Who Owns Your Ideas? - Industry Trend or Event

Health Management Technology, July, 1999 by Leah Curtin, Roy Simpson

Does an employer own what's in your head--or only the fruit of your labors?

Who owns what's in your head? You? Or the employer on whose payroll you gained the opportunity, experience and knowledge to develop it? Today, these questions go beyond trade secrets, marketing plans and inventions. As the Information Age nudges physical capital aside for intellectual capital, businesses are taking aggressive action to protect their interest in what's in your head.

There are essentially four traditional types of intellectual property rights: patents, copyrights, trade secrets and trademarks. Each affords a different type of legal protection.

1. A patent is a 17-year exclusive monopoly on the right to make, use and sell a qualifying invention.

2 A copyright merely protects the form in which ideas are expressed.

3. A trademark protects the symbol or names used to distinguish products in the marketplace.

4. A trade secret is any formula, pattern, compound, device, process, tool or mechanism that is kept in secret and that gives its owner a competitive advantage.[1]

Buying and Selling Employees?

Today companies are moving beyond these traditional types of property rights-claiming ownership of ideas, intellectual information, experience, and knowledge. We may not be able to buy and sell human beings, but clearly employers are allowed to sell their employees "intellectual assets."

"Human capital acquisitions happen all the time. Cisco Systems Inc. in San Jose, CA, has made 19 of them--mostly acquisitions of small software companies with 50 to 100 employees, with no products on the market and not a dime of revenue. Yet for these batches of employees, Cisco paid premium prices--up to $2,000,000 per employee, [in another case] a Maryland company in Chapter 11 bankruptcy sold itself to Space Applications Corp. (SAC) in Virginia. The company's real assets were its 100 scientists. So it sold them. "[2]

Is this a modern day form of slavery? Our laws forbid the sale of your bodies, but not your minds? What would have happened if the employees jumped ship?

It Belongs to Them

Today, hospitals are competitive businesses--and they are changing everything from their patient care and information technologies to their forms of organization and education. Moreover, they often serve as "laboratories" where they test and evaluate innovative products. Were you involved in helping to design a software support system for case managers? Have you been part of a team that developed an innovative and successful care delivery system--one that consultants could sell to competitors?

As an inservice educator, did you develop educational materials that could be marketed outside the hospital? Did you participate in research--clinical or systems? If so, your employer owns it lock, stock and barrel.

Moreover, what you publish in professional journals belongs to them--or at least the words you write belong to the journal. Therefore, it behooves you to clear it with your employer if you intend to write about anything developed by or tested in the hospital. You might want to read each journal's copyright release form very carefully. I know for a fact that some journals actually lay claim not only to your words, but also to your work--and any future development of that work. The wording in the copyright release often converts your intellectual property into "work made for hire" even though you haven't earned a cent!

College Students' Ideas?

What may be more shocking is that colleges and universities may claim ownership of your ideas, too. A couple of years ago, an undergraduate student at a major Mid-western school was working his way through college as a janitor in the university computer lab. While he was cleaning the lab, he would occasionally chat with college professors, lab assistants, and graduate students who were working on a grant designed to explore solutions to a particularly vexing and costly infotech problem.

A computer science major himself, he asked the professor many questions over the course of a two-year period. When the grant expired before a solution was found, the university decided to drop the investigation. However, the janitor-cum-student was fascinated and determined.

He had made notes about his conversations with the professor, and copied various equations from the lab's black board. Whenever he found some spare time, he worked on the problem. Three years later-- Eureka!--he had the solution, which he planned to sell, even put out for bids, to interested technology firms.

The student was ecstatic, but not for long. The university claimed ownership of his work, and when he refused to turn it over, they sued him. A judge found in favor of the university and ordered him to turn over all his materials. He refused, claiming that he had destroyed them, and was sent to jail for contempt of court. Last I heard he was still there and still refusing to obey.

Even an Untested Idea

In 1997, DSC Communications Corporation fired Evan Brown, and then slapped him with a breech of contract suit for failing to disclose an idea he had about solving the Y2K problem. Brown thinks his idea would update old codes and make them usable on current and future systems.