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What are the differences between patent and trade secret protection?

Trade secret and patent protection vary in terms of filing requirements, potential duration, need for secrecy and ability to protect information.

When businesses in Oregon wish to protect intellectual property, they are usually limited to seeking one type of protection based on the nature of the asset. Works of creative authorship, for instance, can only be shielded through copyright protection. Businesses that possess economically valuable information, however, have two choices: patent and trade secret protection. Understanding the differences between each is critical for people who are evaluating how best to protect their property.


Businesses looking to protect intellectual property by patenting it must go through an official registration process, which may require significant time, money and effort. During this process, a person must document the creation of the invention; conduct research to ensure that it does not infringe on existing patents; prepare a formal application; and pay filing and registration fees.

Trade secret protection, in contrast, does not require formal registration. If a business possesses information that qualifies as a trade secret, it enjoys free and immediate protection. Under Oregon law, information is considered a trade secret if its confidentiality gives it economic value and if reasonable efforts have been made to keep the information secret.


Due to this definition, a trade secret loses its legal protection if a business fails to keep the information confidential. Businesses may need to take multiple steps to preserve this form of protection, including the following:

· Investing in physical and virtual security to prevent unauthorized access to the information

· Requiring employees with knowledge of the secret to sign a covenant not to compete

· Using nondisclosure agreements to prevent third parties from sharing the secret

In contrast, when a business obtains patent protection, the information no longer needs to be kept secret.


Patent protection lasts for a predetermined amount of time, which may be up to 20 years, while trade secret protection persists indefinitely. However, the latter form of protection may expire if a business does not take adequate steps to maintain secrecy or if a third party independently discovers the information through legitimate means. Therefore, businesses must weigh the likelihood of information being discovered against the limited duration of patent protection.


Overall, patents offer a high level of legal protection by completely prohibiting other parties from using the information for a prescribed period of time. Trade secret protection gives businesses some recourse by prohibiting misappropriation and allowing them to seek appropriate damages, such as royalties, if misappropriation occurs. Still, this protection is conditional on the business’s ability to keep a trade secret confidential.

For many business owners, determining which legal option offers the best fit may be challenging. Consequently, most businesses in possession of valuable proprietary information can benefit from consulting with an attorney regarding their objectives and legal options.

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