Sunday 5 June 2011

Entrepreneurs beware


A recent newsletter from the WIPO SME Unit highlights the “Top Ten Legal Mistakes Made by Entrepreneurs” as identified by Harvard Business School professor Connie Bagley. Three of the top five mistakes relate to IP.

At #5 is “Waiting to consider international intellectual property protection.” In fact, the example given by Prof. Bagley relates to waiting to consider IP protection per se, pointing out that in the US, “if an invention is sold or made public, there's a year's grace period to file a patent application. Everywhere else, if the invention is sold or publicized prior to filing the patent application, the invention is unpatentable in that country.

At #4 is “Disclosing inventions without a non-disclosure agreement.” “Is it wise to get potential venture capitalists to sign a nondisclosure agreement?” she asks, suggesting that “In the best of all worlds, yes, but most won't. Before disclosing to anyone, one must learn who has a reputation for integrity in the industry.

And at #3 comes “Starting a business while employed by a potential competitor, or hiring employees without first checking their agreements with the current employer and their knowledge of trade secrets.

But top of Prof. Bagley's list comes “Thinking any legal problems can be solved later”. “Many of the points made here are problems that can't just be patched up later” she explains.

1 comment:

Japser said...

"Everywhere else, if the invention is sold or publicized prior to filing the patent application, the invention is unpatentable in that country."

Publicised, yes. Sold, I'd say that varies. If sold under NDA to a very small amount of parties, an invention may still be patentable. Not all countries apply in that respect rules w.r.t. confidential sale that are as restricted as in the US where the grace period (also) starts at the first sale.

However, too many sales under NDA may certainly jeapardise patentability in Europe. EPO caselaw states, in particular w.r.t. standard specifications, that if virtually all parties can get access to confidential information by just signing an NDA (and perhaps some other general agreements), that confidential information is comprised by the state of the art (sorry, I do not directly recall the number of the decision).