4.2 TRADE SECRETS
Trade secrets are confidential formulas, practices, and know-how that are protected only by their secrecy and that give the trade secret holder a competitive advantage. They can be disclosed to others under confidentiality agreements (see Section 11.2.1.3). From a practical standpoint, trade secrets are the opposite of patents in that patents require complete disclosure of the nature of the invention and how it was made, but they guarantee protection for a limited period of time. Trade secrets can potentially last forever, but there is no guarantee of protection. Trade secrets work best if the secret is known by only a few persons, cannot be reverse engineered, and is unlikely to be independently developed by other companies. Trade secrets are broader than patents and can be used to protect things that would not be patentable. Examples of trade secrets are a chemical manufacturing process, Google's search algorithm and the recipe used to make Coca-Cola.
Trade secret owners can sell or license their secrets to others by contract. Courts offer some legal protection for secrets that are valuable, kept secret through reasonable precautions, and stolen by a competitor using illegal methods.
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