THE INTERFACE BETWEEN TRADE SECRETS AND PATENTS
A company can—and should—use both patents and trade secrets to protect different aspects of the same invention. There is a
common misperception that the two forms of IP are mutually exclusive. But courts have long held that a published patent does
not invalidate those trade secrets that are not disclosed in the patent. The key to leveraging both patents and trade secrets
is to first understand the weaknesses of each form of IP and then to compensate for one with the other.
The historic weakness of a patent is determining whether a competitor is infringing in the first place. Patent enforcement
is especially difficult if the invention relates to a method of manufacture and the end product by itself does not reveal
how the product was made. In a situation like this, where "reverse engineering" is difficult, it is advisable to use trade
secrets to protect the method and use patents to protect the product. To obtain this patent, however, the applicant will still
need to disclose to the public how to make the product, but only to the minimum extent required by law. Three legal requirements—written
description, enablement, and best mode—set the level of detail that a patent applicant must disclose in order to obtain a
valid patent. A patent applicant can comply with these requirements without giving up its trade secrets.
According to the patent appellate court, "The written description requirement does not require the applicant to describe exactly
the subject matter claimed, instead the description must clearly allow persons of ordinary skill in the art to recognize that
the inventor invented what is claimed." Pandrol USA, LP v. Airboss Ry. Prods., 424 F.3d 1161, 1165 (Fed. Cir. 2005) (emphasis
added). Thus, trade secrets can still protect the "know how" surrounding the manufacturing process, so long as persons skilled
in the art understand the scope of the patented product.
Similarly, "enablement" requires that a patent applicant describe how to make and use the invention in such detail as to enable
someone skilled in the art to practice the invention without undue experimentation. The case Hayes Microcomputer Products
is an example of a party withholding its trade secrets from a patent disclosure and still satisfying the enablement requirement.
982 F.2d 1527, 1534 (Fed. Cir. 1992). The opposing party argued that the patent applicant, who merely provided a flowchart
of a software operation, did not describe the claimed "timing means" and thereby kept it as a trade secret. The court relied
on the inventor's own assertion that "if you had experience in doing microprocessor programming, you would know how to implement
what's in that diagram," and the court further noted that "an inventor is not required to describe every detail of his invention"
Finally, the "best mode" requirement in patent law is most conducive to withholding later-arising discoveries as trade secrets.
The patent applicant must disclose the best mode of carrying out the invention, but only at the time the application was filed.
Thus, if a company continues to refine an invention after filing its initial patent application, all subsequent discoveries
may be either held as trade secrets or pursued as additional patents.
In addition to using trade secrets to shore up the weaknesses of patents, an innovative patent strategy can be used as a hedge
against the downside of trade secrets. Trade secrets are susceptible to both inadvertent disclosure and independent invention
(i.e., a competitor later invents, patents, and sues you for practicing the trade secret). As discussed previously, a company
may file provisional applications as placeholder patents. If either of the two adverse events occurs to the trade secret while
the provisional application is sitting at the USPTO, then the provisional can be converted into a regular patent application
in order to preserve the invention.