Entrepreneurs are excited about their technology and willing to engage in discussions with great enthusiasm. This is even more the case with the scientist turned entrepreneur. Scientists and entrepreneurs must engage in collaborative efforts to advance their programs. Such engagements often lead to mixing of ideas and advancement of the technology and funding. Government grants often encourage collaborative efforts. Collaboration is very good and should be encouraged. However, when the technology resides in a company with the purpose of creating products greater care is required. Take for example this summary of a true story.
A few years ago, a group of scientists traveled to a highly prestigious university in Boston. They were meeting with a world-renowned professor and physician to discuss possible collaborative efforts. The company scientist engaged in an open exchange of ideas and discussed their technology in depth. They sought to develop a highly beneficial collaboration around their exciting technology.
Several months after the initial meeting and engaging in the collaboration, the company offered a permanent position to the university professor. The professor accepted and moved full-time to work for the company. The professor hired a team to support his efforts in the company. The company leased a facility to accommodate the new team, as they were all located in New England.
Both parties were not aware that separate patents filed to cover the technology; one by the company and one by the university on behalf of the professor. Neither the company nor the university was aware of the independent filings. All filings took place before the professor joined the company. It was about a year later that the two parties discovered the conflicting filings during a team meeting at the company. The result was a significant battle for ownership that took legal action and lots of money to resolve. Anger and disruption of all company activities continued for a few years!
The situation described by this story shows how an energetic discussion by parties not working under a formal agreement can result in simultaneous discovery and filing of the same invention. The same idea generated by both parties arose because of an extensive discussion of the background discussions and concepts. You should never be surprised when a conversation with a party results in their determining the next steps to create a new product. Smart people often see the same opportunities once the basic facts are known.
The idea that you feel protected by confidentiality or patent filings is helpful, but only to the extent you can defend your position in court. This takes lots of money, something startups do not have. The financial costs are staggering and the lost time and dilution of your energies are significant. The point of this extended discussion is to alert you of an old saying; “loose lips sink ships” translated this means “beware of unguarded talk.”
Collaboration should be encouraged. Combined efforts often solve problems differently and more creatively. The concerns you should have are identifying a means of collaborating without giving your ideas or technology away. Some type of agreement verbal or written helps prevent conflicts. Confidentiality agreements should be backed-up with documentation of which group came up with what ideas or what topics were presented to the other side. Record keeping is critical in case of future conflict.
Conflict will always arise when people think there is big money on the table; you can count on it. Projected sales of hundreds of million or billions of dollars bring claims by patent trolls and groups with legitimate claims of ownership. Your best efforts may never prevent the legal conflicts. However, you can attempt to better protect your ideas, develop appropriate sharing arrangements, and keep a log of discussions in an effort to protect your company in the future.
You can follow Taffy Williams on Twitter by @twilli2861 and you can email him with questions at firstname.lastname@example.org or contact him via company contact info in the website. More Startup information is contained in his personal blog.