Thursday, 3 December 2015

Trade secrecy: the last frontier for IP analytics?

Suddenly and almost without warning, the IP topic on everyone's lips is trade secrecy.  Writing on the IPKat weblog earlier this week (here and here), Magic Circle patent litigation lawyer Annsley Merelle Ward narrates the debate before the Senate Judiciary Committee as to whether a Federal Defend Trade Secrets Act should replace the current Uniform Trade Secrets Act -- an ill-fitting uniform since it fails to cover two important jurisdictions that did not adopt it: New York and Massachusetts.  

This is a national debate with a global sub-plot.  Professor Sharon K. Sandeen, who has co-authored a new book on the subject that will shortly be reviewed on this weblog, is arguing that a new Federal law will make US law the effective gold standard for trade secrets law internationally.

Trade secrecy is a topic that represents a sort of Everest for IP analytics.  Patents, utility models and industrial design rights form part of a corpus of data that can be accessed, sliced, diced and generally made intelligible for investors, innovators, speculators and the rest.  However, it is at the level of know-how and knowledge gained from experience and empirical experimentation that patents and other registered IP rights are turned from mere barriers to market entry and metamorphosed into medicines, consumer goods, manufacturing equipment, communications processes and other real-world items and services that people pay money for.

There is no data set comprising trade secrets, confidential information and the like.  Much of this information is the subject of technology transfer licences, joint venture agreements and other contractual arrangements that provide for this valuable information to be assigned or shared on a limited basis.  The fact that confidential information is not registered is not decisive in this regard: other non-registered rights such as copyrights and many forms of design right can still, for example, be treated as an asset class, commoditised, valued and securitised with far greater facility than the amorphous body of trade secrets.

Is this then the point beyond which IP analytics simply cannot go?  Or does someone know, but isn't telling ...?  

Do let us know what you think by posting a comment below.


  1. I've just come back to see if there were any good ideas. Not surprised that there weren't. Trade secrets are a hopeless case. What a shame, because a failure to filter them into the big picture offered by Big Data makes it much less useful.

  2. @Anonymous

    The basic thing about trade secrets is that they are Small Data. They can be significant in their own right, in specific businesses, but they don't really bear the characteristic features of an asset class.

    Curiously enough it is their unique, vulnerable and uncategorizable nature that helps give value to cybersecurity patents which this blog has posted on here today.

  3. One use case for know-how is confidential datasets that may well result in inventions as a result of analysis. I have seen this happen where an R&D company pays a university to carry out some analysis on its data (the know-how), but it wants to claim ownership to any inventions that might result.