"Patents" and "Trade-secrets" are used by companies and organizations to protect their inventions and discoveries from being copied unlawfully. Most of the companies often face a choice between these two IP protections. Each has advantages over the other and both should be considered meticulously while going for the appropriate intellectual property strategy.
A "Patent" is a right granted to inventors by the government of a concerned country to provide exclusive rights to make, use, import, sell and offer for sale inventions for up to 20 years. This right equips owner companies to make profit from an invention or inventions in exchange for disclosing its invention and the process of the invention. For example, many Pharmaceutical companies patent their molecules and the process of developing the molecule which gives them an exclusive right to manufacture that molecule for at least 20 years. No other company or companies can manufacture or sale this product without the prior approval of the patent holder company. However after 20 years this invention becomes public and any competitor (Individual or Company) can use the same invention and product to make profit out of that.
On the other hand "Trade-secrets" are information (e.g. a recipe, pattern or formula) that provides value to its owner because no other company or individual has the ability and authority to duplicate it even after 20 years also, as the information is never made public by the government. Companies can make profit out of that product as long as they can keep the invention secret and confidential. For example many soda manufacturing companies have never disclosed the ingredients in its soda. In doing this companies ensure that no competitor can ever make the same product.
"Patents" and "Trade-secrets" are interchangeable; means "Trade-Secrets" can become "Patent" at any point of time if the Trade- Secret holder wish to do so. This can be done after filling the appropriate patent application with the concerned government. However the reverse is not possible means a "Patent" cannot be converted into "Trade-Secret" because the invention is already in the public domain.
As told in the previous part of the article that most of the companies often face a choice between these two forms of IP protections. Each has advantages over the other and both should be considered meticulously while going for the appropriate intellectual property strategy. Here is a list which compares between these two forms of IP protections.
• A Patent is generally recognized as the strongest form of IP protection, because the Patent protects the procedure and method of the invention regardless of how it looks.
• A patent can be enjoyed by the patent holder up to a period of 20 years after which it becomes public and any competitor can use it for economical benefit, on the other hand a Trade-Secret holder can enjoy its exclusivity even after 20 years and as long as they can keep the invention secret and confidential.
• One of the most beneficial aspects of Patent is that even if any competitor company develops a product independently and coincidentally which includes the patented concept, the patent holder can infringe the patent of the new company, while such kinds of advantages cannot be availed for Trade-Secrets.
• Patents are not at a risk of becoming public (at least for 20 years) while Trade-Secrets are always at a risk of becoming public. Accidental disclosures, departing employees, and even mandatory disclosures (such as a list of ingredients on food packaging) can all disclose the trade-Secret publically.
• A trade-secret proves to be most effective when the secret cannot be reverse-engineered.
Sum-up: As a conclusion we can say that Patents and trade-secrets both have their own advantages and disadvantages, depending on the type of the patent, and other available criteria. Companies need to do a meticulous analysis of both the forms of IP forms Patent and Trade-secrets and should choose what fits most to them.
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