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Attorneys at Law Hannover
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K枚nigstra脽e 80
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Fon +49 711.99 58 55-90
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Know-How Protection


1. Introduction to Know-How Protection

Know-how refers to valuable, confidential business information that provides a competitive advantage. Unlike patents or trademarks, know-how does not require registration but is protected as a trade secret under various legal frameworks.

Know-how protection is vital for industries where proprietary processes, techniques, or formulas are critical for success, such as manufacturing, technology, pharmaceuticals, and software development.


2. Definition of Know-How

Know-how encompasses:

  1. Technical Information:
    • Proprietary processes, formulas, or designs.
    • Engineering methods or manufacturing techniques.
  2. Commercial Information:
    • Marketing strategies, customer databases, or pricing models.
  3. Non-Tangible Knowledge:
    • Expertise or experience developed over time.

To qualify for protection, know-how must:

  1. Be secret (not generally known or easily accessible).
  2. Have commercial value due to its secrecy.
  3. Be subject to reasonable steps to maintain its confidentiality.


3. Legal Framework for Know-How Protection

  1. European Union:
    • Governed by the EU Trade Secrets Directive (2016/943), which harmonizes trade secret protection across member states.
  2. Germany:
    • Implemented through the Gesetz zum Schutz von Gesch盲ftsgeheimnissen (GeschGehG).
  3. United States:
    • The Defend Trade Secrets Act (DTSA) provides federal protection for trade secrets.
  4. International Framework:
    • The TRIPS Agreement under the WTO obliges member countries to protect undisclosed information.


4. Requirements for Protection

To be protected as a trade secret or know-how, the information must:

  1. Be Secret:
    • Not be publicly known or easily deducible by competitors.
  2. Have Economic Value:
    • Provide a competitive advantage.
  3. Be Protected:
    • Reasonable measures must be taken to maintain secrecy, such as non-disclosure agreements (NDAs) or access controls.


5. Legal Consequences of Protection

  1. Exclusive Rights:
    • The owner of the know-how can prevent unauthorized acquisition, use, or disclosure by third parties.
  2. Damages:
    • Remedies for unauthorized use include damages, injunctions, and destruction of unlawfully obtained materials.
  3. No Time Limits:
    • Unlike patents, protection lasts as long as the know-how remains secret and protected.


6. Examples of Know-How

  • Coca-Cola Formula: A classic example of a trade secret maintained over decades.
  • Software Algorithms: Proprietary algorithms used in applications like search engines or recommendation systems.
  • Manufacturing Techniques: Specialized methods for producing high-performance materials or components.


7. Misappropriation and Legal Actions

Misappropriation occurs when:

  1. Know-how is acquired through improper means (e.g., theft, bribery, or industrial espionage).
  2. Know-how is disclosed or used without authorization, in violation of contractual or legal obligations.

Legal remedies include:

  • Civil Actions: Damages and injunctions.
  • Criminal Prosecution: In cases of theft or fraud.
  • Administrative Actions: Regulatory penalties or investigations.


8. Procedures for Maintaining Know-How Protection

  1. Non-Disclosure Agreements (NDAs):
    • Legal agreements requiring parties to maintain confidentiality.
  2. Restricted Access:
    • Limiting access to sensitive information through physical and digital safeguards.
  3. Internal Policies:
    • Clear policies for employees, contractors, and partners regarding the handling of confidential information.
  4. Audits and Monitoring:
    • Regular audits to ensure compliance and identify potential risks.


9. Relevant Court Decisions

  1. EU Case Law:
    • CJEU decisions interpreting the EU Trade Secrets Directive, such as C-637/19 SkyKick on the scope of reasonable protection measures.
  2. US Case Law:
    • Waymo v. Uber: A landmark trade secrets case involving autonomous vehicle technology.
  3. German Case Law:
    • Federal Court decisions emphasizing the importance of explicit confidentiality measures under the GeschGehG.


10. Typical Agreements Involving Know-How

  1. Non-Disclosure Agreements (NDAs):
    • Define confidential information and obligations for maintaining secrecy.
  2. Technology Transfer Agreements:
    • Licensing of proprietary methods or know-how for use by third parties.
  3. Employment Contracts:
    • Confidentiality clauses to protect know-how during and after employment.
  4. Joint Development Agreements:
    • Agreements governing the creation and sharing of know-how in collaborative projects.


11. European and International Protection Mechanisms

  1. European Union:
    • Harmonized by the EU Trade Secrets Directive.
  2. United States:
    • Protection through federal and state laws, with a strong emphasis on civil remedies.
  3. International Treaties:
    • TRIPS Agreement requires WTO members to protect trade secrets.
  4. WIPO Support:
    • Facilitates knowledge-sharing while respecting proprietary information.


12. Future Developments

  1. Digital Threats:
    • Cybersecurity challenges increase risks to trade secrets and know-how.
  2. AI-Driven IP:
    • Managing the confidentiality of know-how used in or created by AI systems.
  3. Global Harmonization:
    • Efforts to align trade secret laws across jurisdictions for consistent enforcement.


13. Alternative Protection Mechanisms

  1. Patents:
    • For inventions that meet novelty and inventiveness criteria.
  2. Copyright:
    • Protects software code or technical drawings associated with know-how.
  3. Trademarks:
    • Complementary protection for branding tied to know-how.


14. What We as a Law Firm Can Offer

  1. Advisory Services:
    • Identifying and categorizing know-how for optimal protection.
  2. Policy Development:
    • Drafting internal policies and guidelines to secure proprietary information.
  3. Contract Drafting:
    • NDAs, employment agreements, and technology transfer contracts tailored to your needs.
  4. Litigation and Enforcement:
    • Representing clients in disputes over misappropriation or unauthorized use.
  5. Risk Assessment:
    • Evaluating vulnerabilities and implementing safeguards against data breaches.
  6. Global Strategies:
    • Harmonizing know-how protection across jurisdictions for multinational operations.
  7. Training:
    • Educating employees and stakeholders on best practices for protecting know-how.

By offering end-to-end legal services, we ensure your know-how remains a competitive advantage, safeguarded against internal and external threats.

 

 

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