Patents vs. Trade Secrets. Pick a lane.
When it comes to protecting intellectual property, lawyers can plead in the alternative. But businesses cannot operate in the alternative on the same information. International Medical Devices, Inc. v. Cornell, 2025-1580, 2025-1605 (Fed. Cir. Apr. 17, 2026), illustrates the point.
The Verdict That Didn’t Last
The plaintiff won a substantial judgment at trial, about $17 to $18 million. The core of the case was trade secret misappropriation concerning the Penuma® implant. Plaintiff claimed it shared confidential know-how with the defendant, subject to a non-disclosure agreement (NDA), which the defendant then used without permission.
On appeal, the Federal Circuit focused on a more basic question. Was the information actually secret?
The answer was no.
Patents and trade secrets don’t mix well
The record showed that the supposed trade secrets were already disclosed in patents and other public materials. Patents are by definition public. The inventor makes a deal with the government. In exchange for sharing a detailed description of the invention with the public, the inventor gets exclusive rights to the invention for a period of time.
Sharing information publicly in a patent is, of course, the death of a trade secret claim. Once information is public, trade secret protection is gone.
So, the trade secret claim fell, and the claim based on breach of the NDA fell with it. The NDA excluded publicly known information, as most NDAs do. The damages award based on those theories fell, too, of course. Most of the judgment was reversed. We’ll get to the part of the judgment that remained in a minute.
Pick a lane
As noted, to obtain a patent, the inventor must explain and disclose the invention in to enjoy a limited period of exclusivity. Trade secret law works the other way. It depends on having information that is valuable because it is secret, and on keeping it secret.
You can’t have it both ways. Once the information about the invention is disclosed, whether in a patent or otherwise, it is no longer a trade secret.
This requires planning from the outset. Pick a lane and stick with it.
That’s easier said than done, and it has to be done long before trial or arbitration lawyers get involved. They can plead in the alternative, but it that does no good if the alternative is not viable because of decisions made before the lawyers were involved.
A hybrid lane might work
But let’s not overstate the point. Patents are not always fatal to trade secrets. It depends on what the patent reveals.
There can be trade secrets related to patented technology that are not disclosed in the patent. That’s why in Life Spine, Inc. v. Aegis Spine, Inc., 8 F.4th 531 (7th Cir. 2021), the plaintiff was able to enjoin use of the exact specifications for the involved product even though the device was patented. The patent did not include those details.
More and more, companies are adopting the strategy of patenting the basics of the invention but keeping some key technical details out of it. Historically, that strategy could lead to invalidating the patent for failure to reveal the best mode of practicing the invention. While there is still a best mode requirement, Congress dropped failure to reveal best mode as a way to invalidate patent in the America Invents Act in 2011. There could be an argument that deliberately and deceptively hiding an important part of the invention is inequitable conduct or the like. But as a practical matter, the best mode defense is not at all what it once was.
Still, this all suggests that careful planning and execution remain necessary when trying to achieve both patent and trade secret protection related to a given technology. There may be one lane for patents and another for trade secrets for the same technology, but you need to be very sure you understand which lane you are driving in for which part of the technology. If you drive in the wrong lane, your trial or arbitration lawyer won’t be able to save you.
Trademarks Are Different
One part of the case did survive. The court affirmed a trademark counterfeiting award based on use of the Penuma® mark. Trademark law protects source and prevents confusion. It does not depend on whether the underlying information is secret or other not.
So, when the secrecy-based claims failed, the trademark claim stayed. That is not a substitute for a a carefully planned strategy for protecting technology. But it shows the value of having different forms of intellectual property that protect different interests.