“Secrets” is required reading for informed managers and investors

In an information age that worships data and transparency, the trade or business secret has never been more valuable.  

“Secrets” is an essential guide to understanding, using and profiting from trade secrets, or “know-how,” perhaps the most misunderstood of intellectual property rights.

What I like best about James Pooley’s new book, subtitled Managing Information Assets in the Age of Cyberespionage, is the way he explores the ontology of proprietary business information – what it means, how it has come to exist, and how these secrets can be protected and monetized. He reminds us that even “negative” information can have significant business value.

A Silicon Valley veteran, Pooley has served as a lawyer, manager, diplomat, professor and writer. From 2009 to 2014 he was Deputy Director General for Innovation and Technology at the World Intellectual Property Organization (WIPO), an agency of the United Nations, where he ran the international patent system.

His seminal Trade Secrets for lawyers and Trade Secrets: A Guide To Protecting book_sideProprietary Business Information, first published in 1982 and aimed at business managers, are leading books in the field. Both have been reprinted.

Preferred Protection

Pooley says that despite the attention paid to patents, trade secrets are the preferred method of IP protection for R&D-intensive companies, and are relied upon at more than twice the rate of patents. He says that there are good reasons to have trade secrets:

“They’re cheap: you don’t have to pay for government certification. They’re broad, covering many things that patents can’t (indeed, they cover just about any business information, like sales data and strategic business plans), and unlike a published patent, you don’t broadcast to the competition what you’re doing.”

Enforcing a trade secret typically falls under state law, and there is no Patent Trial and Review Board or history of adverse judicial decisions to challenge their existence. [UPDATE: The Defend Trade Secrets Act, enacted on May 11, 2016, brought trade secrets under a unified federal law.]

“Secrets” provides readers much practical advice, including forms for confidentiality, non-confidentiality and consultant agreements. It is a handy and deceptively insightful book, and will open the eyes of even experienced managers. The book includes sample non-disclosure and other agreements, and suggests best-practices and safeguards that should be put in place before an employee leaves a company to discourage him or her from using or sharing proprietary information.

In reading this book we are remind us that secrets falling into the wrong hands can destroy a project, or even bring down a company. The same technology that enables seamless communications, also makes data theft easy, cheap and increasingly difficult to detect.

Know-How & Patents

Trusting employees, competitors, consultants with classified information, such as the specialized know-how, especially those that bring inventions or patents life, is a high-wire act that managers need help balancing. “Secrets” provides valuable guidance to managing those critical first-steps.

Trade secrets come in many forms. At some companies, patent licenses are effectively “given away,” because they facilitate lucrative technology licenses or know-how sales that enable a licensee to practice an invention more profitably. Just ask IBM. Know-how, sometimes marketed as “consulting,” is frequently the high margin, cash generator that get’s overlooked – the proverbial tail that wags the dog.

For more information about “Secrets,” to order, or for a free digital sample, go here.

Image source: veruspress.com; J. Pooley 




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