WIPO/NIFT National Seminar on the Importance of IP for the Handicrafts Sector Hyderabad, India, April 5-7, 2005 - PowerPoint PPT Presentation

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WIPO/NIFT National Seminar on the Importance of IP for the Handicrafts Sector Hyderabad, India, April 5-7, 2005

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National Seminar on the Importance of IP for the Handicrafts Sector Hyderabad, India, April 5-7, 2005 Keeping Confidence: The Role of Trade Secret Protection in ... – PowerPoint PPT presentation

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Title: WIPO/NIFT National Seminar on the Importance of IP for the Handicrafts Sector Hyderabad, India, April 5-7, 2005


1
WIPO/NIFTNational Seminar on the Importance of
IP for the Handicrafts SectorHyderabad, India,
April 5-7, 2005

2
Keeping Confidence The Role of Trade Secret
Protection in Business Success Lien
VerbauwhedeConsultant, SMEs DivisionWorld
Intellectual Property Organization (WIPO)

3
This Presentation
  • PART 1 - Outline
  • Definition
  • Legal requirements
  • Rights
  • Enforcement
  • PART 2 - Protection Strategies

4
PART 1WHAT ARE TRADE SECRETS ?
5
What are trade secrets?
  • Broadly speaking
  • any confidential information
  • which provides an enterprise with a competitive
    edge
  • can qualify as a trade secret
  • ? entitled to legal protection

6
Metal Mirrors of Aranmula

7
Metal Mirrors of Aranmula
  • Some undisclosed metals are alloyed with copper
    and tin to cast the Aranmula kannadi in typical
    clay moulds.
  • The exact proportions of the two metals and the
    techniques of crafting it into an excellent
    reflecting surface is always kept as a trade
    secret.
  • The method is the age-old lost-wax process in
    traditional style after melting the metals in a
    furnace fitted with a manual blower.
  • Today, only five artisan families know the the
    metallurgical secret of the Aranmula kannadi, the
    world-famous metal mirrors.

8
Cotton Dyeing Technique
  • 5th century BC the Greek historian Herodotus,
    marveled at the quality of Indian cotton.
  • Textile trade cotton, silk, woven textiles. The
    beauty, brilliance, color range and fastness of
    Indian fabrics was held in high esteem.
  • India managed to keep the technique of cotton
    dyeing a secret from the world until the 17th
    century.

9
What are trade secrets?
  • A trade secret can relate to different types of
    information
  • technical and scientific
  • commercial
  • financial
  • negative information

10
Examples (1)
  • Technical and scientific information
  • technical composition of a product
  • paint
  • manufacturing methods
  • weaving technique, baking clay, metal casting,
    embroidery
  • know-how necessary to perform a particular
    operation
  • how to dye with natural Dyes?
  • designs, drawings, patterns, motifs

11
Examples (2)
  • Commercial information
  • list of clients
  • customer buying preferences
  • supplier arrangements
  • business plan
  • marketing strategy

12
Examples (3)
  • Financial information
  • internal cost structure
  • price lists
  • Negative information
  • details of failed efforts to remedy problems in
    the manufacture of certain products
  • unsuccessful attempts to interest customers in
    purchasing a product

13
What qualifies as a trade secret?
  • Three essential legal requirements
  • 1. The information must be secret
  • wheel technique for pottery is no trade secret
  • 2. It must have commercial value because its
    secret
  • 3. You must have taken reasonable steps to keep
    it secret
  • not generally known among or readily
    accessible to persons within the circles that
    normally deal with this kind of information

14
  • Only protection against improperly acquiring,
    disclosing or using
  • people who are automatically bound by duty of
    confidentiality (incl. employees)
  • people who have signed non-disclosure agreement
  • people who acquire a trade secret through
    improper means
  • theft, industrial espionage, bribery

15
  • Some people cannot be stopped from using
    information under trade secret law
  • people who discover the secret independently,
    without using illegal means or violating
    agreements or state law
  • people who discover through reverse engineering

16
  • Independent discovery and reverse engineering
    no trade secret protection
  • - bamboo blinds -

17
  • Reverse engineering
  • - van Eycks visual effects -

18
  • Reverse engineering - van Eyck
  • van Eyck's methods for achieving his breathtaking
    visual effects
  • Washington National Gallery of Art - technical
    study
  • microscopic examination of the surface
  • technical analysis of the painting
  • infrared reflectography ? underdrawing is visible

19
  • Procedure - Altarpiece of the Holy Lamb in Ghent
    a first layer in grayish blues establishing light
    and shade a second solid blue layer to soften
    the contrast of the first a final, rich blue
    glaze of ultramarine in a water-based protein
    medium such as glue
  • Composition of paint linseed oil, no water-based
    protein admixtures to the oil
  • Technique preliminary layer of vermilion,
    different layers of glaze

20
  • TRADE SECRET PROTECTION PROVIDES
  • NO
  • EXCLUSIVITY

21
What can you do if someone steals or
improperly discloses your trade secret? ?
Enforcement
22
Enforcement
  • Remedies
  • 1. Order to stop the misusing
  • 2. Compensation for damages caused as a result
    of the misuse
  • 3. Recover profits (unjust enrichment)
  • 4. In India seizure order can be obtained to
    search the violator's premises in order to
    obtain the evidence to establish the theft of
    trade secrets at trial

23
Enforcement
  • To establish violation, the owner must be able to
    show
  • infringement provides competitive advantage
  • reasonable steps to maintain secret
  • information obtained, used or disclosed in
    violation of the honest commercial practices
    (misuse)

24
PART 2BUSINESS STRATEGIES TO HANDLE PROTECT
TRADE SECRETS
25
Loss of trade secrets - a growing problem (1)
  • Why is this occurring?
  • way we do business today (increased use of
    contractors, temporary workers, out-sourcing)
  • declining employee loyalty, more job changes
  • organized crime discovered the money to be made
    in stealing high tech IP
  • storage facilities (CD-ROM, floppies, etc)
  • expanding use of wireless technology

26
Loss of trade secrets - a growing problem (2)
  • Examples of outside threats
  • burglaries by professional criminals targeting
    specific technology
  • attempted network attacks (hacks)
  • laptop computer theft source code, product
    designs, marketing plans, customer lists
  • calls headhunters, presenting themselves as
    employee
  • corporate spies

27
Loss of trade secrets - a growing problem (3)
  • Examples of inside threats
  • 80 of information crimes lt employees,
    contractors, trusted insiders!
  • malicious destruction/erasure of RD data by
    avenging employee
  • theft by former employee of business plans
  • ignorance

28
What can be done? ? 9 basic protection
strategies
29
1. Identify trade secrets
  • Considerations in determining whether
    information is a trade secret
  • Is it known outside your enterprise?
  • Is it widely known by employees and others
    involved within your enterprise?
  • Have measures been taken to guard its secrecy?

30
  • What is the value of the information for your
    business?
  • What is the potential value for your competitors?
  • How much effort/money spent in collecting or
    developing it?
  • How difficult would it be for others to acquire,
    collect of duplicate it?

31
2. Develop a protection policy
  • Advantages of a written policy
  • Clarity (how to identify and protect)
  • How to reveal (in-house or to outsiders)
  • Demonstrates commitment to protection ? important
    in litigation

32
3. Educate employees
  • Prevent inadvertent disclosure (ignorance)
  • Employment contract
  • Brief on protection expectations early
  • NDA/CA/NCA
  • obligations towards former employer!
  • Departing employees
  • exit interview, letter to new employer, treat
    fairly compensate reasonably for patent work,
    further limit access to data

33
  • Educate and train
  • Copy of policy, periodic training audit, etc.
    Make known that disclosure of a trade secret may
    result in termination and/or legal action
  • Clear communication and repetition
  • TS protection must be part of the enterprise
    culture
  • Every employee must contribute to maintain the
    security environment
  • Monitor compliance, prosecute violators

34
4. Restrict access
  • to only those persons having a
  • need to know
  • the information
  • ?

35
5. Mark documents
  • Help employees recognize trade secrets ? prevents
    inadvertent disclosure
  • Uniform system of marking documents
  • paper based
  • electronic (e.g. confidential button on
    standard email screen)

36
6. Physically isolate and protect
  • Separate locked depository
  • Authorization
  • Access control
  • log of access person, document reviewed
  • Surveillance of premises
  • guards, surveillance cameras
  • Shredding

37
7. Maintain computer secrecy
  • Secure online transactions, intranet, website
  • Access control (authorization, password)
  • Mark confidential or secret (legend pop, or
    before and after sensitive information)
  • Physically isolate and lock computer tapes,
    discs, other storage media
  • Monitor remote access to servers
  • Firewalls anti-virus software encryption

38
8. Restrict public access to facilities
  • Log and visitors pass
  • Accompany visitor
  • Sometimes NDA/CA
  • Visible to anyone walking through a companys
    premises
  • type of machinery, layout, physical handling of
    work in progress, etc
  • Overheard conversations
  • Documents left in plain view
  • Unattended waste baskets

39
9. Third parties
  • Sharing for exploitation
  • Consultants, financial advisors, computer
    programmers, website host, designers,
    subcontractors, joint ventures, etc.
  • Confidentiality agreement, non-disclosure
    agreement
  • Limit access on need-to-know basis

40
Remember
  • No registration, but 3 requirements for legal
    protection
  • No need for absolute secrecy, but reasonable
    measures
  • Developing and maintaining TS program
  • lt good business practice to prevent
  • lt legal requirement to enforce TS protection

41
  • Only legal protection against dishonest
    acquisition/disclosure/use
  • Consider alternative protection

42
  • TRADE SECRET PROTECTION
  • IS LIKE
  • AN INSURANCE

43
  • Thank You!
  • WIPOs website for SMEs
  • http//www.wipo.int/sme
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