SYNCHRONIZATION OF PATENT AND TRADE SERCRET: MYTH OR REALITY?

1.INTRODUCTION

A patent is the granting of a property right by a sovereign authority to an inventor. This grant provides the inventor exclusive rights to the patented process, design, or invention for a designated period in exchange for a comprehensive disclosure of the invention. Trade secrets are a type of intellectual property that includes formulas, practices, processes, designs, instruments, patterns, or compilations of information that have inherent economic value. It is known only by the owner or caretaker of the company or firm and if it is leaked outside the company it might cause irrevitable loss to the company. Since both are important to protect the company in this sense both are interlinked with each other because patent can protect inventions, innovations. Trade secrets can do the same thing, but trade secrets can also protect information like data, client lists, software, manufacturing process and essential elements of production etc.

2.EVOLUTION OF PATENT AND TRADE SECRETS

Patents were systematically granted in Venice as of 1450, where they issued a decree by which new and inventive devices had to be communicated to the Republic in order to obtain legal protection against potential infringers. The period of protection was 10 years. The English patent system evolved from its medieval origins into the first modern patent system that recognised intellectual property to stimulate invention. Order to stimulate invention. This was the crucial legal foundation upon which the Industrial Revolution could emerge and flourish. The history of Patent law in India starts from 1911 when the Indian Patents and Designs Act, 1911 was enacted. The Patents Act, 1970 is the legislation that till date governs patents in India. It first came into force in 1972.[1]

Trade secret law has its roots in Roman law was introduced in 1929. In a Columbia Law Review article. Trade secrets law continued to evolve throughout the United States as a hodgepodge of state laws.in 1939, the American Law Institute issued the Restatement of Torts which contained a summary of trade secret laws across states, which served as the primary resource.

3. WHAT CAN BE PATENTED?

• UTILITY PATENT

It is granted to inventions that involve a new and useful process, device, machine, manufactured item, chemical compound or formula. Utility patents, which apply to virtually anothing.

• DESIGN PATENT

It is granted to a new, original ornamental design for a manufactured item. Patents on ornamental designs last 14 years, and they protect only the appearance of the item.

• PLANT PATENT

It is granted to an invented or discovered new plant variety that can be asexually reproduced. Plant patents are granted for a 20-year period.

4. WHAT CONSTITUTE A TRADE SECRET?

• Processes: Anything a company innovates to increase efficiency in manufacturing processes can be a protected trade secret since this process, if not known to competitors or the general public, gives the company a competitive advantage.
• Formulas: Protected trade secret might be a recipe for a food product or an item in the chemistry or health care sector known only to one organization
• Databases: Corporations typically keep detailed customer lists with specific information about buying habits.
• Programs: A proprietary software program that allows for greater information storage or faster information retrieval is another example of a trade secret.
• Business operations: Trade secrets can also be logistical practices or information about marketing, external costs, pricing, and other accounting data.[2]

"THE BIGGEST TRADE SECRET IS THE HONESTY WITH CLIENTS "

5. SIMILARITIES BETWEEN PATENT AND TRADE SERCRET

Patents and trade secrets can be valuable tools for protecting inventions. As a general rule of thumb, if the invention is easily reverse engineered, then patent protection is likely the best option. If the invention is not easily reverse engineered, then trade secret protection may be the better option. It protect the hardwork, ideas, innovations of people or companies. It also motivate a gateway for new invention and research to help mankind and development of the country in terms of technology, research, art, medicines etc. The loss of Patent and trade secret possess a threat to the financial stability and danger to its survival.

6. DIFFERENCES BETWEEN PATENT AND TRADE SECRET

• Patent covers new and useful inventions whereas trade secret contains valuable information of the products such as its making, essential elements and etc.
• Patent protects the invention from being used, manufactured or imported etc. by any other person in future not licensed for it whereas trade secrets protect from misappropriation
• The application for patent has to be made and permission is required by the appropriate authority after its examination by patent office but in case of trade secret no registration or application is required.
• Once the invention is patented it is disclosed to public but in trade secret it remains confidential. The term of Patent is twenty years but for trade secret it is potentially perpetual.[3]

7. CASE LAWS

7.1 Prof. Dr. Claudio de Simone v. Acital Farmaceutica Srl [4]

The Delhi high court held that the information that was treated as a trade secret could not be considered as one, and once the patent has expired all the information comes into the public domain and cannot be further protected based on being a trade secret.

7.2 John Richard Brady and Ors V. Chemical Process Equipments Pvt. Ltd. And Anr[5]

The defendant was not allowed to sell or further manufacture a machine which had been innovated after he had got to know confidential information from another party. It was held that irrespective of whether there is a contract which governs the production or not, any information which had been disclosed cannot be put for unfair use as this against the principles of equity.

8. CASE STUDY OF COCA COLA

Coca-Cola had to make a difficult decision whether to patent their product. On one hand, applying for a patent would place the secret recipe in the public market. This would allow other individuals and businesses to recreate and sell their own cola that tasted exactly like Coca-Cola after the patent expired 20 years later. On the other hand, if Coca-Cola did not patent the secret recipe and it was stolen or misappropriated, Coca-Cola would have no recourse-even if it was stolen within 20 years of when it was first invented. To keep this legendary secret, Coca-Cola has relied on the use of contract law to keep those who know the secret recipe from divulging one of the best-kept secrets in the world.

9. CONCLUSION

Patents and Trade secrets can theoretically coexist. This is because the former can protect patentable inventions while the latter can protect the wealth of crucial ancillary knowledge that goes along with such inventions. As a result, there is a synergistic combination that ensures nearly impervious exclusivity. The same innovation cannot, according to established jurisprudence, be protected by both types of rights. A patent cannot use a know-how agreement to try and protect the information already revealed in the patent, as a trade secret. Patent and trade secret protection cannot be used simultaneously to cover the exact same aspects of the exact same invention. Because patents are published, the public disclosure necessarily destroys the requite secrecy for trade secret protection. This means that, depending on the nature of your the invention or information, the person have to think carefully about which protection is most appropriate at the time for him or her. However, we can use trade secret and patent protection for different aspects of the business or invention to allow for more synergistic or complementary protection.

"THIS IS THE NEW AGE OF PATENT TO KILL BODY TO PROTECT THE SOUL OF INVENTION WITH THE BEST INTENTIONS."

10. CITATIONS

1. AKASH VARADARAJ , The Brief History of Patent System in India available at https://vakilsearch.com/blog/the-brief-history-of-patent-system-in-india/ (last visited on Dec 23, 2023)
2. CITMA, What is a trade secret available at https://www.citma.org.uk/trade-marks-ip/what-is-a-trade-secret.html (last visited on Dec 23,2023)
3. OURYCLARK,Patents vs trade secrets available at https://www.ouryclark.com/resource-library/quick-guides/intellectual-property/patents-vs-trade-secrets.html(last visited on Dec 24, 2023)
4. CS(OS) 576/2019, IA No.15741/2019
5. AIR 1987 Delhi 372

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