Not every valuable innovation should be patented. Customer lists, manufacturing know-how, formulas, and source code can remain protected indefinitely — but only while genuinely secret and reasonably protected.
The legal test
Trade secret protection generally requires that the information be secret, have commercial value because it is secret, and be subject to reasonable steps to keep it secret. Fail on any prong and the protection evaporates.
Reasonable steps in practice
- Access controls and need-to-know segmentation
- Confidentiality clauses in employment contracts
- Vendor NDAs that survive contract termination
- Exit interviews that document return of materials
- Logging of access to crown-jewel repositories
Trade secret versus patent
The choice is strategic, not automatic. Reverse-engineerable inventions may be better patented; processes that cannot be discovered from the product may be better kept secret. The decision should be revisited as the product and market mature.
When secrets walk out the door
Employee mobility is the largest single source of trade secret loss. A combination of clear policies, technical controls, and rapid legal response on departure makes both recovery and future deterrence realistic.
