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Pros and Cons of Trade Secrets versus Patents

Michael Van Loy, a Member in the Intellectual Property Section of the law firm of Mintz Levin, discusses trade secrets versus patents to protect intellectual property. Mike has his bachelors in chemistry and his PhD in environmental engineering from the University of California, Berkley.  He also has his law degree from Santa Clara University.

Mike was named a San Diego Super Lawyers Rising Star for Intellectual Property in 2016.

Let’s listen to his take!

Pros and Cons of Trade Secrets versus Patents

As Mike Van Loy states:

“A trade secret is basically something that has value that is in the public domain. For it to be a company’s trade secret, they have to take some steps to mark it as secret and keep it secret.  Your only real cause of action with a trade secret if someone gets it is if they stole it. If someone buys your product and manages to reverse engineer how you did it, then it’s not a trade secret anymore. If someone else independently comes up with the same idea, then you have no recourse.  All you really have in that trade secret is that you have to basically show that someone stole from you. You tend to see it used when an employee leaves and suddenly this technology has now shown up in the competitor’s product that they went to. You may say, ‘You signed this agreement. You’re obliged not to share it.’  There’s a risk. Again, a trade secret doesn’t expire. A patent expires. There’s that exchange with a patent where I have to file a patent application. I have to effectively describe in sufficient detail what I have to claim. There’s a possibility that I don’t get the patent. In that case, I’ve just shared everything with the world.  In the U.S. you can actually file your patent application with a request not to publish it until it’s issued. You can only do that if you’re staying in the U.S. If you’re filing internationally, then you can’t. It will be published 18 months after the first priority date.”

I hope you found this as useful and insightful as I did!

This is Patrick Henry, CEO of QuestFusion, with The Real Deal…What Matters.