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How can we protect ourselves from our competitor's patent applications ?

Asked over 2 years ago - Lake Forest, CA

Intellectual Property Patent Application

Our competitor's is filing a patent application about a circuit design which is very similar to our existing products. We have been selling our products for 5 years and kept the design as a trade secret. Can we stop them filing the patent ? If not, how can we protect ourselves ?

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Attorney answers (2)

Gerry J. Elman

Reputation Level 11

Answered over 2 years ago. Intellectual Property Law Attorney in Media, PA.

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Gee, that's a question without an easy answer. The first thing I'd suggest you do is locate a patent attorney to whom you confidentially disclose the predicament.

Things to consider with the patent attorney would include whether you wish to communicate with the competitor or just build up your own fences to protect your company from a possible attack if and when the competitor's patent issues.

If you do choose to communicate with the competitor, your patent attorney might send them documentation showing how long your product has been on sale and urging them to tell the patent office about your product as prior art. A patent applicant has a duty to disclose to the U.S. patent office any prior art of which the applicant is aware. It's remotely possible that the competitor might decide that they really hadn't made a patentable invention once they become aware of your information. However, perhaps it's more likely that they would consider their own invention to be an IMPROVEMENT over your product, and they would gladly take your prior art to the patent office and then explain how much of an improvement their invention is.

Moreover, this can be a sensitive balancing act that might wind up divulging your trade secret.

Alternatively you would do well to get out your records and be sure that you've documented and dated your own trade secret in a way that would be admissible in court if push comes to shove. Without endorsing their products or services, I include a link to www.thetso.com, a business that provides tools for enhancing the certainty that one's trade secrets are well documented.

Whatever patent your competitor might get, it could not lawfully cover a product (yours) that was sold earlier than 12 months before they filed their patent application. The expense for you might be to prove that to the satisfaction of a court. On the other hand, if they've come up with an improvement, their valid patent claims might preclude your company from modifying your old product to be closer to their improved version.

Business called "The Trade Secret Office"

Elman Technology Law, P.C.

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Mason Boswell

Reputation Level 8

Answered over 2 years ago. Intellectual Property Law Attorney in Seattle, WA.

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There are two fronts you want to operate on:

1) Invalidate any patents the competitor might file. No one can file a patent application more than one year after the invention has been publicly disclosed and on sale. Patent filers are also under a duty to report prior art they are aware of to the Patent Office. Thus, you want to inform the competitor of your work and that you think it is relevant prior art. You also want to document that you did so (e.g., registered mail, dated letter, and so forth). If they later obtain a patent and failed to inform the Patent Office of your work, their patent could be invalidated.

2) Build your own defensive position. Using trade secret protection for software and hardware is rarely a good idea. Almost any product that is in the hands of customers can be reverse engineered and its methods of operation discovered. Thus, for future improvements of your technology or any past improvements that haven't hit the one-year bar yet, you should be filing your own patent applications. There is nothing worse than defending yourself in a patent fight against a competitor without being able to countersue with patents of your own. Building your own portfolio gives you a better defensive position and documents your contributions to the field (helping establish thought leadership over time).

Finally, if you have been selling your product for 5 years, then you have likely built up market good will and perhaps other forms of competitive advantage like name recognition. Review your other intellectual property assets to make sure, for example, you have properly protected product names using trademark protection. It also doesn't hurt to approach a competitor from a business standpoint to determine if there are areas to work together. Sometimes in an economy like the present, two small organizations working together can be more productive than trying to rip each other apart. Business solutions often produce better outcomes to these problems than legal solutions.

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