All Together Now: Highlights from the First Innovator Diversity Pilots Conference

Guest Post by Margo A. Bagley, Asa Griggs Candler Professor of Law, Emory University School of Law, co-inventor, and Principal, Diversity Pilots Initiative. Watch her video for Invent Together, entitled Challenges Encountered as a Diverse Inventor.

This post is part of a series by the Diversity Pilots Initiative, which advances inclusive innovation through rigorous research. The first blog in the series is here, and resources from the first conference of the initiative are available here.

In addition to being Associate Dean for Research and Asa Griggs Candler Professor of Law at Emory University School of Law, I am an African-American woman, co-inventor on two patents, patent attorney and law professor, author of numerous articles, chapters, and books on patent law, and advisor on patent issues to governments and international organizations. And yet, it is my firsthand experience, as a member of groups that have been systematically underrepresented and overlooked in the innovation ecosystem, that gives me a deep understanding and resolve to champion diversity and inclusion in innovation and led me to co-organize, with Professor Colleen Chien and personnel from the USPTO, the first Innovator Diversity Pilots conference held at Santa Clara Law School on November 18, 2022. (video recordings and slides available here.) This blog post, and others to follow in the series, will highlight practices that have been or will be tried, tested and evaluated to increase diversity in innovation. 

Are NDAs unenforceable when they protect more than trade secrets?

Are NDAs unenforceable when they protect more than trade secrets? The standard answer is no. NDAs can prevent disclosure of contractually-defined "confidential" information that is shared in the course of a confidential relationship, even if it is not technically a trade secret. NDAs can, in other words, go beyond trade secrecy.  

NDAs have also not traditionally been treated as contracts in restraint of trade, like noncompetes are. An NDA's purpose is, ostensibly, just to protect secrets. Similar to trade secret law, NDAs only prevent an employee from disclosing (and using outside authorization) specifically-defined information. They don't prohibit competition per se. NDAs are thus seen as comparatively "narrow restraints" which, all else being equal, should be preferred to noncompetes.

Or at least that is the common wisdom.  Although there is some support for this viewpoint in treatises and judicial dicta, our new article, Beyond Trade Secrecy: Confidentiality Agreements That Act Like Noncompetes, shows that a growing contingent of courts across jurisdictions are finding NDAs in employment agreements to be unenforceable when they reach too far beyond trade secrecy.  Even Google's NDA was recently found unenforceable by a California court, because it did not make sure employees could use or share skills they learned at Google with prospective employers. (That said, the Google opinion is quite extreme, even compared to others we reviewed. See pp. 8-11 of the opinion,  Doe v. Google, Inc., Case No. CGC-16-556034 (Cal. Super. Ct., Cty. of San Francisco, Jan. 13, 2022)).

The article is available on SSRN and is forthcoming in Yale Law Journal. It is co-authored by me and Chris Seaman.  This blog post is cross- posted on Patently-O  

Too Much of a Good Thing: Jake Linford on Copyright & Attention Scarcity

In his fascinating 2020 article in Cardozo Law Review, entitled Copyright and Attention Scarcity, Jake Linford provided a new justification for copyright law's barriers against derivative content—saving the overtaxed attention spans of copyrights' beleaguered audience. If readers and viewers got as much unauthorized derivative works as they wanted, Linford suggested, they would be unable to find the time and energy to read, watch, and sort through all of the derivatives available to them.  By giving original authors the right to control derivative works, copyright law protects the audience from content overload.  

I loved the article and really appreciated Linford's creative use of the literature on "attention scarcity." That said,  as a viewer and reader, I am not sure I like where the thesis leaves me. Speaking for myself, when I am tired and overloaded, the last thing I want is more originals. I want to return to my old favorites through a new lens; I want a sequel, a prequel, or a re-make. Whether these derivatives are authorized or un-authorized matters less to me than whether they are familiar and easy to get into without a lot of legwork. (I do want to know whether the content is made by or authorized by the original creator. But trademark law protects consumers from being misled as to source. Thanks to trademark law, I would know when the newest Star Wars is authorized by Disney and when it's not.)

I am about three years behind with this post.  My excuse, besides the pandemic, is that I felt it necessary to watch all seasons of Cobra Kai, along with the films in the original Karate Kid franchise, plus the entire library of Disney Plus, to fully research a response.

Lemley & McKenna: Trademark Spaces

Where a trademark is located matters. Some physical spaces on products are more likely to contain trademarks. Some obvious examples are the left breast of a t-shirt, the side or tongue of a sneaker, or the label on the front of a food container.  Consumers are more likely to find trademarks located in those spaces, and they are probably more likely to perceive features as trademarks if they are in those locations.

In their fascinating new article, Trademark Spaces and Trademark Law’s Secret Step Zero, Mark Lemley and Mark McKenna draw out the relevance of physical space for trademark protection, and in particular for non-verbal marks like logos and trade dress.  The authors argue that where a trademark is located determines how the law currently treats it, but that this is currently done by judges and trademark examiners as a "secret step zero." They think this is not ideal. Consideration of trademark spaces should instead be both more explicit and better thought-out. 

The article is now published in the Stanford Law Review (and posted here on SSRN).

Gersen & Hemphill: What's in a Bottle?

What's in a bottle?  If the bottle in question is shown below, the answer is protected trade dress. The Coca-Cola Company presently maintains several active registrations for many of its bottle shapes. See, e.g., Trademark Reg. No.'s 696147, 4242307, 4200433.

These registrations serve as "prima facie evidence" of, among other things, The Coca-Cola Company's "exclusive right to use the registered [trade dress] in commerce on or in connection with the goods or services specified in the registration[,]" subject to defenses such as abandonment, descriptive fair use, and functionality. Other sellers that use a confusingly similar bottle shape without authorization from The Coca-Cola Company could be sued under the Lanham Act, § 32 or § 43, even if they don't use the well-known Coca-Cola names or color schemes. That is what trade dress protection can accomplish.

In their fascinating new essay, "The Coca-Cola Bottle: A Fragile Vessel for Building a Brand," which is forthcoming in Legal Applications of Marketing Theory (Gersen & Steckel, eds), Jacob Gersen and Scott Hemphill tell the history of how The Coca-Cola Company (hereafter "Coke") secured lock-tight trade dress protection in the distinctive shapes of its bottles. The authors also previously authored a book chapter on the Coke bottle for A History of Intellectual Property in 50 Objects, edited by Claudy Op den Kamp and Dan Hunter.  

Digging into historical documents — including settlement agreements resulting from litigation that Coke brought against other sellers — the authors argue that the company's trajectory towards trade dress protection for the famous Coca-Cola bottle was not as smooth as we might think. In the authors' words, it was "fragile and contingent." (2). They reveal many reasons things might have come out differently for Coke.  

I won't summarize the whole essay here, because it's short and very fun to read. But I want to draw out what I see as one of the authors' most important insights. They show that Coke secured common law trade dress protection by initially using design patent law. They argue that, under contemporary legal principles, courts might have rejected this strategy and not permitted Coke to use unfair competition law to protect its bottle shapes following the expiration of Coke's design patents. This is, after all, what the Supreme Court did in 1938 when it did not let Nabisco stop other sellers from using the "pillow shape" of Nabisco's shredded wheat cereal following expiration of Nabisco's patents.  Things did not come out that way. Coke's strategy was a winner. But the authors suggest things could have gone very differently. 

Morten Follow-Up: What Do Federal Agencies' Enabling Statutes Say About Their Power to Disclose Trade Secrets?

In my prior post I interviewed  Christopher Morten at Columbia Law School about his article "Publicizing Corporate Secrets," which is forthcoming in University of Pennsylvania Law Review.  Morten argues that federal agencies have much more power to publicly disclose trade secrets and confidential information collected from private companies than is commonly believed. He argues that sometimes agencies do have the authority to "break" corporate secrets, and sometimes they do not. His core insight is that ultimately it's the agencies' enabling statutes passed by Congress that dictate their power to disclose trade secrets and confidential information.  I will now post links and our discussion of the full text of some of these enabling statutes, so that readers can see the statutes and make their own interpretations.

Christopher Morten: Do Federal Agencies Have More Power To "Break" Corporate Secrets Than We Thought?

The prevailing wisdom is that federal agencies cannot generally disclose trade secrets and confidential information given to them in confidence by companies that they regulate or work with.  Indeed, the Trade Secrets Act (18 U.S.C. § 1905), passed in 1948, seems on its face to make it a crime for federal government personnel to do so.

However, in a highly provocative, but ultimately compelling article, "Publicizing Corporate Secrets," forthcoming in the University of Pennsylvania Law Review, Christopher Morten of Columbia Law School argues that federal agencies have much more power to publicly disclose trade secrets than is commonly believed. Morten argues that the scope of agencies' power to disclose is defined by their enabling statutes and that, with many important exceptions, several of these enabling statutes do not, at a legislative level, prohibit disclosure of trade secrets or confidential information. Some agencies may have regulations on the books preventing disclosure of trade secrets, but he suggests that they could in some cases change those regulations without additional authorization from Congress, and that there would be far fewer negative consequences for them than we might think if they did so.  

On a very hot day in July, I interviewed Morten about the details of his argument.  The interview took place in the air-conditioned NYU Engelberg Center. Many thanks to Katrina Southerland and Mike Weinberg for arranging a space for us.  This was a fascinating, lengthy discussion, which I have excerpted below.  

20 Years of Trade Secrets Scholarship

Professor Sharon Sandeen, at Mitchell Hamline School of Law, has posted an ongoing bibliography of trade secrets scholarship. It is pretty amazing. It includes books, book chapters, law review articles, and non-law review articles such as blog posts.  It contains links for many of the documents and complete citations. The bibliography looks only at relatively modern sources, from 2002-2022. Other major sources for trade secret law and scholarship include statutes and legislative history (e.g. UTSA Commentary, DTSA Senate and House Reports) as well as many excellent treatises available through Westlaw or Lexis, including Milgrim & Bensen, Jager, and Quinto et al.  (There's also a Pooley treatise, though the author has other publications that are more easily accessible.)

Professor Sandeen produced this  bibliography with the help of Mitchell Hamline students Arneda Perkins and Amy Gustafson, and Mitchell Hamline research librarian Alisha Hennen. 

What does ending the COVID-19 pandemic mean from a legal perspective?

By Lisa Larrimore Ouellette, Nicholson Price, Rachel Sachs, and Jacob S. Sherkow

The COVID-19 pandemic isn’t over. The United States is averaging around 100,000 new cases per day and recently marked 1 million total deaths, and global deaths associated with the pandemic are estimated at nearly 15 million. But the U.S. legal response to the pandemic appears to be winding down, with mask mandates disappearing, an uncertain congressional response, COVID relief money running out, the end of most emergency orders at the state level, and calls for an end to federal emergency declarations. In this post, we examine COVID-related public health emergency declarations, what ending those would mean from a legal perspective, and what impact that would have on pandemic innovation policy, including access to existing COVID innovations and incentives to develop new ones.

What are the major COVID-19 emergency declarations?

Broadly speaking, public health emergency declarations give governments the power to “activate funds, personnel, and material and change the legal landscape to aid in the response to a public health threat,” generally in a manner legally different from typical law- or rule-making processes. Because public health measures often are (and need to be) wide-ranging, federal, state, tribal, and local governments all have the power to issue such declarations. And even within a given government authority, individual agencies often possess complementary but different powers to issue their own public health emergency declarations. COVID-19 has consequently prompted a large number of distinct emergency declarations, each with different legal effects.

How do we encourage innovation on “long COVID”?

By Jacob S. Sherkow, Lisa Larrimore Ouellette, Nicholson Price, and Rachel Sachs

Since the pandemic began, numerous recovered COVID-19 patients have reported having “long COVID”: COVID-19 symptoms persisting well beyond the underlying viral infection period. Whether such a condition is specific to COVID-19, or more generally a form of “post-acute sequelae”—or even a discernable condition—has bedeviled scientists and clinicians alike. The fact remains, though, that likely millions of people in the U.S. alone will continue to report a variety of challenging symptoms more than 6 months after they’re infected. Despite this magnitude of reports, confusion regarding defining the condition and identifying its etiological basis has presented significant challenges to innovating treatments for it. In this post, we explore some of the current evidence surrounding “long COVID,” some of the difficulties in developing long COVID treatments, and how policymakers can move things along.

Motorola v. Hytera: Why Might Government Bring a Criminal Trade Secrets Case After a Successful Civil One?

A federal indictment was unsealed yesterday in the Northern District of Illinois, charging Hytera, a Chinese maker of radio transceivers and radio systems, with conspiracy to commit theft of trade secrets under the Economic Espionage Act. The indictment alleges that Hytera conspired with former employees of Motorola, who were working for Motorola Malaysia at the time, to steal digital mobile radio (DMR) technology developed by Motorola.  The indictment brings criminal trade secrets claims under various provisions of 18 U.S.C. § 1832, including Sections 1832(a)(2) (copies, communicates, downloads, etc.), (a)(3) (possession), 1832(a)(4) (attempt), and 1832(a)(5) (conspiracy).

It is not necessarily uncommon for the government to bring a criminal case after a civil case.  Recall in the Waymo v. Uber case, the judge in the civil case actually referred the case to the US Attorney for investigation, and he did so very early in the case, a long time before the actual trial.  Sometimes the civil plaintiff can even lose or settle the civil case, and the government still brings the criminal case anyway. That happened to Anthony Levandowski in the Uber/Wayo dispute. He was indicted and convicted, even after the companies settled the civil case.  (Trump pardoned him).

But here, Motorola had a very big win in the civil case. The Illinois district court case (Judge Norgle presiding) was decided after a full jury trial. Motorola won a massive verdict of over $700M in damages, more than half of which were punitive. See Motorola Sols., Inc. v. Hytera Commc'ns Corp., 495 F. Supp. 3d 687, 695 (N.D. Ill. 2020). (This was thereafter reduced by ~ $200M).

One might think: "isn't that enough?" Why should the government bother to pursue a criminal claim now? I will not dwell here on the obvious political motive: "We think China is stealing US trade secrets and we need to make an example of them..." even if that is probably there.  I'll put that hot potato aside and instead highlight several practical reasons why the government might be getting involved after the victorious civil case.

What are the challenges in developing information around mixing-and-matching COVID-19 vaccines and therapies?

By Rachel Sachs, Jacob S. Sherkow, Lisa Larrimore Ouellette, and Nicholson Price

The FDA has now authorized three vaccines and several treatments (including both monoclonal antibodies and small-molecule drugs) for the prevention and treatment of COVID-19. But the initial evidence supporting these products’ introduction into the market did not include information about how they might work together. Nevertheless, information about mixing-and-matching COVID-19 vaccines and therapies would be highly valuable not only to physicians and their patients, who must already make decisions about what treatment options to pursue under conditions of uncertainty (if the treatments are available), but also for policymakers, who want to know what products to prioritize for investment. Why is it so difficult to obtain this information? How can policymakers encourage its development? 

Jessica Litman: Who Cares What Edward Rogers Thought About Trademark Law?

Professor Jessica Litman has a fascinating forthcoming book chapter on the history of the Lanham Act and the influence of Edward S. Rogers, "Edward S. Rogers, the Lanham Act, and the Common Law. " Litman tells the history of the drafting of the Lanham Act of 1946 through the lens of Edward S. Rogers, detailing how his advocacy and drafting work influenced the final statutory text. 

Readers may be surprised to learn that Litman started research on the topic as a law student in the 1980s, while writing a student note on trade dress infringement. She went into the stacks of the Columbia Law Library and started reading bound copies of legislative history. She noticed it seemed like Rogers was everywhere, from 1932 all that way up to 1946, and that the chairs of the committees were deferring to him.  That was really interesting, she thought.  But after the note was done, she kind of forgot about it.

Now, forty years later, Litman is a professor at the very institution Rogers attended, the University of Michigan. She was surprised to find no one seemed to remember Rogers had been at Michigan, even though he "earned three law degrees and was a member of the adjunct faculty for 18 years" (3). In this book chapter, Litman is making up for that, returning to the topic of Rogers and his legacy. She's found her notes from 1981. She's read everything he wrote, and all his cases, starting in 1895 all the way until his death in 1949.

The result is a remarkably personal history of Rogers' involvement in the development of trademark law, full of contemporary details and selected quotes from Rogers' own writings. Litman's chapter, which engages extensively with the secondary literature as well as the primary sources, adds a tremendous amount to this history and to the many excellent recent articles touching on this subject, including The Lost Unfair Competition Law by Christine Haight Farley, The Erie/Sears/Compco Squeeze: Erie's Effects Upon Unfair Competition and Trade Secret Law by Sharon Sandeen, In the Shadow of the Trade-Mark Cases: The 1881 Trademark Act and the Supreme Court by Zvi Rosen, Mark McKenna's book chapter, Trademark Law's Faux Federalism, and many others.

My interview with Litman is transcribed in this post. The interview significantly deepened my knowledge of the subject and I am excited to share it with readers.

How does pregnancy factor into COVID-19 innovation?

By Nicholson Price, Rachel Sachs, Jacob S. Sherkow, and Lisa Larrimore Ouellette

Pregnant people are at increased risk of severe illness from COVID-19, but they have been largely excluded from clinical trials, the process of testing vaccines’ and treatments’ safety and efficacy. They’re consequently left in a bind: there’s not great evidence about the safety and efficacy of products they can take to be safe from COVID-19. This lack of information might be part of the explanation for low vaccine uptake among pregnant people, particularly women of color. And while this lack of data isn’t particularly novel with respect to drug development, generally—we’re historically bad at generating robust safety data for pregnant people—failing to do so for COVID-19 seems to have outsized public health consequences. What’s behind this ongoing exclusion? And how should policymakers consider including pregnant people in COVID-19 clinical trials and beyond?

Molnupiravir may become the first COVID-19 pill. What took so long?

By Lisa Larrimore Ouellette, Nicholson Price, Rachel Sachs, and Jacob S. Sherkow

On October 1, the developers of the COVID-19 antiviral molnupiravir issued a press release announcing positive Phase 3 clinical trial results, with a 50% reduction in the risk of hospitalization or death. On November 4, the UK’s Medicines and Healthcare products Regulatory Agency authorized molnupiravir for use in the UK. While the results have yet to be reviewed by a scientific journal, they have generated excitement not only because of the potential lives saved but also because molnupiravir can be taken orally in tablet form, greatly reducing the difficulty and cost of administration. (Monoclonal antibodies require intravenous administration, as do the less promising treatments remdesivir and plasma therapy.) While it remains to be seen whether molnupiravir is as effective a weapon as its namesake Mjölnir (Thor’s hammer), the news so far is promising. But why, in a global pandemic where vaccines could be pushed through in record-breaking time, were new treatments like molnupiravir so much slower to find? (It’s worth noting that molnupiravir isn’t the only drug in this situation; as this post was going to press on November 5, Pfizer announced that its experimental antiviral, Paxlovid, reduced COVID-19-related hospital admissions for high-risk adults by 89%.)

In this post, we explore the role of innovation policy in molnupiravir’s development, the FDA’s role in balancing access to promising treatments with the need to generate evidence of their efficacy, questions about molnupiravir access, and the implications for antiviral innovation going forward, for COVID-19 and beyond.