How To Protect A Software Idea From Being Stolen
“How do I protect my software idea” is a question that we frequently get asked by our software development clients. It is understandable that before you make an investment of your time and money for a web or mobile app, that you would want to know upfront how to protect your investment.
While we are not lawyers, in this article we explain some of the main concepts and approaches so you can become familiar with the terms and options. Our intention is to give you a good foundation so you can make an informed decision on what’s right for you and your company.
Idea vs. an Invention
There is a difference between an idea and an invention when it comes to protecting your software. While there are ways you can protect your idea from being stolen before you write your application, which we will discuss below, you will have more ability to protect your idea once it is developed.
The first step in protecting your idea is limiting who you share it with. If you are concerned that your idea might get stolen and developed before you can take it to market, then the fewer people you disclose it to, the better.
When you do share your idea, ask the individuals or company you are working with to sign a Non-Disclosure agreement (NDA). An NDA is an agreement to protect trade secrets and other confidential information such as schematics, design documents, requirements documents, and pricing.
By signing an NDA, the participants promise not to divulge or release information shared between them. If the information is leaked, the injured party can claim a breach of contract.
If you would like to see a sample NDA, you can download a copy of our NDA here.
The biggest thing that you as a product or software owner need to do is make sure you have ownership of your software. If you hire a third party to develop the software on your behalf, make sure your contract assigns all rights to you. This includes any documentation produced during the design and development process as well as all code written.
Another thing to watch out for are the tools/platforms/technologies your software vendor is using. If your software vendor is using a 3rd party tool or platform to build your application, make sure you have the right to license and use all 3rd party technologies if you ever decide to no longer work with your software vendor.
A copyright is a law that gives a creator ownership over the things they create. It could be a painting, a photography or even software. The copyright law is what assures your ownership and certain rights that you have exclusively as the owner.
A copyright goes into effect as soon as you start creating your work. While you do not need to do anything special to claim a copyright, in order to sue for infringement, you will need to have a federally registered copyright. It is a fairly inexpensive process and one you may consider as a matter of course.
Once you have an invention, you can then look into a patent. A patent grants a set of exclusive rights to an inventor or assignee for a limited period of time in exchange for providing a detailed disclosure of the invention to the public.
The two different types of patents are a utility patent and a design patent. A utility patent is for anyone who invents a useful process, machine, item that is manufactured, or a new and useful improvement for one of those previously mentioned things. If your invention has a unique visual appearance then you can consider a design patent.
To be eligible for patent protection for your software, your invention needs to meet several criteria like being useful, novel, and non-obvious. The explanations of the criteria for a patent application are complex and complicated. We recommend that you contact an intellectual property specialist who is familiar with both technical and legal matters if you believe a patent makes sense for your invention.
A trade secret is any formula, pattern, device, process, or mechanism that is not generally known or discoverable by others that have commercial value. It is maintained as a secret by its owners and if it were revealed, would give its competitors an advantage.
A trade secret is protected without any formal registration and can last forever as long as its owners use reasonable efforts to keep it a secret and someone doesn’t independently discover it.
Whereas a copyright or patent can be infringed upon, trade secrets are subject to theft.
A trademark is a word, phrase, symbol or design – or any combination of these things that identifies the source of goods of one party from another.
With regards to creating a new software product, it is important to research your company’s or product’s name, logo, design, etc. to see if it might be infringing on someone else’s trademark.
Out of the gate, it is more likely that you will infringe on someone else’s trademark than it is that they will infringe on yours. By researching ahead of time, you can know up front rather than later so you don’t have to re-brand and market your application after the fact.
Once you have done the research, you may decide to register trademarks for your own company or product.
Creating a new software product is exciting. If you are concerned about protecting your idea during and after your product creation, consult with an expert in intellectual property that is familiar with technology who can advise you.
This article’s aim is to give you the background you need on what your legal options are to help you frame your conversation.
Before you get started in developing your software app, your thoughts and ideas should be clarified and written down so they can be consistently and easily shared and understood. To help you get started on the right foot, we have created a checklist.
You can grab a copy of that checklist below and share it with your team!