�ݺ�ߣ

?

?
IP
?For
?Entrepreneurs
?
September
?17,
?2013
?

?
Liz
?Wiley,
?The
?Wiley
?Firm
?PC
?

?

?

?

??? 1836
?
��?? US
?patent
?number
?1
?

??? 1911
?

��?? US
?patent
?number
?1,000,000
?

??? 16
?August
?2011
?

��?? US
?patent
?number
?8,000,000
?
http://www.uspto.gov/news/Millions_of_Patents.jsp
?
?

The
?Harvard
?Business
?Review
?estimates
?$1
?
trillion
?in
?potential
?revenue
?is
?hidden
?and
?
unrealized
?in
?the
?patent
?portfolios
?of
?
companies,
?universities,
?and
?government
?
institutions.
?

?
Investors
?and
?shareholders
?are
?demanding
?
greater
?ROI
?from
?the
?patent
?portfolio
?(mostly
?
for
?struggling
?companies).
?

?

??? Internet
?pioneer
?
?
??? Revenue
?of
?over
?$2
?billion
?per
?year
?
?
��?? Down
?73%
?since
?2006,
?when
?revenues
?were
?$7.8
?

billion
?
?
��?? Earnings
?declined
?from
?$1.4
?billion
?in
?2007
?to
?$13
?
million
?in
?2011
?�C
?with
?two
?years
?of
?losses
?totaling
?
over
?$2
?billion
?in
?between
?

??? After
?its
?deal
?to
?sell
?800
?patents
?to
?Microsoft
?

for
?just
?over
?a
?billion
?dollars,
?AOL
?saw
?its
?
stock
?price
?rise
?by
?62%
?

???

Lost
?market
?force:
?slow
?to
?react
?
?
?

��?? Forced
?into
?bankruptcy
?after
?131
?years
?in
?business
?as
?dominant
?force
?

???

?

1,100
?patents
?it
?deems
?important
?(digital
?imaging),
?(over)valued
?at
?
up
?to
?$2.6
?billion
?
��?? Citigroup
?provided
?Kodak
?with
?almost
?a
?billion
?dollars
?in
??nancing
?

(DIP),
?secured
?by
?all
?of
?Kodak��s
?assets,
?including
?its
?intellectual
?
property
?
?
��?? Selling
?these
?patents
?would
?allow
?Kodak
?to
?pay
?o?
?its
?debts
?and
?gain
?
enough
?operating
?cash
?to
?fund
?new
?businesses
?

?
?

???

A
?failure
?to
?monetize
?the
?patents
?could
?force
?the
?company
?to
?
liquidate,
?putting
?its
?17,000
?employees
?out
?of
?work
?

AGAINST
?
???

?
???

?
???

��Patent
?trolls
?hold
?patents
?and
?

then
?enforce
?them
?when
?they
?
?nd
?evidence
?suggesting
?that
?
the
?patents
?have
?been
?
infringed��even
?though
?the
?
holder
?has
?no
?intention
?of
?
making
?any
?product
?using
?the
?
patent��s
?contents.��
?
?
?
This
?practice
?subverts
?the
?
purpose
?of
?patents
?�C
?and
?
intellectual
?property.
?
Acts
?as
?a
?��tax��
?on
?innovation.
?
?

FOR
?
???
???

???

Patents
?are
?assets
?that
?have
?
inherent
?value
?
Value
?should
?be/can
?be
?
generated
?by
?pursuing
?legal
?
claims
?in
?furtherance
?of
?that
?
value
?
Patents
?are
?like
?any
?other
?
asset
?that
?can
?be
??nancialized
?
(��monetized��)
?and
?assembled
?
into
?a
?portfolio
?

http://wallstcheatsheet.com/trading/these-?�\big-?�\companies-?�\invest-?�\
in-?�\patent-?�\trolls.html/
?
?

Shortly after his return from England in 1849, Howe inspected some of the
new sewing machines that were now on sale and he concluded that they
infringed his 1846 patent.
Regardless of what other features these new sewing machines may have
exhibited, they used��the central elements claimed in Howe��s patent. ��
Since he was destitute, Howe required an investor to finance his patent
infringement lawsuits, and he at last convinced George W. Bliss to invest in
his litigation strategy (as well as purchase a one-half interest in Howe��s
patent from a previous financial backer, George Fisher, who had not realized
any return on his investment).* At this point, Howe was ready to undertake �D
his main preoccupation �� indeed, his main occupation��for the next several
years: namely, suing the infringers of his patent for royalties.
*In exchange for a partial ownership interest in his 1846 patent, Fisher provided Howe with
approximately $2000. �� Fisher thus sold his one-half interest to Bliss for approximately $3500.

Adam
?Mosso?,
?The
?Rise
?and
?Fall
?of
?the
?First
?American
?Patent
?Thicket:
?The
?Sewing
?
Machine
?War
?of
?the
?1850s
?,
?53
?Ariz.
?L.
?Rev.
?165,
?183
?
?(2009)
?(emphasis
?added).
?

Texas
?Trade
?Secret
?Law
?

???

What
?it
?can
?be
?
��?? ��[A]ny
?formula,
?pattern,
?device
?or
?compilation
?of
?

information
?��
?used
?in
?one's
?business
?and
?presents
?an
?
opportunity
?to
?obtain
?an
?advantage
?over
?competitors
?
who
?do
?not
?know
?or
?use
?it��
?

???

Examples
?
��?? Customer
?lists,
?pricing
?information,
?client
?

information,
?customer
?preferences,
?buyer
?contacts,
?
blueprints,
?market
?strategies,
?drawings,
?seismic
?data,
?
in-?�\house
?study
?on
?oil
?and
?gas
?reserves
?

��It
?is
?not
?possible
?to
?state
?precise
?criteria
?for
?
determining
?the
?existence
?of
?a
?trade
?secret.
?The
?
status
?of
?information
?claimed
?as
?a
?trade
?secret
?
must
?be
?ascertained
?through
?a
?comparative
?
evaluation
?of
?all
?the
?relevant
?factors,
?including
?
the
?value,
?secrecy,
?and
?de?niteness
?of
?the
?
information
?as
?well
?as
?the
?nature
?of
?the
?
defendant's
?misconduct.��
?
?

?
?
In
?re
?Bass,
?113
?S.W.3d
?735,
?739
?(Tex.
?2003)
?
(emphasis
?added).
?

��[T]the
?party
?claiming
?a
?trade
?secret
?should
?not
?be
?
required
?to
?satisfy
?all
?six
?factors
?because
?trade
?
secrets
?do
?not
??t
?neatly
?into
?each
?factor
?every
?
time.
?We
?additionally
?recognize
?that
?other
?
circumstances
?could
?also
?be
?relevant
?to
?the
?trade
?
secret
?analysis.
?Thus,
?we
?will
?weigh
?the
?factors
?in
?
the
?context
?of
?the
?surrounding
?circumstances
?to
?
determine
?whether
?geological
?seismic
?data
?qualify
?
as
?trade
?secrets.
?

?
In
?re
?Bass,
?113
?S.W.3d
?735,
?740
?(Tex.
?2003)
?
(emphasis
?added).
?

???
???
???
???
???
???

?

Extent
?to
?which
?the
?information
?is
?known
?outside
?the
?
company��s
?business;
?
?
Extent
?to
?which
?the
?information
?is
?known
?by
?
employees
?and
?others
?involved
?in
?the
?business;
?
Extent
?of
?the
?measures
?taken
?to
?guard
?the
?secrecy
?of
?
the
?information;
?
?
Value
?of
?the
?information
?to
?the
?company
?and
?to
?its
?
competitors;
?
?
Amount
?of
?e?ort
?or
?money
?expended
?developing
?the
?
information;
?
?
Ease
?or
?di?culty
?with
?which
?the
?information
?could
?be
?
properly
?acquired
?or
?duplicated
?by
?others.
?
?

???

E?ective
?September
?1,
?2013
?

???

Broad
?de?nition
?of
?��trade
?secret��:
?a
?formula,
?pattern,
?
compilation,
?program,
?device,
?method,
?technique,
?
process,
??nancial
?data,
?or
?list
?of
?actual
?or
?potential
?
customers
?or
?suppliers,
?that:
?

?

��?? Derives
?independent
?economic
?value,
?actual
?or
?potential,
?

from
?not
?being
?generally
?known
?to,
?and
?not
?being
?readily
?
ascertainable
?by
?proper
?means
?by,
?other
?persons
?who
?can
?
obtain
?economic
?value
?from
?its
?disclosure
?or
?use;
?and
?is
?
the
?subject
?of
?e?orts
?that
?are
?reasonable
?under
?the
?
circumstances
?to
?maintain
?its
?secrecy.
?

??? Injunctive
?relief
?beyond
?life
?of
?trade
?secret
?
??? Damages
?for
?actual
?loss
?caused
?by
?the
?

misappropriation
?or
?unjust
?enrichment
?
??? Royalty
?for
?unauthorized
?disclosure
?or
?use.
?
??? Exemplary
?(punitive)
?damages
?if
?willful
?
??? Attorneys��
?fees
?if
?willful
?
??? Attorneys��
?fees
?available
?to
?defendant
?if
?
claim
?of
?trade
?secret
?misappropriation
?made
?
in
?bad
?faith
?

The Big Business of Patents & The Patent v. The Trade Secret

???

???

Slip
?of
?paper
?in
?a
?vault
?
somewhere
?in
?Atlanta,
?
Georgia
?listing
?17-?�\18
?
ingredients
?
Only
?a
?few
?corporate
?
executives
?know
?the
?exact
?
recipe;
?each
?bound
?by
?oath
?
not
?to
?reveal
?contents
?

��?? When
?one
?of
?these
?individuals
?

dies,
?the
?others
?approve
?a
?
successor
?
?
��?? The
?��keepers
?of
?the
?recipe��
?
travel
?separately
?to
?ensure
?
that
?a
?single
?accident
?won't
?
eliminate
?all
?of
?them
?
?

???

?
?
???

?
???

Harland
?Sanders
?used
?to
?
carry
?around
?the
?secret
?
recipe
?of
?"11
?herbs
?and
?
spices"
?in
?his
?car.
?
Today
?the
?recipe
?lies
?in
?an
?
undisclosed
?vault
?in
?a
?bank
?
in
?Louisville,
?Kentucky.
?
Only
?a
?select
?handful
?of
?
individuals
?know
?the
?exact
?
recipe;
?each
?individual
?is
?
contractually
?obligated
?to
?
secrecy.
?
?

???

?
?

No
?single
?company
?is
?allowed
?to
?
mix
?all
?the
?ingredients.
?

???

The
?herbs
?and
?spices
?are
?mixed
?
by
?two
?di?erent
?companies
?in
?
two
?di?erent
?locations
?and
?then
?
combined
?elsewhere
?in
?a
?third,
?
separate
?location.
?
?

???

To
?mix
?the
??nal
?formula,
?a
?
computer
?processing
?system
?is
?
used
?to
?blend
?the
?mixtures
?
together
?and
?ensure
?that
?no
?one
?
outside
?KFC
?has
?the
?complete
?
recipe.
?

?

??? Litigation
?may
?decide
?whether
?is
?trade
?secret
?
??? Defending
?and
?establishing:
?
��?? Con?dentiality
?agreements
?
��?? Non-?�\competes
?(consult
?an
?employment
?law
?

attorney)
?
��?? Documentation
?of
?limited
?employee
?access
?
��?? Not
?widely
?known
?�C
?but
?ok
?if
?public
?information
?
incorporated
?into
?in-?�\house
?market
?study
?
��?? Proof
?of
?actually
?following
?in-?�\house
?policies
?

?
Liz
?Wiley
?

State
?Bar
?of
?Texas
?
Board
?Certi?ed
?Civil
?Appellate
?Law,
?Texas
?State
?Board
?of
?Legal
?Specialization
?

?

The
?Wiley
?Firm
?PC
?

tel.
?512.560.3480
?|
?fax
?512.551.0028
?
?
skype
?liz.wiley1
?
lizwiley@wiley?rmpc.com
?

?

�ݺ�ߣ

The Big Business of Patents & The Patent v. The Trade Secret

More Related Content

The Big Business of Patents & The Patent v. The Trade Secret