Episode 95: Choosing Patent vs. Trade Secret Protection in the Age of AI

Okay, so Tom, at the highest level, what's the difference between patent protection and trade secret protection?

Okay, so they're both types of intellectual property.

Patent protection, You're getting a limited monopoly for a period of time.

You get the right to exclude others from making, using, or selling your invention, but you're also disclosing in a way that people can make real use out of your invention.

So you're putting something in the public domain.

Trade secret is something that derives its benefit from being secret.

You get independent economic value out of it, and you are not, the whole point is that you're not disclosing it the way you would with a patent.

So has AI changed the analysis in terms of the choice of those two kinds of protection? Or is it just the same old, you know, do we choose trade secrets or patents?

I think fundamentally, it's the same analysis.

AI introduces nuance and complexity to the questions you're looking at.

And those questions are inherently factual.

But at bottom, you're looking at, do I want to put this in the public domain through a patent? Or is it something I think can realistically be kept secret?

At a high level, what are the legal sources of patent law versus

trade secret law? So patents come directly from the Constitution.

And then there's the Patent Act 35 USC that sets forth the laws relating to how patents work.

And then you have an... entire administrative superstructure laid over it where you have the patent office Trade secrets originally came from the common law.

You now have the Uniform Trade Secrets Act, which is implemented in every state across the United States except for two.

And even more recently, you have the Defend Trade Secrets Act, the DTSA, which is federal and overlaps to a great extent with what you already have in the UTSA, but with a new federal commerce or foreign commerce component to it.

And DTSA is 10 years old now, but interestingly, the UTSA, which I don't think has been revised or materially revised for over 30 years, there are some changes being contemplated.

And I believe Ken and a co-panelist are gonna address those pending changes in this conference.

So we'll look forward to that.

Okay, so Tom, at the highest level, what's the difference between patent protection and trade secret protection?

Okay, so they're both types of intellectual property.

Patent protection, You're getting a limited monopoly for a period of time.

You get the right to exclude others from making, using, or selling your invention, but you're also disclosing in a way that people can make real use out of your invention.

So you're putting something in the public domain.

Trade secret is something that derives its benefit from being secret.

You get independent economic value out of it, and you are not, the whole point is that you're not disclosing it the way you would with a patent.

So has AI changed the analysis in terms of the choice of those two kinds of protection? Or is it just the same old, you know, do we choose trade secrets or patents?

I think fundamentally, it's the same analysis.

AI introduces nuance and complexity to the questions you're looking at.

And those questions are inherently factual.

But at bottom, you're looking at, do I want to put this in the public domain through a patent? Or is it something I think can realistically be kept secret?

At a high level, what are the legal sources of patent law versus

trade secret law? So patents come directly from the Constitution.

And then there's the Patent Act 35 USC that sets forth the laws relating to how patents work.

And then you have an... entire administrative superstructure laid over it where you have the patent office Trade secrets originally came from the common law.

You now have the Uniform Trade Secrets Act, which is implemented in every state across the United States except for two.

And even more recently, you have the Defend Trade Secrets Act, the DTSA, which is federal and overlaps to a great extent with what you already have in the UTSA, but with a new federal commerce or foreign commerce component to it.

And DTSA is 10 years old now, but interestingly, the UTSA, which I don't think has been revised or materially revised for over 30 years, there are some changes being contemplated.

And I believe Ken and a co-panelist are gonna address those pending changes in this conference.

So we'll look forward to that.