MassMEDIC · •Restatement of Torts § 757, comment b “A trade secret may consist of any formula, pattern, device or compilation of information which is used in one

MassMEDIC Massachusetts Medical Device Industry Council

Patent Strategies Panel

General IP Information

May 17, 2012

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Panel Members

• David Crosby

Counsel, Nixon Peabody LLP

• Michelle Flores – Moderator

Counsel, Nixon Peabody LLP

• Maia Harris

Partner, Nixon Peabody LLP

• David Lane

Patent Attorney, DePuy Spine with J&J

• James O’Shaughnessy

Former Vice President & General Counsel, Haemonetics Corporation

***The views and opinions expressed during the presentation and in these slides

are not necessarily those of the attorneys, their employers or their clients.***

Utility Patent Design Patent Trademark/ Trade Dress

Copyright Trade Secret

Subject Matter New, Non-obvious &

Useful process,

machine,

manufacture or

composition of matter

New, original,

ornamental design

for article of

manufacture

Word(s), symbol,

device used to

identify the source of

goods or services

Fixed, original

expression Information that

derives independent

economic value from

not being generally

known

Owner ship Inventor(s) Inventor(s) One who controls the quality of the goods/services associated with the mark

Author(s)

Duration 20 years from filing (unless filing occurred prior to June 8, 1995)

14 years from date of issue

Potentially forever Generally life of the author + 70 years

Potentially forever

Infringement To make, use, sell, offer to sell, or import an item or method covered by a patent claim

To manufacture, use, sell, or offer to sell a colorable imitation

To use a mark/design so as to likely cause confusion among ordinary consumers regarding the source of the goods/services

To copy a work (or portion thereof) in which the copyright is owned by another, where there is substantial similarity of expression

Enforcement Must be owner (or exclusive licensee with right to sue) of issued patent

Must be owner (or exclusive licensee with right to sue) of issued patent

Priority of continuous use of a protectable, distinctive mark Trade Dress must have secondary meaning

Registration of/Application for an original work of authorship (unless a foreign work).

Courts Federal District Courts and/or ITC only

Federal District Courts and/or ITC only

Federal District Courts and potentially ITC; State Courts if not based on Federal rights

Federal District Courts and/or ITC only

State Courts Federal Courts if diversity exists between parties

Types of Intellectual Property

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Trade Secrets

What is a trade secret?

“[A] trade secret is one of the most elusive and difficult concepts in the law to define. In many cases, the existence of a trade secret is not obvious; it requires an ad hoc evaluation of all the surrounding circumstances.”

Kaib’s Roving RPH Agency, Inc. v. Smith, 237 Or.App. 96, 104, 239 P.3d 247, 251 (2010), quoting Learning Curve Toys, Inc. v. PlayWood Toys, Inc., 342 F.3d 714, 723 (7th Cir.2003) (internal quotation marks and citation omitted).

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Trade Secrets - Laws

• Restatement of Torts, § 757 / Common Law

• Uniform Trade Secrets Act (UTSA)

• Restatement of Unfair Competition, 3d

• State Statutes (G.L. c. 93, §§ 42, 42A; G.L. c.

266, § 30)

• Federal: EEA, CFAA, FOIA

• International

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Trade Secrets - Laws •Restatement of Torts § 757, comment b “A trade secret may consist of any formula, pattern, device or

compilation of information which is used in one’s business, and which gives him an opportunity to obtain an advantage over competitors who do not know or use it.”

[Plus six-factor test]

•Uniform Trade Secrets Act § 1(4) “‘Trade secret’means information, including a formula,

pattern, compilation, program device, method, technique, or process, that: (i) 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 (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

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Trade Secrets - Six Factor

Test


• Extent known outside business

• Extent known inside business

• Extent of measures to guard secrecy

• Ease/difficulty to replicate

• Value to company and competitors

• Effort/cost spent to develop

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Trade Secrets -

Massachusetts


“The term ‘trade secret’ . . . means and includes anything tangible or intangible or electronically kept or stored, which constitutes, represents, evidences or records a secret scientific, technical, merchandising, production or management information, design, process, procedure, formula, invention or improvement.”

G.L. c. 266, § 30

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Trade Secrets -

Massachusetts


• “[N]o general and invariable rule can be laid

down” as to what will qualify as a trade secret

or confidential information. Jet Spray Cooler,

Inc. v. Crampton, 361 Mass. 835, 840 (1972).

• Confidential information – a distinction

without a difference.

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Trade Secrets

What is a trade secret – really?!

• Information

• Confidential-plus

– Secret

– Reasonable measures:

“Heroic measures to ensure privacy are not essential, but reasonable precautions must be taken to protect the information.” CVD, Inc. v. Raytheon Co., 769 F.2d 842, 851-52 (1st Cir. 1985)

• Commercial Value

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Trade Secrets

What is NOT a trade

secret?

• General skill and

knowledge

• Information disclosed

publicly

• Industry know-how

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Trade Secrets

1. State it

2. Stamp it

3. Secure it

4. Shred it

5. Sign it

6. Supplement it

7. Substantiate it

How can we protect them?

The Seven S’s of Systemization

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Trade Secrets


• Restrictive Covenants

• Noncompetition Agreement (“Noncompete”)

• Nonsolicitation Agreement

• No-Raid/Anti-Piracy Agreement

• Nondisclosure Agreement

• Invention Assignment

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Trade Secrets


• Other Laws

• Computer Fraud and Abuse Act: intentional

access to a protected computer without

authorization or beyond authorization causing

damage

• Economic Espionage Act:

• Criminal only

• Bill pending to create a private right of action

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Patents

What is a patent?

• A grant of a right to exclude others from making,

using, selling, offering for sale, or importing the

claimed invention for a limited period of time

• Not a right of the owner to make, use or sell

• May be blocked by third party patent

• The right to exclude others lasts for 20 years from the

earliest filing date (or the longer of 20 years from

filing or 17 years from issue if filed or issued before

1995)

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Patents

• Utility Patents

• Machines, processes, compositions of matter

• Design Patents

• Protects an ornamental configuration only

• 14 Year term

• Provisional Applications

• Placeholder for 1 year

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Patents

What is NOT patentable?

• Principles

• Law of nature

• Mental processes

• Ideas

• Natural phenomena

• Mathematical formulae

• Algorithms

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Patents

Requirements to get a patent: • Novelty – patentable if, before filing, the invention was not

• Sold or Offered for Sale

• Described in a Publication Anywhere

• Used or Displayed in Public

• Abandoned, Suppressed or Concealed (first-to-invent vs.

first-to-file)

• We are going to first-to-file as of March 16, 2013 under the

America Invents Act

• Nonobviousness – patentable if

• Sufficiently different from the prior art such that the

invention would not have been obvious to one of ordinary

skill in the art at the time of the invention

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Patents

Patent application requirements: • Enablement

• Must enable one of ordinary skill in the art to

make and use the invention

• Best mode

• Must disclose the preferred mode of practicing

the invention at the time of filing

• Written Description

• Must demonstrate possession of the invention

• Claims

• Must particularly point out and distinctly claim the

invention

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Patents

Patent application requirements: • Specification

• Abstract

• Background

• Summary

• Detailed Description

• Drawings

• Claims

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Patents

Claims:

• Independent

• Stand alone to define the invention

• Contain all the essential elements of a

working invention

• Dependent

• Further defines the invention

• Includes all the limitations of the claims

from which it depends (does not stand

alone)

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Patents

Sample Independent Claim: Claim 1:

An apparatus comprising:

a substantially planar surface with

a first and a second surface;

at least three elongate members, each

having a first end and a second end, the

first ends connected to the first surface of

the planar surface and oriented with

respect to the planar surface such that the

elongate members are substantially

perpendicular to the planar surface and the

elongate members are substantially parallel

to each other.

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Patents

Sample Dependent Claims:

Claim 2:

The apparatus of claim 1 wherein the

substantially planar surface is round.

Claim 3:


elongate members are round.

Claim 4:


elongate members form an angle of 5

degrees with the first surface.

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Patents

Claim Drafting Considerations

• Draft various breadth

• Generally, narrower claims withstand validity challenges more

easily

• Generally, broader claims provide better barriers to entry

• Claiming an apparatus vs. method

• Are you going to enforce the patent claims?

• Who are you going to sue?

• Method of using device may require suing customers or going

after indirect infringement

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Patents

Prosecution in the PTO • Examiner reviews claims, conducts a search and

issues an Office Action

• Communication from the Examiner setting forth

his/her opinion with respect to patentability,

allowing or rejecting claims based on (1)

formalities and/or (2) prior art

• Patentee replies to the Office Actions by arguing

over the rejections and/or amending the claims

• Usually 2 or 3 Office Actions until a “final”

rejection

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Patents

Prosecution in the PTO

• If finally rejected, can either

• Appeal – appeal to the Board of Patent Appeals

and Interferences (new set of eyes) (becomes

the Patent Trial and Appeal Board on 9/16/2012)

• Request for Continued Examination (RCE) –

starts process again

• The public record of all documents filed and/or cited

and this back-and-forth is called the “File History”

or “File Wrapper” or “Prosecution History”

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Patents

Prosecution in the PTO

18 mos. – ~3 yrs.

Publication 18 months from filing of earliest priority date

Term: 20 years from filing of earliest priority date

Notebook Invention Disclosure

Patent Application

Patent Prosecution

Issued Patent

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Patents

Filing Continuations • Continuations, Continuations-In-Part and Divisional

Applications may be filed at any time, so long as

that Application satisfies the three “Cs”:

• Common subject matter

• Co-pending application

• Co-inventorship

• Benefit of the earlier priority date for claims

supported by earlier filing

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Patents

After Issue Proceedings • Post Grant Review – initiated by anyone other than patent

owner within 9 months of issue, and assert any grounds of

invalidity. All parties participate, but has estoppel effect on

requestor. Available for applications filed on or after

3/16/2013.

• Inter Partes Reexam – initiated by anyone other than patent

owner at anytime, and assert invalidity based on publications.

No longer available after 9/16/2012. Replaced by Inter Partes

Review requested by third party 9 months after issue.

• Ex Parte Reexam – initiated by anyone at any time, and assert

invalidity based on publications only. Once filed, requester is

no longer involved.

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Patents

After Issue Proceedings

• Supplemental Examination – initiated by patentee to

help insulate from inequitable conduct claims.

Patentee may submit any art or other information to

the PTO for consideration.

• Derivation Proceedings (after publication or

issuance) – initiated by anyone to show that claim(s)

were derived from another inventor. This is a PTO

proceeding if within one year of the publication, or a

district court proceeding if within one year of

issuance.

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Patents

Foreign Filings

12 Months (Paris Convention)

China

JP EP

All foreign filings “relate” back to priority application

Canada

Australia

Mexico

Latin America

Priority Filing (US)

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Patents

Filing Strategy and Enforcement

• Patents are territorial – can only be enforced in

country from which the patent was issued

• Foreign filing strategy may be based on

• Largest sales by either patentee or competitor

• Easiest to get allowed claims

• Patentee’s presence (headquarters, mfg.,

research)

• Major competitors’ presence

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Patents

Filing Strategy and Enforcement • Patents are a “business tool” – patent owners

usually want to translate the patent into real $ by

• Raise venture capital money

• Sale of patent/business

• Licensing

• Litigation (damages and injunction)

• Create value for the business

• Create barriers to entry (protect sales)

• Protect investment of R&D money

• Prevent or settle lawsuits (counterclaims)

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Steps to Limit Litigation

1. Foster a healthy culture

• Build trusted relationships with your clients

• Partner with business to find practical solutions to

IP issues

• Educate customers about IP issues

2. Build your IP portfolio

• Protects your client’s innovations and can, over

time, reduce litigation threat

• Purchase/license key third party IP

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3. Regularly Conduct IP Clearance Studies

• Plug into appropriate points in the product development process

4. Establish a Patent Marking Program

• Ensure the patents to be marked cover the products

• Only mark with patents that cover the product

• Create a system to track patents as they expire and/or are abandoned

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5. Establish a Program for Handling Confidential Information

• Educate, educate, educate • Risks associated with disclosing company confidential

information • Risks associated with receiving third party confidential

information • Get employees in habit of marking information

appropriately • Limits of NDAs (often no IP ownership provisions)

• Establish process for approving NDAs • Avoid unnecessary or overly broad NDAs • Legal counseling on the front-end; Business “gate-keeper”

on the back end • Partner with your IT Security group

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6. Look at Patent Aggregation Companies

• May reduce exposure to Non-Practicing Entities

(NPEs)

7. Get involved in Contract Negotiations

• Ensure good IP indemnification provisions

• Ensure acceptable IP ownership provisions

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8. Conduct an IP Audit

• Patents, trade secrets, trademarks, copyrighted

materials – ensure that your protected where

you need to be

• Make sure IP policies are consistent with your

practice

9. Affirmatively educate on company policies to

protect IP and respect the IP of others

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Contact Information

David Crosby – [email protected]

Michelle Flores – [email protected]

Maia Harris – [email protected]

David Lane – [email protected]

James O’Shaughnessy – [email protected]

Documents

MassMEDIC · •Restatement of Torts § 757, comment b “A trade secret may consist of any formula, pattern, device or compilation of information which is used in one