Trade Secret Information can be Purely Mental

Ohio-sealAl Minor & Assoc v. Martin, 2008 Ohio 292 (2008)

One aspect of the upcoming Bilski considers whether “mental methods” can be patentable. There are various types of mental methods — running from the most innocuous situation where a portion of a process could be performed in the human mind to the most questionable situation where an entire process must be performed in the human mind.

Opining on Patent’s legal cousin – trade secret law – the Ohio Supreme Court has held customer lists compiled by former employees strictly from memory can be the basis for a trade secret violation.

“[W]e have concluded that the client information at issue in this case did not lose its status as a trade secret, or the protection of the UTSA, because it had been memorized by a former employee.”

As part of his employment contract with AMA, Martin was not required to sign a noncompete agreement or even an employment contract. When he left AMA, Martin was careful not to take any documents belonging to AMA. However, Martin did remember the names of 15 AMA clients and solicited their business.

In its decision, the Ohio court could not find any legal or policy reason to “distinguish between information that has been reduced to some tangible form and information that has been memorized.” (Noting that the statute makes “no mention of writings or other physical forms that such information might take.”

One real problem is that “employee will of course have memories casually retained from the ordinary course of employment.”  In response to this problem, the court gave the unsatisfactory statement that former employees can use their non trade secret memories. “The [UTSA] does not apply to the use of memorized information that is not a trade secret.”

This decision follows the “modern trend” amongst most states to eliminate any “written-memorized distinction.” See Pooley, Trade Secrets (7th Ed.2001).

40 thoughts on “Trade Secret Information can be Purely Mental

  1. Weary,

    The following two journal articles are representative of some of the issues:

    link to harvardlawreview.org
    link to law.bepress.com

    In my opinion where subject matter specifically excluded under 101 is preserved under state law principles of unfair competition, most notably trade secrets, there is similarly a “tension” should the holder pursue a means of exploitation that is inconsistent with longstanding patent jurisprudence. As the above articles note, it is all too easy to push the limits of trade secret law so as to impact patent law through the use of various licensing provisions, and especially with subject matter such as software.

    The second of the articles is directed specifically to Bonito, and contains many insightful comments that to me are quite thought provoking.

    A final point regarding the relationship between trade secret and patent law as it relates to USSC jurisprudence. Many years ago Justice Learned Hand articulated a simple view that has never gained traction. Generally speaking, if it is not patentable it is not protectible under trade secret law. As so aptly noted by Miller in the first article, a principle today may cease to be a principle tomorrow, and understanding the current principle is helpful in understanding future arguments that may lead to a shift within the Court. My above observations concerning 101 is merely that if our federal system specifically states that certain subject matter, for both practical and public policy reasons, is foreclosed from protection under patent law, then it seems to me this would represent an important factor should a future case before the court contain an evidentiary record that fairly illustrates this point.

  2. Mr. Slonecker,

    You’re going to have to be more specific. I’m sure it’s a lack of imagination on my part, but I can’t think of any such circumstances.

  3. weary lexicographer,

    “Trade secret protection is definitely not patent-like.”

    Under circumstances where relief is sought against one who has acted “improperly”, then perhaps true. However, what about circumstances where the trade secret “owner” (quotes used to avoid the suggestion that trade secrets are property) exploits the trade secret in a manner that for all intents and purposes begins to “eat away” at one or more of the underlying reasons for patent law?

  4. Mr. Slonecker,

    I’m sure that you have a point, but I don’t get it. I believe Mr. Mooney is quite right in this instance.

    Bonito Boats does not say that any subject matter that is ineligible for patent protection may not be protected by a state regulatory scheme. Instead, it said that a state cannot give “patent-like protection” for things that are either unprotectable under patent law or simply not protected.

    Trade secret protection is definitely not patent-like.

    Note that the Court comes very close to directly gainsaying you in Bonito Boats:
    “Even as to design and utilitarian conceptions within the subject matter of the patent laws, the States may place limited regulations on the exploitation of unpatented ideas to prevent consumer confusion as to source or the tortious appropriation of trade secrets.”

    If patent law doesn’t preempt trade secret law with respect to overlapping subject matter, it almost certainly doesn’t preempt trade secret law with respect to subject matter that is unpatentable as a matter of law.

  5. weary lexicographer,

    I believe I use “posit” correctly, but do believe you are correct that I have been “gainsaid” by Mr. Mooney. Of course, I “gainsaid” him right back by noting that while patent and trade secret law can quite peacefully co-exist, it is difficult to see how the two can co-exist in the case of the Bilski method should the CAFC declare that 101 controls and the Bilski method if foreclosed from entering through the “patent door” of Title 35.

  6. “Admissions and characterizations made to the Examiner to get the claims allowed HAVE to be reviewed to properly determine the scope of the claims.”

    In the US, yes, of course. In other countries, the examiner will demand that such admissions/characterizations are amended into the claims. I’m merely proposing that this saves everyone a lot of time/headaches/money.

  7. Stander,

    Claim language is not always clear in retrospect, even in view of the written description. Therefore, the file wrapper can be very helpful.

    Further, back in the day, a lot of attorneys would simply interview their cases and claims would go from being rejected to being allowed in the next action. I want to know that the Examiner simply wasn’t razzle-dazzled by the attorney. Admissions and characterizations made to the Examiner to get the claims allowed HAVE to be reviewed to properly determine the scope of the claims.

  8. “… can it not be gainsaid that … there is significant tension between federal law saying it is not protecable and a state court saying that it is protectible under state law as a trade secret? ”

    Technically, the answer to your question is yes. I suspect you don’t know what “gainsaid” actually means. Your assertion can be gainsaid. And it was gainsaid, i.e., contradicted, by Malcolm.

    For what it’s worth, I also think you’re using the word “posit” incorrectly. It would be a bit odd to posit a question, although you might pose one. If you did, I could posit an answer.

  9. Slonecker, the answer to your question is “no” for the reasons I described upthread. There is no “tension” because the patent and trade secret paradigms are inherently distinct.

  10. Anon E. Mouse,

    The statute in question did not prevent reverse engineering in its totality, but only with respect to “plug molding”. As Judge Rich pointed out it a companion case, this one limitation under state unfair competition principles, merely removed one means of reverse engineering, but left in place all other forms such that reverse engineering was not foreclosed in any meaningful sense. Hence, the question before the Supreme Court was whether or not a state, under general state principles defining unfair methods of competition, was preempted under federal patent law. The Supreme Court came down on the side of federal preemption. Importantly, Bonito for whatever reason did not pursue a utility patent, could not pursue a design patent since the hull features were ulititarian, and that the hull did not qualify for protection under copyright law.

    In Bonito there was no question that the hull design represented a trade secret…clearly it was not under any of my above noted trade secret “regimes”.

    The questions I posited are a bit more subtle in the sense that if the CAFC decision come down squarely in support of the BPAI decison, ie., that patent law forecloses the patenting of Bilski’s method under 101, can it not be gainsaid that because of federal preemption and a declaration that 101 (as interpreted by the courts) represents overriding federal policy demanding uniformity among the several states, there is significant tension between federal law saying it is not protecable and a state court saying that it is protectible under state law as a trade secret?

  11. Too Whom Else It May Concern out there in America’s Patent Land:

    Speaking of bull, did anyone see Boston Legal last night? The Judge in the cloned bull/mad cow market case must have read Patently-O yesterday, or at least the “Trade Secret Information can be Purely Mental” thread, and he took heed:

    Why?, you ask, you who did not see Boston Legal last night, how do you know the bull/mad cow Judge read from the “…Mental” thread? DoubleThink, to wit:

    You may find this hard to believe, but it is true!; true! The bull case Judge first granted victory to the Plaintiff, then in his next breath after objection, to the Defendant!, … then to the Plaintiff, … then the Defendant.

    Yes it is true, the RESULT ORIENTED DECISIONs were granted to BOTH PARTIES = a perfect DoubleThink, point, set and match and match (©¿®).

    Has this ever happened to any of you litigators out there in Patent Land? If so, please serve your Complaint to this guy:
    link to patentlyo.com

  12. To Whom It May Concern out there in America’s Patent Land:

    Not only is it possible that

    “Trade Secret Information can be Purely Mental”

    but according to The Honorable Holmes, Jr., so can a DISAVOWAL OF CLAIM SCOPE BE PURELY MENTAL when describing prior art while prosecuting a patent application!

    It’s true!; please see this discussion if you find it hard to swallow:

    link to patentlyo.com

    And on that same thread,
    Sir or Madman posted another brilliant insight about Purely Mental MindPlay stuff:

    link to patentlyo.com

    And The Honorable Holmes, Jr., posted about 30 more inches of comment if you scroll down and down and down … but you can save your scrolling finger by using the “page down” key repeatedly.

  13. Malcolm,

    I have that problem sometimes too (but not with The Honorable Holmes, Jr.; when he speak everyone listens) and I Just use the page down button so I can save my fingers for other things like picking my banjo or whatnot or for saluting those what deserve such special salutation (©¿õ).

  14. Hey Oliver, when you flood the stage, would you mind keeping it below 8 feet or so? My finger is getting tired from the constant scrolling.

  15. Oliver, this is why most other juristictions do not readily allow interpretation of the claims in view of the file wrapper. It’s too tempting for meddlers to go back and try to figure out what the inventor was or was not thinking based on casual statements or statements by omission in the prosecution history. The inventor’s thoughts on the monopoly should be memorialized by the claims and only the claims, which are drafted with about 100 times more attention than the typical office action reply. File wrapper estoppal or whatever it’s called exists because examiners have been too lazy to demand the applicant limit the claims based on arguments made and attorneys/applicants prefer broad claims and so don’t bother to police themselves.

    Who is to blame? Ultimately, whoever decided it was okay venture outside the four corners of the specification when interpreting the claims.

  16. Can some one shed some insight on the question “WHO IS TO BLAME” I posed in my comment above–
    link to patentlyo.com

    WHAT and WHO caused the grossly onerous PATENT REFORM proposals in Congress, and the similarly grossly onerous PATENT REFORMS attempted by the PTO that were almost successfully rammed down our throats?

    WHO IS TO BLAME?

    Does this Congressional and Executive PTO backed onerous Patent Reform run parallel to the PATENT REFORM AMBITIONS of Big Business coalitions like the “COALITION FOR PATENT FAIRNESS” whose members are largely comprised of the highly successful software new-comers to America’s computer technology field of art and their largest corporate customers who have been Brain-Washed by the “Coalition for Patent Fairness” members? Was such Brain-Washing caused in part by, for example, reading CISCO SYSTEM’s now defunct horseshit “public service” and anonymously run Patent Troll Tracker lobbying blog?

    And why does is the Judicial Branch of our government continue to screw up our patent system with one patent-devaluing opinion after the other: For example, the Supreme Court gave us Festo in 2002, eBay in 2006, KSR in 2007 and most recently the Supremes declined to take the CIAS Certiorari Petition which left the Federal Circuit’s absurd opinion AFFIRMING a district court opinion that tanked a reexamined patent solely because the Judge perceived what was in the mind of an inventors when the inventors described prior art in a Request for Reexamination in the file history.

    This Supreme Court denial created a patently-impossible crisis-level “DoubleThink”:
    When an inventor DOES NOT make a “CLEAR and UNMISTAKABLE” disavowal of claim scope, which is the yardstick for a file history disavowal, the Judge can simply perceive what is in the inventor’s mind to find a “DISAVOWAL” by “IMPLICATION,” which is a CONTRADICTORY yardstick by which to find a DISAVOWAL OF CLAIM SCOPE. This DOUBLETHINK is potentially devastating to patentees any time a Judge feels like tanking a patent for political reasons or for personal bias reasons — a blank check for writing RESULT ORIENTED OPINIONS.

    WHO IS TO BLAME?
    Who is to blame for Congress, the Executive PTO and the Judicial Branches of our government pushing grossly onerous PATENT REFORM horseshit on the IP community?

  17. >>”is there some dictionary I can use to understand e#6k?”

    Be careful what you wish for, as it would probably only make you angry. Consider it a blessing in disguise.

  18. is there some dictionary I can use to understand e#6k? I thought his abbreviations were to save letters, but then I see something like “moar”, which I don’t think saves any letters. And “orly”? Why does a town in France get so much texting love?

    I for one agree, hire double the examination staff. This won’t solve the problem of quality examination if you don’t reduce the attrition, but it will solve the problem of having a backlog.

  19. M. Slonecker:

    Remember, the statute in question in Bonito outlawed reverse engineering — it “competed” with patent statutes in giving that sort of protection.

    From Bonito Boats:
    ————–
    Thus, in Kewanee Oil Co. v. Bicron Corp., 416 U. S. 470 (1974), we held that state protection of trade secrets did not operate to frustrate the achievement of the congressional objectives served by the patent laws.Despite the fact that state law protection was available for ideas which clearly fell within the subject matter of patent, the Court concluded that the nature and degree of state protection did not conflict with the federal policies of encouragement of patentable invention and the prompt disclosure of such innovations.

    Several factors were critical to this conclusion. First, because the public awareness of a trade secret is, by definition, limited, the Court noted that

    “the policy that matter once in the public domain must remain in the public domain is not incompatible with the existence of trade secret protection.”

    Id. at 416 U. S. 484. Second, the Kewanee Court emphasized that “[t]rade secret law provides far weaker protection in many respects than the patent law.” Id. at 416 U. S. 489-490. This point was central to the Court’s conclusion that trade secret protection did not conflict with either the encouragement or disclosure policies of the federal patent law. The public at large remained free to discover and exploit the trade secret through reverse engineering of products in the public domain or by independent creation. Id. at 416 U. S. 490. Thus, the possibility that trade secret protection would divert inventors from the creative effort necessary to satisfy the rigorous demands of patent protection was remote indeed. Ibid. Finally, certain aspects of trade secret law operated to protect noneconomic interests outside the sphere of congressional concern in the patent laws. As the Court noted, “[a] most fundamental human right, that of privacy, is threatened when industrial espionage is condoned or is made profitable.” Id. at 416 U. S. 487 (footnote omitted). There was no indication that Congress had considered this interest in the balance struck by the patent laws, or that state protection for it would interfere with the policies behind the patent system.
    ————————-

  20. E#6k cat iz in ur blog, ranting. Please lay off with the ranting. I agree with some but not all of your points, but sometimes they get lost. I am pretty sure you are in your twenties from your lolspeak.

  21. JV- my credibility? Lol? Can you read? My crusade is nothing more than “stop being mor ons and learn to read”. Just because it’s a tradition doesn’t mean it’s a reasonably and well founded tradition. People in this field hold some things up as if they’re legends, beyond questioning or any contrary rational thought. If you have anything to say about my assertions in another thread I’m pretty sure you can find the thread and address them there.

    Btw, that’s just the most lolable of all the doublethink. Truth of the matter is, doublethink is the very basis of the patent system. I had put examples but spamfilter got me. Must have said ha te or something. Dang it was mo ron.

  22. Anon E. Mouse,

    True, but how can action in a state court be reconciled with Bonito if Bilski’s “process/method” does not get through the 101 door?

    In a related vein, what about a federal prosecution under the Economic Espionage Act of 1996 if 101 keeps Bilski on the outside looking in?

  23. JD says “blah blah Reject reject reject”. As has been pointed out to you several times JD, I’m under no such orders unless the claim is blatantly overclaiming into that which is old. If you restrict yourself to what you invented I issue the case. Simple as that. Same thing for the rest of the corps so far as I know. You just don’t like that the arts are so advanced it’s difficult to obtain a really juicy chunk off the carcass of the old. That and you don’t like that examiners are making rejections over bs ref’s so that they don’t have to stay here 60 hours a week like those of us makin more proper rejections. QQ moar, some people prefer having a work/life balance and they’ll doublethink, or singlethink that reject reject reject is just fine as long as it gets them home and away from this bologna. “hur I made a difficult combination” orly? “hur I have unexpected results in that I optimized a previously known result oriented variable” orly? “hur, I can use functional language to make old things new again!” orly? /golfclap.

    If you don’t like reject reject reject then work off the backlog for the pto right fast, get the laws changed so that busi methods and software are unpatentable, obviousness has such a low bar to reach if all the elements are there then it’s obvious, and finally hire on double the examination staff so the production hours can be doubled and reject reject reject will disappear. Simple as that, now hurry up and get all that done alright?

  24. M. Slonecker,

    Yes. Under at least the UTSA, you can be found liable for misappropriating a completely mental process.

    If you can make money from it and you try to keep it secret, it is a TS. It doesn’t matter much what “it” is.
    From the UTSA:

    (4) “Trade secret” means information, including a formula, pattern, compilation, program device, method, technique, or process, that: (i) derives independent economic value, actual or potential, from no being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

    Note that reverse engineering a TS is just fine, though. Just don’t lie, cheat or steal one.

    (2) “Misappropriation ” means: (i) acquisition of a trade secret of another by a person who knows or has reason to know that the trade secret was acquired by improper means; or (ii) disclosure or use of a trade secret of another without express or implied consent by a person who (A) used improper means to acquire knowledge of the trade secret; or (B) at the time of disclosure or use knew or had reason to know that his knowledge of the trade secret was (I) derived from or through a person who has utilized improper means to acquire it; (II) acquired under circumstances giving rise to a duty to maintain its secrecy or limit its use; or (III) derived from or through a person who owed a duty to the person seeking relief to maintain its secrecy or limit its use; or (C) before a material change of his position, knew or had reason to know that it was a trade secret ad that knowledge of it had been acquired by accident or mistake.

  25. e#6k

    Each time you return to this crusade against dependent claims costs you a little more of your credibility. Even if you are truly trolling, presumably you want to retain enough of a rep to allow the trolling to be effective.

  26. Oliver Wendell, “Doublethink” allows a judge to believe deps as currently used in the majority of my cases are proper under 112 as written, sowhat’s your point? Sometimes doublethink goes against the patentee? “Doublethink” pervades the very essence of the patent system today, and arguably is what even allows it to function at all, don’t be surprised when it bites you in the behind every now and again.

  27. Hypo:

    Bilski chooses to retain its “process” as a trade secret.

    Competitor obtains a “copy” by improper means.

    Query:

    Can such a “process” be deemed a trade secret under one or more of the “trade secret” regimes, ie., Restatement of Torts, Restatement of Unfair Competition, UTSA?

    If deemed a trade secret, but “process” deemed excluded by 101, can state court decision be reconciled with Bonito?

  28. Mr. Leopold,

    “Doublethink is an even more insidious tool of the establishment. Doublethink is the ability to hold two contradictory beliefs simultaneously. (I’ve seen it practiced on this board.) Several fascist (and fascist-leaning) governments have learned that doublethink can be taught.”

    You are so right, and the consequences could not be more destructive to our Constitutional democracy.

    Mind Reading and DoubleThink — Ludicrous and Insidious.

    In the CIAS v Alliance (Bally) case I discussed “Mind Reading” in this comment
    link to patentlyo.com
    and I pointed out that a district court tanked a reexamined patent solely because the Judge perceived what was in the mind of an inventors when the inventors described prior art in a Request for Reexamination in the file history, and that the Federal Circuit Affirmed the Judge’s mind reading opinion. This is what the district court Judge wrote in his opinion.
    District court quotes:
    ————————-
    “With that framework in mind, the implication of the inventors’ description is that they understood and claimed the ‘422 patent, in contrast to Shoshani, to use either serial numbers alone or randomly-selected numbers alone.74
    Despite being secondary to the specification, prosecution history can demonstrate ‘how the inventor understood the invention and whether the inventor limited the invention in the course of prosecution, making the claim scope narrower than it would otherwise be.’75” (pps 16-17)

    “Accordingly, the Court construes ‘unique authorized information’ to mean information associated with each object, unique to that object and authorized by the ‘422 patent’s system, but excluding information other than serial information alone or randomly-selected information alone.” (pp 18)
    ————————- end quotes.

    This is what sounds like “Doublethink”:
    When an inventor DOES NOT make a “CLEAR and UNMISTAKABLE” disavowal of claim scope, which is the yardstick for a file history disavowal, as in the CIAS case, the Judge can simply perceive what is in the inventor’s mind to find a “DISAVOWAL” by “IMPLICATION,” which is a CONTRADICTORY yardstick by which to find a disavowal = DOUBLETHINK.

    “Doublethink” allows a Judge to disregard statutory and common law and rule willy nilly style by reading the minds of an inventor to achieve the result he wants despite the heretofore “clear and unmistakable” standard, despite the merits of the patent and the words that embody the invention.

    So, does it look like our courts are fascist-leaning with DOUBLE THINK? A district Judge, the Federal Circuit and yes, the Supreme Court too – the Supreme Court this week denied the CIAS Certiorari Petition. Why would they have taken this case since this is the Supreme Court that gave us Festo in 2002, eBay in 2006 and KSR in 2007, all of which devalued current and future patents?

    For example, with eBay, the incentive for a big business to license an independent inventor’s patent has all but disappeared. Even more important, eBay is unlawful under our Constitution. Many believe as I do – OUR GOVERNMENT NO LONGER OPERATES UNDER OUR CONSTITUTION.

    The point of this example is that the judicial branch of the U.S. government has already wreaked havoc on our nation’s patent system by devaluing current and future American patents by rendering un-Constitutional and game-changing decisions.

    What about the other two branches you ask?

    We know Congressmen act at the behest of International Big Organized Business, IBOB, coalitions, e.g., Congress pushed for grossly onerous Patent Reform, and we know the executive branch appointed PTO officials pushed for similar grossly onerous Patent Reform.

    Who’s behind the judicial branch screwing with our patent system, and who is behind the grossly onerous Patent Reform that was almost successfully rammed down our throats (and they are still trying); WHO IS TO BLAME?

    This Congressional and executive PTO backed Patent Reform runs parallel to the Patent Reform ambitions of IBOB coalitions like “COALITION FOR PATENT FAIRNESS” whose members are largely comprised of the highly successful software new-comers to America’s computer technology field of art and their largest corporate customers who have been brain-washed by the “Coalition for Patent Fairness” members; for example, by reading CISCO SYSTEM’s now defunct horseshit “public service” and allegedly “anonymous” Patent Troll Tracker blog.

    As I mentioned in this comment
    link to patentlyo.com
    I find it telling that no American University or College, NOT A SINGLE ONE, not even the most distinguished IP Professor Crouch’s MIZZOU, the University of Missouri, one of America’s most preeminent research institutions, is a member or associated in any way with this devastating “conspiracy” [e.g., the “Coalition for Patent Fairness”] against America’s strong, use-to-be-proud(er) patent system.

    Moreover, America’s most reputable and seasoned companies, entities that embody our nation’s historic fundamental inventive achievements and strengths, our very backbone, companies like IBM for example, and pharmaceutical companies that have added decades to life expectancy since I passed on, are not associated with conspiracy coalitions that spread treasonous anti-American patent system propaganda.
    ——————–

    Somewhere down the line, gentlemen, you are going to have to take a stand for a strong patent system, or find another profession as American patents lose their importance. Look what’s happened to the value of our dollar.

  29. “I practice that in order to do my job.”

    Yes, the “Quality = Reject, Reject, Reject” mentality you’ve been taught is certainly Orwellian.

    “Surely, those that are ‘convinced’ must, in the back of their minds, be executing doublethink, otherwise they must just be insane.”

    Not really. Winston Smith truly did come to believe that 2+2=5. Just like most of the examiners hired in the past 3-4 years have come to truly believe that “Quality = Reject, Reject, Reject.”

    Room 101 is real. At the PTO, they call it the PTA (Patent Training Academy).

  30. “Doublethink is an even more insidious tool of the establishment. Doublethink is the ability to hold two contradictory beliefs simultaneously. (I’ve seen it practiced on this board.) Several fascist (and fascist-leaning) governments have learned that doublethink can be taught”

    I practice that in order to do my job. I do have to wonder how the courts have gotten so many people go along with some interpretlolations. Surely, those that are “convinced” must, in the back of their minds, be executing doublethink, otherwise they must just be insane.

  31. “Orwell talked about thought crime, he called it doublethink.”

    Not quite. Orwell did talk about thought crime, but he called it … thoughtcrime.

    Doublethink is an even more insidious tool of the establishment. Doublethink is the ability to hold two contradictory beliefs simultaneously. (I’ve seen it practiced on this board.) Several fascist (and fascist-leaning) governments have learned that doublethink can be taught.

  32. “In both cases, however, an individual may be charged with a civil penalty based on that person’s thoughts and memories.”

    There are several critical differences.

    The first is that in the trade secret context, the employee has entered into a contract. There is quid pro quo between the employee, who receives benefits as an employee but who must abstain from using the trade secret. In contrast, in the patent context, a person can be subject to charges of infringement without even knowning of the existence of the patent (which is public information anyway).

    The second critical difference in that the “trade secret” disappears if the employee can prove that he/she subsequently learned of the secret from another source or easily reverse engineered the secret. No such defense is available to a patent infringer.

    These aren’t trivial distinctions. Trade secrets are nothing more than employment contracts. Patents are government grants of 20 year exclusive rights to sue any infringer and are intended to protect novel methods and compositions, not facts or abstract ideas, in exchange for a public disclosure of those methods and compositions. An applicant is not permitted to disclose a fact (i.e., a mathematical relationship or a natural phenomenon) and then sue anyone who dares to base a decision on that fact for the next two decades.

  33. Oh great, so if I just think of the Coke formula I can get sued, at least in Ohio. Orwell talked about thought crime, he called it doublethink.

  34. More specifically, in both this case and in an insider trading case, the defendant uses his thoughts to get an unfair advantage in the marketplace.

  35. But he is not being held liable for his thoughts, memories, or mental processes alone. He is being held liable for using those thoughts to illegally solicit business. I think a closer analogy to this is insider trading, where a person acting on inside information, even if the information was never in any tangible form, is held liable (criminally!) for using their thoughts/memories in an illegal manner.

  36. Anon — I agree that there are distinctions between the mental trade secret information and a patent that is infringed by mental steps. In both cases, however, an individual may be charged with a civil penalty based on that person’s thoughts and memories.

  37. The statutory definition under the USTA of what type of information can constitute trade secrets is much broader than the statutory definition of what types of inventions are patentable under Title 35.

  38. I think that this compare/constrast is misleading.

    In this case, the TS was a customer list — those have been protectable as TS under many circumstances for as long as I know. Lists aren’t a process, just data. Protectable data, but data nonetheless.

    A non-mental TS process can be memorized and stolen (e.g., the formula for Coca Cola or a novel and nonobvious method of manufacturing supercool widgets). That doesn’t make the TS process a mental process in the context of Bilski.

    This case was really just holding that there’s no requirement to write a TS down (whether it be data, process, or what-have-you) in order to misappropriate it. I don’t think that is a controversial holding at all.

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