PATENTS AND TRADE SECRETS Spring 2000 Volume One Professor Rosemary J. Coombe and Brad Limpert (With the Assistance of Abbey-Jane McGrath) 1 2 BOM im LAS UBRARt l jm2nm I fftCULTY Of LM UNIVERSITY OF TORONTO PATENTS AND TRADE SECRETS Spring 2000 Volume One Professor Rosemary J. Coombe and Brad Limpert (With the Assistance of Abbey-Jane McGrath) Digitized by the Internet Archive in 2018 with funding from University of Toronto https://archive.org/details/patentstradesecr01coom PATENTS AND TRADE SECRETS Spring 2000 Volume One Table of Contents I. mSTORY AND POLICY A. Debates about the Doctrine's Rationale Bone, “A New Look at Trade Secret Law: Doctrine in Search of Justification” (1998) . . . 1 Scheppele, “Legal Secrets: Equality and Efficiency in the Common Law” (1989). 15 Bone, “A New Look at Trade Secret Law...” (cont..).32 Kitch, “Law and Economics of Rights in Valuable Information” (1980). 51 B. Employer’s Interests Kugler, “Limiting Trade Secret Protection” (1988). 59 Hitchman, “Trade Secrets and Know-How” (1998). 65 n. THE BASIS FOR THE LEGAL ACTION A. General Principles Coco. v. A. N. Clark Engineers.74 International Tools v. Kollar .77 Saltman Engineering .81 Coco. v. A. N. Clark.81 B. What is the Trade Secret? Faccenda Chicken v. Fowler .83 Sweet Factory v. Hudson’s Bay Co.94 C. Reasonable Precautions to Protect Secrecy "Silicon Valley, Where the Conversation Comes With a Caveat. Ill “The Concept of Reasonableness in the Protection of Trade Secrets” (1987). 113 Crain v. Ashton.119 Tree Savers International v. Savoy.124 m. REMEDIES A. Civil Remedies Pepsi Co. v.Redmond .129 Cadbury Schweppes v. FBI Foods.138 Mercury Marine.157 LAC Minerals.165 B. Criminal Remedies ? R. v. Stewart.168 A. Weinrib, “Information and Property” (1988) . 174 Steele and Trenton, “Trade Secrets: The Need for Criminal Liability” (1998) . 189 IV. PRACTICAL ASPECTS TO TRADE SECRET MANAGEMENT A. Ascertaining Ownership Binns and Robinson, “Co-Ownership of Confidential Information” (1998). 194 B. Before the Employee Leaves Cunliffe, “Maximum Security: How to Prevent Departing Employees from Putting Your Trade Secrets to Work” (1992) . 199 Ridley, et al, “Guidelines for the Use of Confidentiality Agreements” (1999) “A Primer on Nondisclosure Agreements”.208 C. When the Employee Leaves Cunliffe, “Maximum Security...” (cont...).214 D. Before You Hire the Next Employee Cunliffe, “Maximum Security...” (cont...).219 PATENTS I. HISTORY AND PHILOSOPHY Henderson, “An Introduction to Patent Law” (1993). 222 Hettinger, “Justifying Intellectual Property” (1989) . 226 Vaver, “Intellectual Property Myths and Paradoxes” (1990) . 247 Thurow, “Building Wealth” (1999) . 259 • • u n. ECONOMICS OF INNOVATION AND DEVELOPMENT Lehmann, “Property and Intellectual Property” (1989) . 271 Mandeville, “An Information Economics Perspective on Innovation” (1998) . 286 Binkley, “Patent Rights and New Product Development in Canada” (1999). 293 Merges and Nelson, “On the Complex Economics of the Patent Scope” (1990) . 299 Heller & Eisenberg, “Can Patents Deter Innovation?” (1998) . 309 Dickson, “Open House or Closed Shop?” (1999). 313 III. . SUMMARY OVERVIEW Ross, “Beyond the Better Mousetrap” (1987). 315 IV. PREREQUISITES FOR THE PATENT A. PATENTABLE SUBJECT MATTER 1. General Manual of Patent Office Practice.342 Shell Oil v. Commissioner of Patents.344 2. Biotechnology Diamond v. Charkrabarty .348 Pioneer Hi-Bred.356 Harvard Mouse Case.360 3. Computers Diamond v. Diehr.373 Patent Guidelines .374 Schlumberger Canada Ltd. v. Commissioner of Patents.381 Reprinted from Donald H. MacOdrum. Patent Law in Canada: Cases and Materials (Unpublished, 1998 . 382 4. Methods of Doing Business Lawson v. Commissioner of Patents.385 State Street.393 B. OBVIOUSNESS Hayhurst, “Obviousness: The Art of Second Guessing” (1988) . 401 Cooley, “The Status of Obviousness and How to Assert it as a Defence” (1994). 413 Bayer v. Apotex.425 C. NOVELTY Novelty and Non-Obviousness (A Chart).436 1. What Must be Anticipated? Reeves Bros v. Toronto Quilting & Embroidery .439 Diversified v. Tye-Sil.439 2. Prior Publication Beloit v. Valmet.440 3. Public Use Windsurfing Inti v. Tabur Marine.442 4. Experimental Use Canadian Patent Scaffolding v. Delzotto .446 D. UTILITY 1. Introduction 2. Case Law Otta v. Commissioner of Patents.455 X. v. Commissioner of Patents.458 Mettaliflex v. Rodi & Wienenberger Aktengesellschaft .459 Burton Parsons.461 Mentmore Mftg. v.. National Merchandise.466 Hatmaker v. Joseph Nathan.467 Feherguard Products .469 3. The Nature of the Evidence .472 iv