. However, companies also wish to prevent competitors from patenting those same inventions.

By using enabled invention disclosures to publish the invention, companies accomplish both goals: they save the cost of patenting but they also establish a “prior art bar” to obtaining the patent and make it impossible for competitors to claim it the invention as their own. Several Web site forums exist for publishing inventions, including www.ip.com and www.researchdisclosure.com.

The Eco-Patent Commons should be expanded to include these enabled invention disclosures. Many inventions that companies deem non-strategic for patent application and instead decide to publish may be excellent candidates to be donated to the Eco-Patent Commons. These published inventions would be truly new, fresh and useful -- a good first step to creating the true springboard for green innovation that the Eco-Patent Commons was meant to be.
We couldn't agree more.

As indicated in our original post about the Eco-Patent Commons, IP.com would really like to contribute to this very worthwhile initiative by providing the publishing platform to broaden the scope of the project to include innovations and inventions useful to the environmental movement well beyond those patents that have been contributed by the project's founding companies, some of which are already using the IP.com Prior Art Database. We've got technologies available that could very quickly take this green initiative to a whole new level of global participation.

Let's discuss.

Managing Trade Secrets for Legal Security

It's interesting to see the growing number of Fortune 500 companies and Global 1000 businesses with blogs by CEO and other senior level executives who are blogging for their companies.

Today, we discovered another, The Manufacturing Industry Blog by Lynette McTigue, the Global Industry Marketing Manager for Xerox Global Services. On that corporate blog, Xerox highlights current industry themes and challenges, and how manufacturing organizations use document-related concepts and technologies to reduce costs, improve client relationships and increase productivity.

What caught our attention was this link to Enterprise Security – Tightening Your Grip on Trade Secrets, a white paper by David Drab, Xerox's thought leader on security,  He makes some excellent points about managing trade secrets we'd like to share with our readers here.
In today's world, if trade secrets are not nailed down they are more likely to walk out the door and into the hands of a competitor. Plain and simple they are at high risk, and perhaps someone's job is or will be as well. This is the way it works:

A company hires an employee because of her education, knowledge and expertise. The company pays her to invent, to create new ideas that ultimately add value in profitability and corporate growth. She does her job well, then after a half dozen years or so, greener pastures are on the horizon--bigger earning potential, more prestige, career fast-tracking. She markets the idea she was paid to create in pursuit of fame and fortune. She accepts the offer she can't refuse from a competitor and before too long the idea becomes a new product launch. Her former company files a theft of trade secrets lawsuit and ownership litigation ensues.

Many variations of this scenario unfold each day in enterprises across the globe providing endless drama. They represent the tip of the iceberg in spectrum of trade secret theft and misappropriation that extends far beneath the surface into high-stakes espionage. Trade secret litigation is a public spectacle. It is very costly and time intensive, not to mention the negative impact on reputation and shareholder confidence that results. Unfortunately, many of these kinds of cases could have been avoided had there been an effective trade secret management system in place that explicitly described company policies, procedures and protocols governing the identification, handling and use of trade secret information. An organization that exhibits a languid posture towards trade secret management subtly diminishes the importance of ownership, use and control. A person with authorized access can more easily rationalize that ownership is discretionary even though signed confidentiality agreements may be in place. The corporate message simply is not clear, it is not concrete and it is not convincing. Without a management system and definitive handling protocols, trade secrets are vulnerable and at high risk.
Many of our clients use a Publication Clearance System as a component of their  companies' Trade Secret Management. The pub clearance is one important part of filtering and identifying potential trade secrets before anyone in the company inadvertently discloses a trade secret to the public. Another key component of an effective innovation protection system is a secure repository for managing and protecting access to critical trade secrets.

What does your company use to protect its valuable trade secrets? If you're not sure, or wonder if adequate systems are securing your innovations, you may want to contact us for a complimentary review of how your trade secrets are safeguarded. You might also call David Drab at Xerox, who clearly understands the problems and solutions for trade secret management. Heck, with so much at stake for your company, you should probably give us both a call to see how we can help.

Protecting Trade Secrets From The Inside Job

Nolo.com outlines what every business owner should know about trade secret law.

What is a trade secret?

What types of information can trade secrets protect?

What rights does the owner of a trade secret have?

How can a business protect its trade secrets?

How can a business enforce its rights if someone steals or improperly discloses confidential information?

Is stealing trade secrets a crime?

The most notorious recent case of a conviction for stealing trade secrets involved a former employee of DuPont, who is now serving an eighteen month sentence after pleading guilty to downloading thousands of documents from the company's databases when he was about to leave the company--with trade secrets worth an estimated $400 Million to the company.

Almost every few days now, it seems, we read news of some former executive of a company, or scientist working in research and development, being accused of stealing trade secrets.

Just last week, it was reported that a senior research and development associate at a Lubrizol research facility in Brecksville, pocketed at least $170,000 in exchange for trade secrets from 2001 to 2007, according to the information filed in criminal court. Apparently, Lubrizol employs a variety of protective measures to prevent trade leaks, including confidentiality agreements, according to the company.

In most of these cases, unauthorized access and misappropriation of trade secrets is discovered by forensic investigation only after the suspected theft is discovered. You'd think that big companies with significant assets in trade secrets would use the latest solutions for trade secret management. The objective should be to protect the company's trade secrets from misappropriation in the first place, not just to catch criminals who steal intellectual property left unsecured.

Patent Litigation Cases: Lumenis v. Alma

Lumenis is purportedly Israel's largest medical device company with more than 1,000 employees worldwide. Apparently, some of its former employees are now with another company, Alma Lasers, "in what has become a highly competitive industry and business environment," according to Lumenis CEO Dov Ofer.

In June 2007, Lumenis filed an action against Alma for patent infringement in the US District Court in Chicago, Illinois claiming that Alma infringed seven of Lumenis' patents in the design of the Harmony product. Lumenis initiated the Chicago litigation by filing suit against Alma Lasers on June 28, 2007.

On January 25, 2008, Alma filed counterclaims and, among other things, asked the Court to declare six of the seven Lumenis patents unenforceable due to inequitable conduct in procuring those patents. Alma alleged that, when applying for those six patents, the applicants breached their duty of candor, good faith and honesty to the PTO and engaged in inequitable conduct by making false representations to the PTO and by failing to disclose material prior art to the PTO. Lumenis denied the allegations.

Meanwhile,
in December 2007, Alma submitted 22 prior art references to the PTO for consideration with respect to the seven Lumenis patents. Subsequently, the PTO found a "substantial new question of patentability" with respect to each of the seven patents, and commenced reexamination of them. With respect to one of those patents, the PTO, on February 8, 2008, issued an Office Action rejecting 26 claims of the patent as obvious or anticipated by the prior art. On February 21, 2008, the District Court ordered the litigation stayed pending the PTO's reexamination.

In a press release issued on March 26, 2008, Alma seemed pleased to report that: (1) the U.S. Patent and Trademark Office in Alexandria VA ("PTO") has decided to reexamine all seven of Lumenis's patents that are at issue in the litigation, and (2) the Court has stayed the litigation, pending reexamination of the patents.

Also on March 26, 2008, Lumenis issued its own press release announcing that the company had that very day filed a complaint in the Tel Aviv District Court in Israel against Alma Lasers Ltd. and its four founders, Ziv Karni, Yoav Avni, Nadav Bayer, and Ivgeni Kodritzki, all former employees of Lumenis, claiming misappropriation of Lumenis trade secrets and technology and for the use of such technology in Alma's primary Harmony products, which are sold worldwide. Lumenis has requested relief from the court in the form of an injunction against the use of such core technology by Alma in its products and for monetary damages in the amount of 200 million shekels based on the profits earned by Alma and its founders from the utilization of such Lumenis technology. Lumenis will also be filing a similar action against Alma Inc., the US subsidiary and distribution arm of Alma, in the Federal Court in the US.

This new action alleges that Alma went even further than mere patent infringement -- it alleges outright misappropriation of Lumenis technology that was developed by Lumenis over a long period of time and at Lumenis' great expense.

All of the above is reported verbatim from the press releases issued by the companies separately on March 26, 2008, which we've just pieced together to make some sense of the litigation of which both sides appear to be telling their part of the whole story. Anyway, both companies seem to want to get the news out, and we're happy to write about it here.

We're always looking for interesting patent disputes that turn on evidence of prior art and allegations of misappropriation of trade secrets. We'll keep you posted on this one. If either of the parties want to dispute the facts stated in their respective press releases, by all means feel free to have it out in the comments below. We're pleased to provide a forum for discussion of the patents on the merits.