The problem being solved: Historically, federal agencies have relied on the patent system to protect their inventions. But patenting has some downsides. It can cost thousands or tens of thousands of dollars to prepare, prosecute and maintain a single patent. And getting a patent is a slow process, taking an average of two years from filing to issuance. Patents must also be available to the public which is a concern for some federal agencies because our adversaries could gain access to details about the technology, allowing them to make and use the invention themselves. Trade secret law offers a less expensive, more efficient and more secure alternative to patent protection, but has not been commonly used by the government other than for software. 

The solution: An in-depth analysis by legal experts from the Naval Research Laboratory and the Office of Naval Research concluded that federal laboratories are authorized under existing law (35 USC 207) to use trade secret protection for government inventions beyond those involving software and still be compliant with the mandates for technology transfer. NRL technology transfer experts then worked with the legal team to build a trade secret licensing program and developed mechanisms to ensure the program’s sustainability. NRL created a “Notice of Trade Secret Status” form to be signed by anyone with access to the trade secret, including prospective licensees, to show that NRL had taken reasonable measures to maintain secrecy. The lab also reworked the standard Navy license agreement template to specifically address trade secret considerations—balancing the need for intellectual property protection against the need to attract collaborators for commercialization. 

The impact: The first NRL invention to be designated as a trade secret under 35 USC 207 was also the focus of its first trade secret license, which was executed in December 2021 with the State University of New York Research Foundation. The organization licensed the technology to support its efforts to improve domestic production of photonic integrated circuits (microchip-based circuits that use light to transmit information), which currently must be sourced from overseas. NRL’s technology involved optical components—tiny structures that are not apparent to someone using the larger product, which makes them ideal for trade secret protection. The licensing effort encompassed 27 different inventions, for which patent protection could have cost as much as $540,000 if separate applications had been required for each one—money that would have been difficult for the lab to recover through licensing revenues.  

NRL’s trade secret licensing program is a potential model for other federal technology transfer offices; at the time of this award submission, the lab had shared its findings and approach with labs from the Department of Veterans Affairs, the National Aeronautics and Space Administration, and multiple agencies in the intelligence community. The approach offers a path by which federal technology can become part of the national economy more efficiently, while saving the government money and protecting sensitive innovations from adversaries.