Patents, Trade Secrets and Unfair Competition Conference on Intellectual Property in the Global Marketplace Patents, Trade Secrets and Unfair Competition Charles R. Eloshway Patent Attorney Office of International Relations U.S. Patent and Trademark Office

Basis for Protection Constitutional basis in Article I, Section 8. “Congress shall have the power ... to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.” First patent law was enacted in 1790 The present law is codified in Title 35 of the United States Code

What is a U.S. Patent? A form of personal property granted by the U.S. government giving the owner the right to exclude others from making, using, selling, offering for sale or importing the claimed invention for a period of 20 years from the application filing date

What is a U.S. Patent? Quid pro quo—in exchange for 20 years of exclusive rights, the inventor must explain how to make and use the invention in sufficient detail IMPORTANT!—A U.S. Patent provides protection only in the United States IMPORTANT!—The patent owner enforces the patent, not the U.S. government

Stimulating Innovation and Economic Growth by Protecting Investment Patents and the U.S. Economy Research & Development + Industry & Business Patent Applications Stimulating Innovation and Economic Growth by Protecting Investment “These industrial property instruments are used to stimulate further innovation and protect investment.” USPTO Quality Patents

Text equivalent for Slide 5 Research & Development PLUS Industry & Business RESULT in Patent Applications that are submitted to USPTO USPTO puts out Quality Patents RESULT: Stimulating Innovation and Economic Growth by Protecting Investment

Types of U.S. Patents Utility patent Plant patent Design patent Protects articles of manufacture, compositions of matter, machines, or processes, or improvements Term: 20 years from the application filing date Plant patent Protects most asexually reproduced plants Design patent Protects new, original and ornamental designs Term: 14 years from the date of grant

Types of U.S. Patent Applications Provisional utility application Not available for design patents Non-provisional application Most commonly filed application Patent Cooperation Treaty (PCT) application International filing mechanism Hague Agreement on Industrial Designs Application International mechanism for protecting industrial designs (the U.S. is in the process of ratifying and implementing this treaty)

Provisional Patent Application A low-cost way to establish an earlier effective filing date for a later-filed non-provisional patent application with fewer formalities Does not mature into a patent Does not require: An oath/declaration A claim An information disclosure statement (prior art)

Provisional Patent Application May be filed in a language other than English Must file a corresponding utility patent application within 12 months in order to receive the benefit of the filing date of the provisional application

Non-Provisional Utility Patent Application The “typical” type of application Requirements: Specification (description) At least one claim Drawings (when necessary) Oath or declaration Appropriate fee(s)

Non-Provisional Utility Patent Application Requirements: May be filed in a language other than English, but an English translation, a statement that the translation is accurate and a processing fee will be required Nucleotide and/or amino acid sequence listing (when necessary)

Plant Patent A form of personal property granted by the U.S. government giving the owner the right to exclude others from asexually reproducing, selling or using the claimed plant for a period of 20 years from the application filing date.

Design Patent A form of personal property granted by the U.S. government giving the owner the right to exclude others from making, using, offering for sale, importing or selling the claimed invention for a period of 14 years from the grant date

Other Types of Patents Some countries offer another type of patent that provides shorter terms of protection for disclosure of minor improvements of an article of manufacture Utility models Petty patents The U.S. does not offer this type of patent protection

Protection Outside the U.S. An invention can be protected outside the U.S. by: Filing individual patent applications in each country where protection is desired, based upon Paris Convention priority Must file within 12-months of filing the U.S. application Filing a PCT application Currently 126 countries are members of the PCT. Designation in each of these countries is automatic, unless expressly withdrawn More specifics on PCT will be discussed later

Overview of USPTO Patents Operations

UPR Applications Filed FY04 – Preliminary Data

UPR Patents Issued FY04 – Preliminary Data

UPR Applications Filed: Foreign vs. U.S. – FY 04 (preliminary) Technology Center Total Filings US JPO EPC Other 1600 - Biotechnology and Organic Chemistry 37,699 59.5% 8.0% 22.7% 9.8% 1700 - Chemical and Materials Engineering 49,021 49.6% 21.3% 18.0% 11.1% 2100 - Computer Architecture Software and Information Security 34,353 66.4% 12.4% 10.3% 10.9% 2600 - Communications 47,546 47.7% 24.0% 17.2% 2800 - Semiconductor, Electrical, Optical Systems & Components 81,012 43.3% 27.1% 11.3% 18.3% 3600 - Transportation, Construction, Electronic Commerce, Agriculture, National Security and License & Review 47,626 62.4% 11.7% 14.5% 11.4% 3700 - Mechanical Engineering, Manufacturing, and Products 56,084 63.5% 14.1% UPR Total (Preliminary Data) 353,342 54.5% 17.7% 14.2% 13.6%

Design Applications Filed FY04 – Preliminary Data

Average Total Pendency FY 04 Patent Pendency Average 1st Action Pendency (months) Average Total Pendency (months) Technology Center 1600 - Biotechnology and Organic Chemistry 19.2 29.9 1700 - Chemical and Materials Engineering 17.9 27.6 2100 - Computer Architecture Software and 33.3 41.1 Information Security 2600 - Communications 31.4 40.5 2800 - Semiconductor, Electrical, Optical 14.0 23.9 Systems & Components 3600 - Transportation, Construction, Electronic Commerce, Agriculture, National Security and 15.6 24.1 License & Review 3700 - Mechanical Engineering, Manufacturing, 15.2 24.1 and Products Corps 20.2 27.6

Patent Examining Corps Organization and Size Seven Technology Centers (TCs) Biotechnology, Organic Chemistry (TC 1600) Chemical and Materials Engineering (TC 1700) Computer Architecture, Software, & Electronic Commerce (TC2100) Communications (TC 2600) Semiconductors, Electrical & Optical Systems & Components (TC 2800) Transportation, Construction, Agriculture and National Security (TC 3600) Mechanical Engineering, Manufacturing and Products, & Designs (TC 3700 and TC2900)

Patent Examining Corps Organization and Size Every technology center is divided into Art Units (AU) An AU examines specific subject matter within a subject area Every AU has one Supervisory Patent Examiner (SPE) AUs vary in number of examiners Currently around 4000 patent examiners

(Office of Patent Publication) Examination Processing The Patent Process Pre-Examination Processing (Office of Initial Patent Examination) Post-Examination Processing (Office of Patent Publication) Examination Processing Examining Group Application Assigned to Examiner Examiners First Action Patent Publication Division Receipt & review of allowed case & papers Serial No. Assigned Fees Recorded Quality Review Applicant Response Initial Data Capture Initial Preparation and Electronic Capture for Printing and Issue Tentative Classification, Screened for Security Sensitive Contents Second Examiner Action Final Rejection or Allowance File Maintenance Facility Match Post-Allowance Papers and Fees PICS Electronic Scanning Applicant Response Licensing & Review Security Sensitive Cases Separately Processed Final Data Capture Final Preparation and Electronic Capture for Printing and Issue Subsequent Examiner Action Administrative Examination, Data Entry, Filing Receipt Mailed Applicant Response Examiner Patent Printed and Issued Courts Board of Patent Appeals and Interferences LEGEND Normal Processing Sequence Alternate Processing Sequence Abandonments Examiner

Text Equivalent for Slide 25 1 Pre-Examination Processing (Office of Initial Patent Examination) 1.1 Serial Number assigned 1.2 Fees Recorded 1.3 Tentative Classification, Screened for Security-Sensitive Contents 1.4 PICS (Patent Image Capture System) Electronic Scanning 1.5 Licensing & Review – Security-sensitive Cases Separately Processed 1.6 Administrative Examination, Data Entry, Filing Receipt Mailed >> GO TO 2.1 2 Examination Processing 2.1 Examining Group - Application Assigned to Examiner 2.2 Examiners First Action >> GO TO 2.9 OR >> GO TO 2.10 2.3 Applicant Response 2.4 Second Examiner Action - Final Rejection or Allowance >> GO TO 2.9 OR >> GO TO 2.10 2.5 Applicant Response 2.6 Subsequent Examiner Action >> GO TO 2.9 OR >> GO TO 2.10 2.7 Applicant Response 2.8 Board of Patent Appeals and Interferences 2.8.1 Examiner >> GO TO 2.9 2.8.2 Examiner >> GO TO 2.10 2.8.3 Courts << END USPTO PROCESS 2.9 Abandonments << END USPTO PROCESS 2.10 Quality Review >> GO TO 3.1

Text Equivalent for Slide 25 (continued) 3 Post-Examination Processing (Office of Patent Publication) 3.1 Patent Publication Division – Receipt & Review of Allowed Case and Papers 3.2 Initial Data Capture – Initial Preparation and Electronic Capture for Printing and Issue 3.3 File Maintenance Facility – Match Post-Allowance Papers and Fees 3.4 Final Data Capture – Final Preparation and Electronic Capture for Printing and Issue 3.5 Patent Printed and Issues << END USPTO PROCESS

Patent Examination

Examination—The Basics Generally, the examination process is a study by the patent examiner to determine whether the invention described and claimed in the application satisfies the U.S. legal requirements for the grant of a patent Requirements are set forth in: Title 35 of the United States Code Title 37 of the Code of Federal Regulations Guidance is provided in the Manual of Patent Examining Procedure (MPEP)

Basics of U.S. Patent Law

Primary Patentability Considerations 35 U.S.C. §101: Patentable subject matter and utility 35 U.S.C. §102: Novelty and Loss of Right 35 U.S.C. §103: Non-obviousness 35 U.S.C. §112, first paragraph: Sufficient disclosure

35 U.S.C. § 101 – Patentable Subject Matter Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefore, subject to the conditions and requirements of this title. Patentable subject matter is a “process, machine, manufacture or composition of matter” or any “improvement thereof” Very broad No explicit exclusions

35 U.S.C. § 101 - Utility Invention must have a practical application--“Useful, concrete and tangible” result Specific utility Specific to the claimed invention Credible utility Is specific utility credible? Substantial utility Utility that has real-world value

35 U.S.C. §102 – Novelty and Loss of Right A person shall be entitled to a patent unless: (a) The invention was known or used by others in this country, or patented or described in a printed publication in this or a foreign country, before the invention thereof by the applicant for patent; or (b) The invention was patented or described in a printed publication in this or a foreign country or in public use or on sale in this country, more than one year prior to the date of the application for patent in the United States; or – continued –

35 U.S.C. §102 – Novelty and Loss of Right A person shall be entitled to a patent unless: (e) The invention was described in a patent granted on an application for patent by another filed in the United States before the invention thereof by the applicant for patent, or on an international application by another who has fulfilled the requirements of paragraphs (1), (2) and (4) of section 371(c) of this title before the invention thereof by applicant for patent.

35 U.S.C. §102 - Novelty Section 102(a) defines novelty From “first to invent” perspective Note that certain foreign activities are not included Section 102(b) establishes a 12-month “grace period” Beneficial to inventors IMPORTANT!—no grace period in Europe Section 102(e) prevents patents from issuing to different entities for the same invention

35 U.S.C. §103 – Non-obviousness A patent may not be obtained though the invention is not identically disclosed or described as set forth in section 102 of this title, if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains. Patentability shall not be negatived by the manner in which the invention was made.

Graham v. Deere Determine the scope and contents of the prior art. Ascertain the differences between the prior art and the claims at issue. Resolve the level of ordinary skill in the pertinent art. Consider objective evidence present in the application indicating obviousness or non-obviousness.

35 USC §112 – Sufficient Disclosure The specification shall contain a written description of the invention, and the manner and process of making and using it, in such full, clear, concise and exact terms as to enable any person skilled in the art to which it [the invention] pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor of carrying out his invention.

35 USC §112 – Enablement “The specification shall . . . enable” one skilled in the art to “make and use” the invention Part of the quid pro quo—the inventor must describe the invention in sufficient detail so that those familiar with the technology can build upon the inventor’s contribution

35 U.S.C. § 112 - Enablement “Wands” factors Breadth of claims Nature of the invention State of the prior art Level of skill in the art Level of predictability Amount of direction/guidance Presence/absence of working examples Quantity of experimentation

35 USC §112 - Written Description “The specification shall contain a written description of the invention . . .” Considerable debate among judges and practitioners as to how this requirement should be applied “literal” description? entitlement to filing date? Also part of the quid pro quo—inventor is only entitled to exclusive rights for what he/she invented

35 U.S.C. § 112 – Best Mode “The specification . . . shall set forth the best mode contemplated by the inventor” Also part of the quid pro quo—the inventor cannot keep the best way to make and use the invention for himself/herself Draws a line between a patent and a trade secret (more on trade secrets later)

Where to Go for Help?

USPTO Web site

USPTO Web site

USPTO Web site

PAIR

Trade Secrets

Trade Secret Law: Purpose Generally used to protect proprietary portions of technology Formulae Manufacturing processes Business strategies Business management information Customer lists Design concepts

Trade Secret Law: Background In the U.S. – Law varies from state to state Every state recognizes some form of trade secret protection Most state legislatures have passed a trade secret law, although some states rely solely on common law principles Uniform Trade Secrets Act has helped create a more uniform body of law from state to state

Trade Secret Law Two fundamental concepts: Trade secret must be something that is used in business and which gives the owner a competitive advantage The owner of a trade secret must take reasonable measures to maintain its secrecy

Loss of Trade Secret A single “unprotected” disclosure may result in loss of trade secret Reverse engineering of a product to discover the trade secret

Patents vs. Trade Secret Disclose invention sufficient so others can make and use the invention Duration—20 years from filing Protection against independent discovery Trade secrets Confidentiality Potentially indefinite Protection lost if independent discovery or reverse engineered

Conclusions Patents provide the owner with the right to exclude others from exploiting the invention for a limited period of time Patents are territorial Patents are enforced by the owner Know the patent law requirements where you want to obtain patent protection! Patents and trade secrets are different forms of protection, with different requirements and different benefits—know the differences!

Patents and Trade Secrets Conference on Intellectual Property in the Global Marketplace Patents and Trade Secrets Charles.Eloshway@uspto.gov THANK YOU