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April 11, 2024 | BusinessIntellectual PropertyNew York

To Patent, or Not to Patent: Patenting vs. Trade Secret Protection

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David Fish

Senior Counsel

Ellie Sanders

Associate Attorney

In the realm of innovation and entrepreneurship, safeguarding intellectual property (IP) is paramount.  Two common methods for protecting inventions are patents and trade secret protection.  Each avenue offers distinct advantages and drawbacks, necessitating careful consideration based on the nature of the invention and your business objectives.

What is a patent?

A patent is a type of intellectual property protection.  A patent grants the patent holder the exclusive right to prevent others from making, using, importing, and selling the patented innovation for a limited period.

The benefits of obtaining a patent include:

  • Exclusive Rights: Patents grant inventors exclusive rights to their inventions, preventing others from making, using, selling, or importing the patented invention without permission. The exclusive rights a patent provides allows the holder to commercialize their invention and license its use to others in the marketplace.
  • Legal Recourse: Patent holders have legal recourse against infringement. This protection can deter competitors and enhance the value of the invention.

The drawbacks of obtaining a patent include:

  • Cost and Time: Obtaining a patent can be a costly and time-consuming process, involving attorney fees, government filing fees, and prosecution expenses. In the patent context, the term “prosecution” refers to the entire patenting process from the initial draft up until the patent is granted or rejected by the US Patent Office.  The patent application process typically takes several years, which can delay receiving the legal protection and potentially impede market entry.
  • Limited Duration: Patents have a finite lifespan, typically 20 years from the filing date. Once the patent expires, the invention enters the public domain, allowing competitors to freely exploit it without repercussions.
  • Disclosure Requirements: Patent applications require detailed disclosures, exposing the invention to competitors who may attempt to design around the patent or challenge its validity.

What is trade secret protection?

A trade secret is any practice or process of a company that is generally not known outside of the company.  Most states, including New York, have adopted laws to protect trade secrets.  At the federal level, the Defend Trade Secrets Act provides legal recourse against those who misappropriate trade secrets.

The benefits of claiming trade secret protection for your invention include:

  • Infinite Duration: Unlike patents, trade secrets can potentially be protected indefinitely, as long as the information remains confidential and efforts are made to maintain its secrecy. This perpetual protection offers long-term competitive advantages.
  • Cost-Effectiveness: Trade secret protection generally incurs lower costs compared to patents. There are no registration fees or formal application processes, making it an attractive option for resource-constrained businesses.
  • Flexibility: Trade secret protection can be applied to a broad range of intellectual assets, including formulas, processes, customer lists, and software algorithms. This flexibility allows businesses to safeguard various types of proprietary information.

The main drawback of claiming trade secret protection is the risk of disclosure.  Trade secrets are vulnerable to inadvertent disclosure, particularly in collaborative environments or during employee turnover.  Once disclosed, trade secrets lose their protective status and cannot be reclaimed.

Should I protect my invention under patent law or under trade secrets law?

Deciding whether to obtain a patent or protect your invention as a trade secret depends on your goals.  If you want to sell your invention or license its use to others in the marketplace, seeking a patent is a better option.  Because you cannot disclose your trade secrets publicly and keep them protected, it wouldn’t make sense to protect an invention you want to sell as a trade secret.  In other words, you would not be able to disclose the trade secret to a potential buyer because it would lose its status as a trade secret.

On the other hand, if you want to keep your invention as secret as possible, then protecting it as a trade secret makes more sense, because you would have to disclose the mechanics and inner workings of your invention in a patent application.  Patent applications are publicly available.  For example, KFC’s spice blend and Coca-Cola’s formula are protected as trade secrets, because these companies want no one to know how to replicate their inventions.


The decision to patent or maintain trade secret protection depends on various factors, including the nature of the invention, commercialization strategy, budget constraints, and risk tolerance.  Businesses must weigh these considerations carefully to devise an IP strategy aligned with their objectives.  Consulting with a seasoned IP attorney can provide guidance in navigating this complex terrain and maximizing the value of intellectual assets.  Reach out to a member of our team for next steps.



Photo by Getty Images on Unsplash
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