What can I do if a company uses my idea without permission?

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Question:

I gave a company an idea in writing. It said it was not interested. Then it ended up making a similar product -- some minor changes, same name -- and selling it in many stores. What can I do?

Answer:

What happens next depends on two things: (1) whether the idea is protectible, and (2) what the arrangement was between you and the company when you disclosed the idea.

First things first. Generally an idea, by itself, is not protectible. For example, an idea to protect a car by locking a metal bar to the steering wheel is not protectible. But that same idea, when expressed in a drawing or prototype that demonstrates the unique way this invention works, may be protectible under patent laws. Likewise, an idea to create characters that transform into superheroes is not protectible, but the same idea as graphically depicted in the Mighty Morphin Power Rangers is protectible under copyright law. Therefore, you must determine if you expressed the idea in a manner that is protectible.

If your expression of the idea is protectible, then you must also discern how similar your work and the company's work truly are. As a very general rule, the analysis focuses on whether the two works are "substantially" similar.

Second, you need to analyze the conditions under which you disclosed the idea. Many artists and inventors use a written nondisclosure agreement. That protects the disclosure of any secret ideas from unauthorized use. If you signed such an agreement, you can examine it to determine your remedies.

If you did not sign a nondisclosure agreement (and your idea is not protected under intellectual property laws), you still may be able to argue that a confidential agreement was implied if:

  • the company solicited the idea from you -- that is, you sent the information in response to its prompting
  • you indicated that the invention was a business proposition -- you hoped for payment
  • at the time of disclosure, you requested that the information be kept secret, and
  • the information is a trade secret -- that is, it has commercial value and is not known by competitors.

Although a confidential relationship can be implied, that is always more difficult to prove than showing a relationship based upon a written nondisclosure agreement.

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