I recently attended a great Intellectual Property seminar entitled “Risk Mitigation: Protecting Your Intellectual Property from Industrial Espionage” hosted by the Rhode Island Economic Development Corporation. The seminar was presented by Edward J. Barr, Esq. of Marip International LLC, a Massachusetts company that “provides comprehensive risk analysis, commercial intelligence, and global business development support services.” (From www.maripintl.com) As he told me, most of his clients are companies who have been the victim of “Economic Espionage”. Through seminars like the one I attended, he’s trying to reach out to companies before they become victims, and help them take a proactive approach to protecting their technology and secrets from competitors.
As an attorney who specializes in helping her clients minimize their Intellectual Property risk by maximizing their IP protection, I am more than happy to help spread the message. So, what is “Industrial Espionage” and why should American businesses care about it?
1. “James Bond” may actually be spying on your company. Industrial Espionage is basically companies spying on other companies in an effort to acquire any type of information that can provide them with some sort of economic benefit or advantage. The Economic Espionage Act of 1996 criminalizes such activity. The spies are usually looking for technology, but they can also be looking for pricing, research/test data, customer lists and trade secrets. Foreign governments often provide their industries with assistance to spy on and steal US technology.
2. It pays to spy! A lot of companies (domestic and foreign) and countries believe that it is easier to steal technology than develop it on their own. The statistics are pretty shocking. 100+ countries were involved in spying efforts in the United States for the sole purpose of getting information on US technology. The US government estimates that there were over $200 billion in direct losses from the theft of protected technology.
3. With friends like these, who needs enemies. The foreign perpetrators are friend and foe alike. France, India, Israel and South Korea are listed among the highest threat countries, along with China, Russia, Iran, and Cuba. Foreign governments often utilize their own nationals working and studying in the United States to collect information on US science and technology.
4. Right on target. Some of the most targeted industries are Information Technology, Laser and Optics, Aeronautics, Space and Marine systems, and chemical, biological and biomedical technology.
5. Employees talk…a lot. Employees or former employees give away a significant number of secrets. This activity can be unwitting. For example, when an employee talks about the project he is working on over a friendly drink at the bar with a stranger. It can also be on purpose. Mr. Barr had a few examples of employees at high profile companies giving technology to competitors in exchange for jobs.
6. Heads in the sand? Most American companies are simply unaware of the threat. Let’s face it. It’s just not how Americans do business. In fact, Americans often have a hard time grasping the concept of Industrial Espionage in general. As American companies continue to expand into more overseas markets, and more competition comes from foreign competitors, American business must recognize this type of activity takes place, and face it head on.
As always, knowledge is the first step to taking positive action. So, now that you know this activity happens, be proactive. Take a look at your business (or at your clients). Are you in a target market? Do you have security measures in place to combat the theft of your intellectual property? Where is there room for improvement? Your patent attorney is a good place to start. Patents are an important part of protecting your innovative technology, but by no means is it enough to secure all of your Intellectual Property. Consider hiring a specialist to help you put the systems and procedures in place to help protect your intangible assets and trade secrets too.
If you think that you are at risk or are the victim of Industrial Espionage, the FBI has an Economic Espionage Unit to help US companies. For more information, check out www.FBI.gov and look for “Counterintelligence” link under “What We Investigate”.