A patent or invention non-disclosure agreement (NDA) is a legally binding document designed to protect an inventor’s intellectual property rights when sharing confidential information about their invention with third parties. It is essential for inventors who want to safeguard their creative work and prevent unauthorized disclosure of their invention’s details.
This unilateral agreement outlines the terms and conditions for sharing confidential information about the invention. It ensures that the recipient will not disclose the information to any third party or use it for any purpose other than the intended purpose. The agreement also specifies the consequences of any unauthorized disclosure.
Patent Definition & Tools
A patent is a right granted by a regulating body to an inventor, allowing the inventor the sole authority to distribute, sell, make, and use an invention for a certain period. In the US, patents can be valid for up to 20 years.
To receive this exclusivity, the inventor must publicly divulge all the invention’s details. This aspect of a patent gives others the opportunity to learn from the inventor’s ideas upon the patent’s expiration.
Use these resources to apply for a patent or research existing ones:
- United States Patent and Trademark Office: Apply for a patent.
- Google Patents: Search for an existing patent.
When to Use a Patent Non-Disclosure Agreement
A patent NDA isn’t to prevent the disclosure of a patent; instead, it prevents another party from revealing confidential discussions about an in-progress invention, pending patent, or patent application. It also prevents an outside party from using private information to replicate your invention and benefit from it themselves.
Here are some specific instances when you can use a patent NDA:
- Before Filing a Patent Application: Share the invention with potential partners or advisors so you can collaborate on the invention. You may also use an NDA to discuss strategies that could form the basis of a patent application.
- While Waiting for Patent Approval: Discuss details of an undecided patent application with pertinent parties without fear of compromising the information.
- When Seeking Funds for Your Invention: Inspire confidence in your invention with potential investors by sharing specific technical details. These details could be the push they need to contribute to your ventures.
- When Working with Manufacturers: Manufacturers may need access to private invention details to properly produce prototypes.
- Hiring Employees: You may implement a patent NDA for employees who will work on the invention in its early stages.
- Interactions with Patent Examiners or Consultants: If you consult with outside experts to gain insight into an invention’s technical aspects, you may have them sign a patent NDA.
Limitations of a Patent NDA
Patent NDAs can be helpful during the invention process by preventing non-confidential disclosures of your invention. Without this protection, a public disclosure could occur, potentially disqualifying your invention from patent eligibility.
However, NDAs also have limitations. For example, it can be challenging to prove that an information leak began with the recipient who signed the NDA. The recipient may mention your invention offhandedly to their neighbor, and the neighbor could share it with a handful of other people. This progression could make it nearly impossible to prove that the leak began with the recipient.
Even if you do track the progression successfully, it can be difficult to prove that the person didn’t arrive at the same idea as you independently. Furthermore, an NDA won’t help you when you go to the patent office to try to file a patent if someone else has already done so before you. The patent office operates on a first-to-file system, meaning it doesn’t consider who thought of the idea first.
Solution to Patent NDAs' Limitations
While a patent NDA can be a supplementary tool, it shouldn’t be your only safeguard against intellectual property theft. Ideally, you should consult a patent attorney who can help you file a patent application. The attorney will be bound to secrecy by attorney-client privilege, which can limit the leakage of confidential information.
You can still use a patent NDA to discuss your invention and allow other people to work on it, but working with a patent attorney is your best bet for securing a patent without interruptions.
How to Write a Patent Non-Disclosure Agreement
Step 1 – Identify the parties involved in the agreement, including the inventor and the recipient of the confidential information.
Step 2 – Define the agreement’s purpose, including the specific invention or confidential information about the pending patent that will be shared.
Step 3 – Determine when the NDA will expire, which could be anywhere from a few months to a few years from the start date.
Step 4 – Carefully outline what information is considered confidential and what isn’t. This can include drawings, prototypes, and other information about the invention.
Step 5 – Specify what information is excluded from the terms of the agreement, such as information that is already known to the recipient or is in the public domain.
Step 6 – Identify the consequences of any unauthorized disclosure or breach of the agreement, including any legal remedies that may be pursued.
Step 7 – Acquire both parties’ signatures to make the patent NDA legally binding.
Patent Non-Disclosure Agreement Sample
Download a patent non-disclosure agreement template in PDF or Word format below:
