I  love sushi, especially when it comes with a large heap of wasabi. What, you may ask, does this have to do with chemistry? Well, not much actually, although I guess you could consider the green paste that we generally call “wasabi” a chemical composition. It wasn’t until much later in life that I realized that what we know as wasabi here in North America is just a simple mixture of dried horseradish and green food colouring. A few years ago, I found some real wasabi at a local fish market. As is often the case in life, real wasabi is considerably better than the fake, although it was quite expensive for just a small portion. It was with some interest then that I read a newspaper article about a company in British Columbia, Pacific Coast Wasabi, which is growing the Japanese root on Vancouver Island. Evidently, wasabi is a very difficult crop to grow, which explains the scarcity and high cost of the root. Not surprisingly, the company appears to have invested a significant amount of time and money in developing the process, thus enabling them to grow the finicky crop. Interestingly, from an intellectual property perspective, the article also mentions that the company decided not to pursue patent protection and has decided to simply keep the process secret.

Trade secrets are another form of intellectual property that can be quite valuable. Most everyone knows that the Coca-Cola Company vigorously protects the secret recipe that is the Coca-Cola formula, now held in a secure vault in a museum in Atlanta. Apart from food recipes, trade secrets are often used to protect technological information. While patent protection is most often associated with scientific or technological advancement, in certain situations, trade secrets can be an important form of intellectual property protection for such information. As defined in law, a trade secret is some piece of information that provides an economic advantage to a business or person and, by its very definition, must be kept secret. Unlike patent protection, a trade secret is not registered with a government body (like the Canadian Intellectual Property Office) but simply kept as a secret within an organization. If the above two requirements for protection are met, a person who wrongly discloses a trade secret can be held liable by a court for damages that occur as a result of the disclosure. 

As I have mentioned before, an inventor is provided a 20-year monopoly to exploit an invention. In return for this monopoly, the inventor must fully disclose what the invention is and how it works. In contrast, trade secret protection can last indefinitely, so long as the information is kept secret and provides an economic advantage. This begs the question: if trade secret protection can last indefinitely and there is no need to register the secret (and therefore incur the costs involved with patent protection), why not forego patent protection and just keep everything a secret? Of course, there are disadvantages to trade secret protection. For example, once a secret becomes public, protection is lost, irrespective of whether the disclosure of the information was by accident, inadvertence, or intentional.

For certain information, trade secret protection is a good option for protecting that information. For Pacific Coast Wasabi, keeping their agricultural process secret allows them to control who uses their process to grow wasabi. If the company had patented their process, thereby disclosing their technology, it could be difficult to determine whether a farm in a far-away location was infringing their patent. While trade secret protection can be valuable for certain information, they don’t offer much protection for products, unless the product is a complex composition like the Coca-Cola formula. A drug company could never protect a small molecule pharmaceutical using a trade secret, as the identity of the molecule is easily discoverable using today’s technology.    

In the appropriate situation, trade secrets can be quite valuable for protecting an organization’s industrial processes, internal know-how and knowledge in any business. However, by its very definition, the information must be kept secret — once the cat is out of the bag, the protection is lost. 

Mike Fenwick is a patent lawyer with Bereskin and Parr LLP in Toronto and holds a master’s degree in organic chemistry.