What's all the fuss about keeping inventions confidential?

Written by: D Young & Co LLP | Published:

Crucial to the success of a patent is that the product or process claimed by the patent is inventive and the invention is not part of the 'prior art'.

This means that the invention must not have been made available to the public before the priority date. For most countries in the world, this is the date on which the patent was originally filed at the applicable patent office. Even if granted, a patent can later be found to be invalid. Indeed, this is a typical counter-argument when patent owners bring infringement proceedings: the alleged infringer claims that the patent isn't valid anyway and does its best to find evidence that the invention was in the public domain before the priority date.There have been a number of court cases in which patent owners have invalidated their own patents because a premature public disclosure was made about the invention.

Accordingly, it is absolutely essential that you do not disclose your invention outside company before you file for the patent. Examples where people have 'slipped up' and potentially invalidated their own patents include:
• releasing marketing materials;
• testing the market before launch, discussing plans with customers or giving them prototypes;
• publishing an article disclosing the invention;
• revealing the invention on television;
• discussing the invention in a pub with friends.

Why is the 'prior art' important?
The benefit of a patent is that it gives the owner an absolute monopoly right: there is no need for the patent owner to prove the alleged infringer even knew about the patent when enforcing it. In return, patent law places strict restrictions on what is patentable. As Mr Justice Laddie said in Pfizer Limited's Patent: "Patents are not granted for the discovery and wider dissemination of public material and what is obvious over it, but only for making new inventions" ([2001] F.S.R. 16).

It is important to remember that different rules apply in different territories. For example, in the US there is a 'grace period' in which an inventor can disclose the invention and then wait up to 12 months to file the application. This is not the case in the UK. Also, for something to be part of the prior art, it need not thave been widely disseminated. In theory, scribbled comments in the margin of a library book could be 'prior art'.

Confidentiality: legal steps
Many of these issues can be avoided by ensuring that everyone who comes into contact with the invention or is involved in discussions about it, is bound by a confidentiality agreement. UK patent law exempts from the 'prior art' any disclosures made that breach confidentiality obligations.

English law does impose confidentiality obligations in various situations even if there is no written contract, although it can be difficult relying on unwritten obligations. For this reason, ensure that confidentiality agreements are clearly set out in writing and that the relevant individuals sign up to whatever practical security measures the business may have in place. These should include:
1. Information: There should be a clear definition of the confidential information to be protected. The disclosing party will want to ensure that this definition is as broad as possible and should include any works derived from the confidential information.
2. Obligation: There should be a clear obligation to keep the information secret and to use it only for certain purposes explained in the agreement.
3. Consideration: in English law, for a contract to be enforceable there must be consideration. This could be a nominal amount (e.g. £1) or something of monetary value such as a customer's feedback on a new prototype. Without clear consideration, the contract may be invalid.
4. Duration: A disclosing party will typically want the duration of the contract to last as long as the information is confidential. The term should usually be for a minimum of five years. If the application is published its contents will cease to be confidential from that date, but if the patent application is withdrawn before publication, a period of five years typically provides scope for the prospective applicant to re-file the application.

Confidentiality: practical steps
In addition to confidentiality agreements, businesses can take practical steps to establish and maintain confidentiality. For example, ensure that information is disseminated on a need-to-know basis and that documents are marked confidential.
Also, restrict physical and electronic access to areas where confidential processes are stored, conducted or developments are being made and give employees practical guidance on keeping information confidential (eg taking precautions when using laptops in public places).

For more information, please contact Carina Badger, Senior Associate, on 020 72698550 or email cxb@dyoung.com.


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