According to Lex Machina’s 2018 Trade Secret Litigation Report, the number of trade secret cases pursued in U.S. federal courts has increased rapidly since the 2016 enactment of the Defend Trade Secrets Act (DTSA), which granted federal court subject matter jurisdiction over claims raised under the Act. Last year provided a number of interesting precedential decisions on various topics within the realm of trade secrets law, many of which will no doubt shape litigation tactics (and expectations) going forward. One decision of particular note came from the Federal Circuit Court of Appeals addressed to the issue of whether unjust enrichment claims were entitled to a jury determination. Although the case did not specifically deal with claims raised under the DTSA, it nonetheless could impact who is entitled to determine certain types of monetary remedies requested in trade secret cases.
Every company, but especially startups, looks for a competitive edge to provide an advantage over other companies. Intellectual property (“IP”) rights and the strategy of how to leverage them may separate a startup from other companies.
Because IP can be an essential part of a business and of significant interest to potential investors, startups often enthusiastically disclose their inventions, technology, and other IP when pitching to potential investors or at public events. However, pitching to potential investors or publicly presenting before protecting the IP can have devastating consequences for companies.
We provide below a few of the reasons why companies should consider protecting their IP before disclosing it to the public.
Congratulations! You have developed or launched an innovative new product or service, and your business dreams are becoming a reality. It’s all very exciting. One thing you may not have considered much, however, is whether your innovations or brand are susceptible to infringement in the international context. Will competitors try to make a knock-off product or steal your trade secrets? Are foreign companies going to ship infringing articles to the U.S. market? Protecting your intellectual property (IP) is key. Here are some fundamental suggestions to thwart such threats to your growing business. Continue Reading International IP Issues for Startups
Intellectual property (IP) is a key component of almost every startup’s business. It can distinguish a startup from its competition, attract potential investors, and provide a foundation for future success. Because IP can be such an important part of a company, startups are often eager to disclose their innovations, technology and other IP when pitching their company to investors or when presenting to the public at events such as #TechweekKC. However, a startup’s failure to properly protect its IP prior to making these outside disclosures can have unintended and sometimes devastating effects. Below are just a few reasons why startups should strongly consider their IP protection strategy before revealing their IP to the public.
|June 9, 2017|
|Lung Cancer Without Asbestosis? The Effects of Smoking
By Mark Zellmer
In the medical and scientific literature, a finding of asbestosis is clear evidence that asbestos at least contributed to cause a person’s lung cancer. Many medical experts regard a finding of asbestosis as essential to any finding that asbestos caused any lung cancer. Other experts look for sufficient exposure to cause asbestosis, even if not evident from radiology or pathology. Still others take a position contrary to both views. [Continue Reading]
|Defend Trade Secrets Act: Protecting Product Manufacturers and Sellers’ Confidential Information
By Dan Jaffe
Manufacturers and sellers of products can use the Defend Trade Secrets Act (“DTSA”) to effectively protect their trade secrets. The DTSA was enacted on May 11, 2016, extending the Economic Espionage Act of 1996 (18 U.S.C. §§ 1831, et seq.). DTSA creates a federal civil cause of action for trade secret misappropriation whereby “[a]n owner of a trade secret that is misappropriated may bring a civil action . . . if the trade secret is related to a product or service used in or intended for use in, interstate or foreign commerce.” [Continue Reading]
|Protective Orders in Product Cases
By Alan Hoffman
Discovery in product liability cases often involves inquiry into and disclosure of a firm’s confidential internal product information and documents not available to competitors or the public that it has a legitimate interest in protecting. Plaintiffs frequently serve broad brush stroke discovery in an effort to avoid in missing documents, information and witnesses that might prove relevant to prosecuting their claims. Defense counsel must act quickly and effectively to defend their clients’ valid interests, and seek to limit the scope of discovery as much as possible to avoid costly and burdensome discovery disruptive to their clients’ normal course of business. [Continue Reading]
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|Technology, Manufacturing & Transportation
Product Liability Practice
Manufacturers work hard to develop material goods and product designs that are high-quality, safe and durable. We understand your commitment to excellence and commit ourselves to defending you against product liability allegations. Husch Blackwell’s Product Liability team has insight into your industry-specific challenges. [More information]
|Product Liability Monitor Archive|
Many intellectual property disputes boil down to a few simple questions: who, what, and when?
- Who was there when a new technology was conceived, when was it made into reality and what did each person contribute?
- Exactly what features were present in the new technology when it was patented or licensed? What features were covered by the patent or license?
- What was the exact date a key innovative feature was conceived?
Finding the answers to these questions can be surprisingly tricky, especially if the questions are asked months or years after the events occurred. Being able to find the answers (and being able to produce the documentation that supports those answers) can be critical in determining the outcome of disputes about patents, licenses, trade secrets, and other efforts to commercialize your new technology.
As Techweek kicks off in Chicago this week, it seems appropriate to discuss one of the most important first steps startups should take: securing protection of their intellectual property.
One of the most influential factors that play into the success of a startup is investment. This is often thought of in financial terms, with investors contributing capital to the startup. However, a startup’s investment in protecting its intellectual property is equally as important. There are several reasons why, but this post will focus on one significant point: Capital Investors Care. Continue Reading Protecting Your Investment to Secure Investment: Why Startups Should Protect Their IP Before The Pitch
On May 11, 2016, President Obama signed the Defend Trade Secrets Act of 2016 (DTSA), which amended the Economic Espionage Act of 1996 to create a federal civil remedy for trade secret misappropriation. The DTSA governs misappropriations occurring after the effective date of May 11, 2016.
Although trade secret theft has been a federal crime since 1996, civil claims for trade secret misappropriation were almost always governed by state law. A corporation unable to establish a basis for federal jurisdiction was thus limited to state court. Although every state but two has adopted a variation of the Uniform Trade Secrets Act, these statutory variations and differing court interpretations created uncertainty in the application of trade secret law, an area of growing importance for companies increasingly dependent on electronic security.
In Part 1 of this blog, I discussed the question of data ownership and data protection obligations in precision agriculture. More specifically, I noted that all parties along the field to fork chain should give careful consideration to whether farm data likely will be generated at some point in the process and, if so, who is entitled to own or control the data and what data protection obligations exist as a result. In Part 2, I look at the various types of disputes that can arise if parties fail to reach agreement on key issues before starting work. Once agreement is reached, these points then need to be documented in a well-drafted contract. The range of potential disputes that could break out if good contracting is not employed should convince anyone in business in this area to have well-prepared, thorough written agreements in place to govern precision ag-related business dealings.
A startup’s failure to properly protect its intellectual property (IP) prior to presenting its pitch deck or making other outside disclosures (like at @TechweekKC) can sometimes have unintentionally devastating effects. This is particularly true for IP rights that are not afforded common law protection.
While the experience of pitching to angel investors and venture capitalists can be exhilarating, below are four reasons why startups should take a step back and protect their IP prior to pulling the curtain open.