Confidentiality Agreements - often a false confidence
Confidentiality agreements are a mixed blessing and must be used with caution. They should be used appropriately and ideally only to guard against disclosure by sub-contractors in the construction of prototypes for testing, or evaluating manufacturing processes and problems. Preferably (depending on the situation) a patent application (and applications for any other form of protection) should already have been filed.
Confidentiality agreements in their simplest form witness that the parties have agreed that certain information and material is to remain in confidence. In some instances the agreement may be extended to include ownership of IP should any development result from the involvement of one of the parties. This is a worthwhile inclusion in most agreements even if you do not initially envisage any contribution from the other party - it is better to allow for the possibility in advance than to try and work everything out afterwards.
It is generally recommended that, unless a patent application has been filed, confidentiality agreements are NOT relied upon when approaching other parties regarding the sale of your invention. Regardless of the agreement, this may be seen as a commercialisation of your invention which is regarded as a disclosure. Consequently it is recommended that applications for protection have still been filed first, before approaching parties regarding sale.
What if there has been unauthorised disclosure of your invention? If things fall apart you must rely on the law to enforce any rights. A confidentiality agreement does not grant you any rights to an invention. It merely acknowledges that the other party agreed to keep things in confidence. If they don't then the document can be used to ensure novelty is not destroyed (due to any disclosure being unauthorised) but you may still be required to begin filing your applications as soon as possible - this may contrast with the schedule you had already mapped out. Additionally, if advantage is taken of this remedy in applying for a patent, and the patent is ever opposed or the subject of litigation, whether the disclosure was truly unauthorised may be challenged.
For this reason written and signed confidentiality agreements (as opposed to verbal arrangements) are recommended. This can be used to establish that any act of disclosure by another party was contrary to your instructions. Being able to provide such documentation can potentially save considerable expense - particularly if the point is ever challenged for one of your overseas patents.
You might also be able to seek damages if the actions of the other party has caused you considerable loss through their actions but this is likely to be a difficult and drawn out process with no guarantee of success.
Primarily, confidentiality agreements should be relied upon as a lasting reminder to others of their obligation of confidentiality, and as a written document to be presented to various Patent Offices to preserve novelty should unauthorised disclosure occur. Using them inappropriately is often a recipe for disaster.
Confidentiality agreements are a mixed blessing and must be used with caution. They should be used appropriately and ideally only to guard against disclosure by sub-contractors in the construction of prototypes for testing, or evaluating manufacturing processes and problems. Preferably (depending on the situation) a patent application (and applications for any other form of protection) should already have been filed.
Confidentiality agreements in their simplest form witness that the parties have agreed that certain information and material is to remain in confidence. In some instances the agreement may be extended to include ownership of IP should any development result from the involvement of one of the parties. This is a worthwhile inclusion in most agreements even if you do not initially envisage any contribution from the other party - it is better to allow for the possibility in advance than to try and work everything out afterwards.
It is generally recommended that, unless a patent application has been filed, confidentiality agreements are NOT relied upon when approaching other parties regarding the sale of your invention. Regardless of the agreement, this may be seen as a commercialisation of your invention which is regarded as a disclosure. Consequently it is recommended that applications for protection have still been filed first, before approaching parties regarding sale.
What if there has been unauthorised disclosure of your invention? If things fall apart you must rely on the law to enforce any rights. A confidentiality agreement does not grant you any rights to an invention. It merely acknowledges that the other party agreed to keep things in confidence. If they don't then the document can be used to ensure novelty is not destroyed (due to any disclosure being unauthorised) but you may still be required to begin filing your applications as soon as possible - this may contrast with the schedule you had already mapped out. Additionally, if advantage is taken of this remedy in applying for a patent, and the patent is ever opposed or the subject of litigation, whether the disclosure was truly unauthorised may be challenged.
For this reason written and signed confidentiality agreements (as opposed to verbal arrangements) are recommended. This can be used to establish that any act of disclosure by another party was contrary to your instructions. Being able to provide such documentation can potentially save considerable expense - particularly if the point is ever challenged for one of your overseas patents.
You might also be able to seek damages if the actions of the other party has caused you considerable loss through their actions but this is likely to be a difficult and drawn out process with no guarantee of success.
Primarily, confidentiality agreements should be relied upon as a lasting reminder to others of their obligation of confidentiality, and as a written document to be presented to various Patent Offices to preserve novelty should unauthorised disclosure occur. Using them inappropriately is often a recipe for disaster.
