What is Intellectual Property?
- Do you have a small business or are you a sole proprietor?
- Do you have business secrets you’d rather not have your competitors know about?
- Do you give access to your computers and/or business information to employees? Contractors? Family members?
- Do you share ideas about new products, books, stories, television with friends?
If you answered “yes” to any of the above, then you might want to read the rest of this blog post.
Intellectual Property Protection – Trade Secrets.
Many small business entrepreneurs don’t give much thought to protecting their trade secrets and other intellectual property. Maybe it is because they are so small that they think they have anything to protect. Perhaps it’s because they are just so trusting of others and cannot imagine anyone would steal from them. Or maybe it’s because they think intellectual property protection is not affordable. Whatever the reason, many small business entrepreneurs don’t value their work enough to protect it. Yet, one of the most prized assets you can ever own is your intellectual property—regardless of the form it takes.
Intellectual property, sometimes called IP, consists of a bundle of 5 rights, which include copyrights, trademarks, patents, trade secrets, and rights of publicity. Each piece of your IP portfolio has an appreciated value when it’s monetized. This post will focus on trade secrets, an often overlooked IP right.
Trade Secrets Defined.
A trade secret is information held by one person, company, or organization, which gives them an economic advantage over their competitors. A famous example is the formula for Coca-Cola. Only people with a need to know, in fact, know what that coveted formula is.
Trade Secrets Protection.
Even though trade secrets are a form of IP, they are not protected in the same way as a copyright, a trademark, or even a patent. Trade secret protection comes in the form of strong, well-crafted agreements, which include non-disclosure (NDA) or confidentiality provisions.
Tips for Protection of Trade Secrets:
- Know what you have to protect.
- Update and make current business policies regarding confidential info.
- Act in accordance with your business policies.
- Limit use of company computers & technology for business purposes only.
- Share confidential information with people who have “a need to know”.
- Make sure everyone who has access to confidential info signs an NDA.
- Make sure your NDA is strong and can be enforced. (Internet templates without additional levels of review might not be enforceable)
- Before you terminate a relationship with someone who has access to your confidential info, have them sign a termination agreement with necessary representations ensuring they don’t walk away with confidential data