Page 9 - Grapevine May-June 2019

In The Winery

opposed to the hundreds of other wineries in Napa pany chooses to protect how the product works
Valley. through patent or trade secret. If the innovative
Trade Secrets Protect Valuable feature relates to a cellular telephone device, pat-
Confidential Business Information ent protection is probably the best course, because
by the time the patent expires and a competitor
Unlike other forms of intellectual property, there could use the technology, it will likely be obsolete.
is no registration system for trade secrets, because, Conversely, a novel process in fermenting wine may
by their very nature, they must be protected from have value long after a patent would expire and
all unnecessary disclosure. Trade secrets can be would, therefore, be better suited to trade secret
just about anything that is confidential to your busi- protection. A knowledgeable intellectual property
ness and gives you a competitive advantage. Some attorney, engaged early in the process, can help
examples, include recipes, client lists, manufactur- develop the most effective strategy to protect your
ing processes, marketing plans, and client lists. valuable intangible assets.

One of the most famous trade secrets is the for- Brian Kaider is a principal of KaiderLaw, an intel-
mula for Coca-Cola, which has been kept secret for lectual property law firm with extensive experience
more than 130 years, sometimes through extraor- in the craft beverage industry. He has represent-
dinary measures. In 1977, The Coca Cola Company ed clients from the smallest of start-up breweries
withdrew its product from India, because in order to Fortune 500 corporations in the navigation of
to sell there, they would have had to disclose the regulatory requirements, drafting and negotiating
formula to the government. They decided it was contracts, prosecuting trademark and patent appli-
more prudent to forego sales to one of the biggest cations, and complex commercial litigation.
populations on earth rather than risk disclosure of bkaider@kaiderlaw.com
their secret recipe. (240) 308-8032

Protecting trade secrets requires constant vigi-
lance in two ways. First, the information should
only be disseminated to people within the com-
pany, or outside consultants, who need the infor-
mation in order to perform their duties for the
company. Second, those few people who are given
access, should sign non-disclosure agreements with
harsh penalties for breach of their duty of confiden-
tiality. Once the information gets out, it’s nearly
impossible to un-ring that bell, so there must be
severe financial consequences to someone who
leaks the information.

Conclusion

While patents, copyrights, trademarks, and trade
secrets are four distinct forms of intellectual prop-
erty and serve different functions, sometimes
more than one form of IP can apply to the same
item. The business advantages and disadvantages
of each form of IP should be weighed to determine
the best course of action. For example, a product’s
life-cycle may have a lot to do with whether a com-

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