2011 short presentation about trade secrets in univerisities, incl failed federal TS amendment to Economic Espionage Act, and how TS and America Invents act interact.

1. Trade Secrets University Basics Kristine H. Johnson MacMillan Sobanski & Todd, LLC johnson@mstfirm.com &(970) 227-8008

2. Brief Legal History Moral obligations Economic incentives

3. Brief Legal History State laws: “unfair competition” Federal Courts use state law* All: Close relatives of U.T.S.A. *Except for the Economic Espionage Act

4. Brief Legal History Uniform Trade Secret Act The Long Definition of "Trade Secret" The whole or any portion or phase of any scientific or technical information, design, process, procedure, formula, improvement, confidential business or financial information, listing of names, addresses, or telephone numbers, or other information relating to any business or profession which is secret and of value. To be a “trade secret” the owner thereof must have taken measures to prevent the secret from becoming available to persons other than those selected by the owner to have access thereto for limited purposes.

5. Brief Legal History Uniform Trade Secret Act The Short Definition of "Trade Secret" A Secret with Value

6. A Trade Secret is Information held by a pretty good, but not necessarily perfect, fence.

7. A Trade Secret is Information that is often a compilation of known information.

8. A Trade Secret is Information that gives the holder an economic advantage over competitors.

9. A Trade Secret is What the good guys have -- and the bad guys don't.

10. A Trade Secret is not Publicly known, Unfenced, Valueless, Something the bad guys have.

11. Failed Amendment to Economic Espionage Act (18 USC §1832) Proposedby Sen. Coons (D-Del), on October 5, 2011, in S. 1619, in the Currency Exchange Rate Oversight Reform Act: & Kolb (D-Wi) “would protect U.S. businesses from the theft of trade secrets by allowing victimized companies to sue for trade-secret theft in federal court. The legislation would allow for a single, uniform, nationwide cause of action instead of the patchwork of state laws now in place, and would elevate trade-secret intellectual property on the same level as copyright, trademark and patent violations.” & Grassley (R-Iowa), “would help U.S. Customs and Border Protection by amending the Trade Secrets Act to give the Secretary of Homeland Security the legal authority to share basic information — like UPC codes and product samples — with American intellectual property holders to determine if a shipment contains counterfeit or infringing products. Current law strictly limits the information that CBP may share with a right holder pre-seizure.” ! October 11, 2011 voted down due to gross federalism problems !

12. Failed Amendment to Economic Espionage Act (18 USC §1832) Complaint must identify –“reasonable measures taken to protect” secrecy–sworn representation of “substantial need for nationwide service . . . or misappropriation . . . to another country” Ex parte seizure of property or evidence Remedies–injunctive relief against violation or requiring actions to protect secrets; reasonable royalty–actual loss, unjust enrichment; exemplary damages for malicious or willful misappropriation Fees awardable Three-year statute of limitations

13. Trade Secret Fences Legal – no brainer Practical - brainer

14. University Trade Secrets Legal – no brainer Agreements, of course Must parse TS out, and be as specific as possible

15. University Trade Secrets Legal – hot spots All non-public info is not trade secret info “Know-how” is not one-size fits all

16. University Trade Secrets Practical - operation & trade secret specific Notebook security Computer security Lab security

17. University Trade Secrets Universities imply trade secret ownership all the time when they “regulate” scientific publication: publication rights and attribution rights.

18. University Trade Secret Value Stop and think about real trade secrets in any deal Identify specific trade secrets Most likely source: ongoing work that is not patentable Failure is valuable

19. American Invents Act makes Trade Secrets more important Prior use rights – better for TS holder now, if you can prove held as a trade secret for more than one year prior to the patent filing Best mode – demolished, so TS don’t need to be disclosed Derivation proceedings - if a patent applicant derives their invention from petitioner’s TS (eg. a pseudo trade secret misappropriation)

20. Trade Secrets - Respecting Value Brief Legal History Lessons From Food Due Diligence Pointers

21. Lessons from Food The Cheese Biz Doing business on a handshake The Doppler effect Real value Lawyers are never enough

22. Lessons from Food The Cheese Biz Bingham Hill Cheese Some cheese fun Some cheese not-fun

23. Lessons from Food Doing business on a handshake Subcontractors Employees Distributors Da Feds Press

24. Lessons from Food The Doppler effect Plan three times Execute once Clean up three times

25. Lessons from Food Real value Don't assume Let them talk Use all of your senses, including your common one.

26. Lessons from Food Lawyers are never enough Bingham Hill Cheese Company versus Morning Fresh Farm, et al.

27. Trade Secrets - Respecting Value Brief Legal History Lessons From Food Due Diligence Pointers

28. Due Diligence Pointers Talking to everyone Listening (not the same as talking) Looking Around Agreements Lawyers

29. Due Diligence Pointers Talking to everyone Dude, where are you coming from? Speak the language Open-ended questions (Huh?) Re-talking

30. Due Diligence Pointers Listening (not the same as talking) Body Language Culture Not said

31. Due Diligence Pointers Looking Around Postings Inconsistencies Evidence of good guy or bad guy

32. Due Diligence Pointers Lawyers Service providers Sit behind a computer all day Know the law, (hopefully) = hedgehogs

33. Trade Secrets - Respecting Value Brief Legal History Lessons From Food Due Diligence Pointers