OMI alleges it shared confidential/proprietary information with Boston Scientific under a Confidential Disclosure Agreement (CDA), hoping to enter into some kind of business arrangement (license agreement) with BSX. Obviously, the deal never materialized for OMI. What happened next? According to OMI Boston Scientific took some pictures of OMI’s stent. Aftwards, BSX inventors added some figures to a BSX patent application. OMI alleges that these figures were derived from the pictures. OMI also alleges that the BSX inventors included other information disclosed by OMI to BSX.
Regardless of whether OMI’s allegations have merit, this case serves as an excellent reminder to all dealmakers, managers, and attorneys of the danger of “contamination” when entering a CDA with a company working in an area related to the company’s internal research programs. Whenever this happens there is a potential for a similar suit that may cost a lot unless the company ensures that proper protections are in place against contamination (or the appearance/likelihood of contamination).
If the technology is really a BSX invention BSX should be able, or at least could have been able, to protect itself. For example, BSX could have taken steps to memorialize its possession of the technology that was added to the patent prior to entering into the OMI deal. BSX also could have insisted on mechanisms for limiting the scope of confidential information (CI) in the CDA (e.g., requiring OMI to memorialize any oral disclosures). Advance filing of provisional patent applications prior to entering into such a CDA is a simple strategy that can provide advantageous protection against such problems. Finally, skipping over the CDA stage by (1) doing as much public due diligence as possible and/or (2) directly entering into an agreement that grants an option, license, provisions for IP ownership, or research collaboration often helps (rather than allowing employees to disclose unlimited amounts of information under a CDA). Training is also critical; particularly for scientists and technicians who are too often unaware of “contamination” risks.
IP Deals 