2022 Marcom Trends - Magazine - Page 27
order to prove they are “patentable subject matter.” At a
high level, this requirement means that a software patent
must show an advance in the “computer technology space”
and not simply the execution of a well-known process on
a computer. Hundreds of previously-issued patents have
been struck down for failing to meet this requirement; it is
important to carefully consider whether your software meets
patentable subject matter requirements before filing.
The ABCs of Software IP
Devin A. Kothari, Partner, email@example.com
Marc J. Rachman, IP Litigation Partner, firstname.lastname@example.org
Nearly every company is a software company on some level. Below, we discuss how to
protect and enforce your rights in your software:
How can I protect my software under copyright law?
The U.S. Copyright Office has ruled that most
software expresses sufficient creativity and is thus
copyrightable. Specifically, the U.S. Copyright Office
allows the human-readable version of software, called
source code, to be protected by copyright.
How do I protect my software under trade secret?
In addition to being protectable via copyright, source
code can also be protected as a trade secret.
Trade secret = Information that is not
known by others outside of the owner,
has independent economic value
independent of its secrecy, and for
which the owner has taken reasonable
measures to keep secret. Most
software falls into this category, and is
therefore protected as a trade secret.
There is no trade secret registration database
like there is for copyrights and patents. Instead,
companies should take reasonable efforts to protect
26 DAVIS+GILBERT LLP
How do I know I am not infringing someone else’s
To avoid infringement of someone else’s software, the most
important thing is to track where employees are getting their
code. Companies should not be using code from another job
or from the internet without permission, and should not be
reverse engineering or code hacking a third party’s software.
If companies follow these basic restrictions, then, generally
speaking, they will not violate a third party’s software
copyrights or trade secrets.
their software from unauthorized access and use.
These measures will vary based on the value of the
trade secret and the measures others in the industry
take to protect their source code. But, at a high level,
they include physical, electronic and contractual
The “unregistered” copyright in source code attaches
the instant it is typed into a computer. However,
technology companies go a step further and submit
their source code to the U.S. Copyright Office to
get a “registered” copyright. Doing so provides
certain enhanced protections, such as the ability
to file a lawsuit and receive statutory damages.
Importantly, the U.S. Copyright Office has made a
specific exemption for source code to be submitted
in redacted or partial form to make sure the entire
codebase is not made public.
Physical security includes security cameras,
restricted access zones, need-to-know access,
Electronic security includes passwords,
firewalls, encryption, limitations on printing and
Contractual measures include employee
confidentiality agreements, use of Non-Disclosure
Agreements (NDAs), confidentiality clauses in
Is my software patentable?
Some software is patentable. As compared to a
copyright or trade secret, which protects the specific
lines of code that are written by developers, a patent
rarely contains any actual source code. Instead, it
claims the algorithm underlying the software, typically
in flow charts that show how the software architects
a solution to a particular problem. Software patents
must be filed with the U.S. Patent Office, which will
review the patent before it issues.
Because software patents exclude others from
practicing in a space even if they did not explicitly
copy the software, they are much more difficult to get
than other forms of intellectual property protection.
For example, software patents must be novel and
non-obvious. They also must pass heightened scrutiny in
Another option to consider is to use a defensive patent
aggregator, which acts almost like an insurance policy. A
defensive patent aggregator acquires patent rights to make
available to its members for an annual fee. These patents are
strategically purchased by the aggregator to stave off patent
troll claims for its members.
What if an employee leaves with software or
Protecting a company’s technology upfront can prevent
disputes over ownership down the road. It is a best practice
to require employees to enter into Work for Hire agreements
upon joining the company, agreeing that whatever technology
they participate in as part of their employment is a work for
hire that is owned by the company, not the employee, despite
whatever they may have contributed to the development of
With such an agreement signed by the employee, any claim
that they have rights in the company’s technology when they
leave can be quickly addressed. It is also important to have
employees agree to NDAs at the onset of their employment
to protect any potential trade secret information belonging
to the company from being used to compete against the
company when they leave.
Avoiding patent infringement is much more difficult, as one
does not need to know of a patent or explicitly copy a patent
to infringe. There are many weak software patents on basic
internet functionalities which are asserted indiscriminately
against legitimate companies by “patent trolls”, also referred
to as Non-Practicing Entities (“NPEs”).
If companies are concerned about software infringing a third
party’s patent, discuss doing a “freedom to operate” search
with counsel, who can pull relevant patents and analyze
how similar they are to your software. If a specific patent is
discovered that could be similar, companies must design
around it; otherwise, they could be liable for enhanced
damages for willful infringement.
How do I best protect myself from patent troll claims?
Although there is no sure–fire way to prevent a patent claim
from being asserted against a company, there are steps
that can be taken to help defray the costs once a claim is
threatened or raised.
One way to reduce potential exposure is to negotiate a
patent indemnity provision in contracts with technology
providers that puts the responsibility for any patent claims
relating to the technology on the provider. If a claim is raised,
companies can seek indemnification for the claim from the
What if someone comes out with software that
competes against your software?
If someone believes that there might be infringement on
patented technology, the best thing to do is to seek the
advice of counsel to determine whether the patent is being
infringed. If it is determined that the competing software is
infringing, counsel will then advise you on the next steps that
should be taken, which can include sending a cease and
desist letter or filing a lawsuit.
What if I get a letter asking to pay for a license or
threatening an infringement claim?
Depending upon the history of the party sending the letter,
you may be better off responding rather than taking a wait
and-see approach. Legal counsel can assist with making this
assessment, as often they will have had prior experience with
the patent owner making the threat or seeking the license.
TRENDS IN MARKETING COMMUNICATIONS LAW 27