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Nondisclosure Agreements Post AIA

Non-disclosure agreements ("NDAs") and confidentiality agreements are now crucial to protecting potential patents, but users should be cautious and speak with counsel before disclosing inventions even with an NDA.  After decades of allowing potential inventors to test the marketplace with their inventions, our patent system has been shifted from a “first to invent” system to a “first to file” system and altered the activities allowed to an inventor prior to a patent filing.

Under the old U.S. patent system, an inventor was allowed the opportunity to market his or her invention for one year prior to a patent filing.  If another patent application was filed prior to the inventor’s filing for patent, the U.S. system allowed the inventor who could prove he or she was the first inventor to be awarded the patent.  Now, the first inventor to file at the United States Patent & Trademark Office is granted to the patent.  Moreover, public use or public sale of an invention prior to a patent filing may act as a bar to patenting the invention.

NDAs and confidentiality agreements will allow the parties to keep the disclosure confidential, but an inventor still runs the risk that a third party will file separately before the disclosing inventor.  Many NDAs and confidentiality agreements provide an exception for parties who may have developed the technology separately.  The party receiving the information could then proceed with filing before the inventor after recognizing the potential for the invention.

As a result of the changes to the patent laws, it is important for inventors and businesses to communicate with their counsel before disclosing inventions.

For more information on these matters please contact Meredith Lowry at mlowry@smithhurst.com or at 479.301.2444.

The information presented in this article does not constitute or contain legal advice, and neither our presentation of such information nor your receipt of it will create any attorney-client or confidential relationship.

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