New cases that have gone up to the Supreme Court are going to have an impact on the 3D printing industry, and patent attorney Chris Higgins takes us through what everyone needs to know about protecting 3D printer files. He identifies common misconceptions about 3D print intellectual property from patents, to business models, to design files and trade secrets. Find where innovation can happen in the patent world and how to protect trade secrets and prevent patent litigation issues through our discussion with Chris.

Today, we’re going to talk IP again, intellectual property and copyright and patents. It’s one of our more popular episodes over time. We’ve done a few on them and we’ve interviewed a few different attorneys. Today, we have another one and it is sponsored by MakerBot 3D Printers.

We definitely have found that this topic is of particular interest to a lot of you that listen to this show on a regular basis. This topic on protecting 3D printer files has a different take on it, we’re not just regurgitating the same stuff. There’s some new cases going through the Supreme Court right now that are going to have an impact on our industry here in 3D printing. This is going to be stuff you want to check out.

We don’t suspect that by the time this airs that they will actually come through with their ruling because it does take a couple of months for the Supreme Court, although they heard arguments prior to us recording this, but they haven’t necessarily come through with any judgments or anything like that. If there are, we will put links into the show notes. Be sure to check out the 3D Start Point show notes on protecting 3D printer files over time and keep checking back if you’re curious about how things are happening in this area.

It has an impact both on protecting 3D printer files, just the 3D printing industry, equipment development, software development, all those things in general. Chris Higgins from Orrick Law Firm in the DC area is our guest today. He’s a patent attorney who has a global reputation as an authoritative source on 3D printing and intellectual property.

He’s spoken at a lot of additive manufacturing and 3D printing conferences, events over the last couple of years. They really pride themselves on advising on all aspects of it, whether it’s prosecution, litigation, portfolio management, which I think portfolio management is probably the most important aspect. I’m really glad we got to that in this conversation with him as well.

We fit a lot in. There’s a lot of good nuggets in there, especially in terms of business strategy with regard to an intellectual property, portfolio or your company valuations, all sorts of things, both offensive and defensive considerations here. Let’s listen to our conversation with Chris Higgins.

Listen to the podcast here:

Protecting 3D Printer Files with Chris Higgins of Orrick

Chris, thanks so much for joining us today. This is one of our favorite subjects to talk about, is intellectual property and protecting 3D printer files.

Thanks for having me.

Patent for a 3D printer

Let’s dive a little bit into your background. How long have you been really working with 3D printing and intellectual property? I know you’ve been a patent attorney for quite some time. How long have you been really focusing on that as a portion of your practice?

Probably for the last three years I’ve been focusing on 3D printing issues. It started probably in 2013, around there. A colleague of mine here at the firm, we’re interested in new technologies and 3D printing was the hot topic out there, the new technology. I decided to read up a little bit on what was going on in the industry. I came across some articles on patents and 3D printing. What I noticed was there was a lot of misinformation out there. This seemed like a great opportunity to jump in, get your names out there and correct some of the information that was wrong about 3D printing and patents and just hope to educate the industry. That simple concept has grown to speak all over the world and we’ve built a practice out of it.

Let’s talk about that. What is some of the misinformation? What’s the most common ones you find?

The biggest one out there that even still goes on today and we always get the question asked is, “We heard this …” One patent is expiring, say it’s on an FDM printer or stereolithography. There’s articles out that say when this patent expires, everyone can go out and build their own desktop FDM printer or stereolithography printer. While it’s true that you can practice what was in that one expired patent, there are thousands of other patents out there that may claim incremental improvements on that original patent. You can maybe practice a technology that’s 20 years old, but you’re really not going to get very far in the industry and you won’t be able to produce a product that has up-to-date technology that people really want. I think that’s where we’ve seen some of these companies fail that are just using this old technology.

That’s interesting. We know that fairly well because our businesses, we have 37 patents. We watch that all the time happen in consumer products, is that they don’t even realize also what new things have been filed and that there are extension patents that come up and all sorts of things that most companies aren’t really aware of how that works.

SLS patent diagram from the University of Texas

There’s one example that we like to use, and I believe it’s on the patent that the University of Texas had on selective laser sintering. I think that expired maybe two years ago. We had a question from someone at a conference saying, “This expired, can I go build my own printer?” We ran a search just for the word selective laser centering in patent claims. There were still 119 patents that had that exact phrase in the claims. When we brought it out to search for the entire specification, there were at least 2,600 other patents that were still in force on selective laser sintering. The audience was just completely shocked. They were not expecting that coming out. They thought this patent expired, that everyone can do SLS. People don’t realize how many marginal incremental improvements are patented in each technology area.

Those are rather murky waters to be wading into if you’re trying to get in to that business. Holy mackerel. We look at it a bit differently. I think it’s great that desktop 3D printing is shifting around. I guess it would be 2009. Some patents expired and allowed at least the exploration into the 20 year old technology. That yielded itself to an amount of exploration and innovation that can be built on. To think that you’re just going to able to be successful doing that is a mistake.

Absolutely. I think that patents get a bad rap because people think they’re stifling innovation because, the patent expires, you can only go out and do that old technology. At the same time, the fact that these patents are out there is the reason we have so many different types of 3D printers out there because people are trying to innovate and get around some of these patents that are seen as blocking patents. Patents aren’t stifling. There’s some of them that are, they’re keeping some people out of market. They have caused people to innovate more and come up with new ideas and new 3D printers that otherwise they may not be able to come up with.

I think Objet is probably a good example of that. They went around and developed a new technology. They may have their own patents on that. They got around the early laser centering and stereolithography patents with their own. There’s always a way to get around something. If you view patents as giving you a roadmap of what you can and cannot do and think about how can you grow your company and get the most value in what more people want, that’s at least what I try to get across to companies and not view patents in the bad light that sometimes people view them in.

Certainly, we’re big believers in patents, we have a bunch of them ourselves. I know the open source community generally doesn’t like patents because they want everybody to share everything. I agree with you that it does foster innovation. I think there’s also a danger, if you’re a new company that wants to get involved in the 3D print industry and you think, “Hey, I’m going to build on another technology,” you may very well be reinventing the wheel over somebody else who either has an application that hasn’t published yet. Or if you haven’t done a good enough search. How big a barrier to entry is that? For someone to do a search and get a decent opinion on the landscape of the patents in the industry so they can try to navigate safely?

It is a barrier to entry and a lot of startup companies that may give me a call and ask this question, it’s out of their reach on their current round of funding to be able to do it. It’s tens of thousands of dollars to get a good, what we call a freedom to operate opinion where we will go out and look at the patents that are out there. We’ll try to see what applications have been published and what may be the result of those and what the industry is doing as a whole. That there is prohibitively expensive for startup companies and even some established companies in the industry. What we’re seeing, at least from our end, is a lot of these companies will just forgo that search and take the risk and try to get their product out there. While that’s not the best, from a legal point of view, not the best way to go about doing that because the patents out there can be a barrier to entry. That’s the only option that they’re forced with aside from doing a search on their own.

They may find themselves on the wrong side of a patent litigation suit from a bigger company someday though that they may really regret.

They’ll find themselves on the other side of a patent infringement suit or they’ll try to be acquired by a company and get a very low valuation if they don’t have their own IP. There’s a lot of scenarios that can play out, none of them are typically good if you go in blind and not know what patents are out there.

You could wind up here if you intentionally or unintentionally infringe on a patent.

I agree. Interesting. What other types of misinformation … You mentioned there’s some misconceptions out there. What are some others?

I think another one is that 3D printing itself is going to create this big upheaval in patent law and patent law isn’t well suited to handle issues that come up in 3D printing and protecting 3D printer files. While there may be some intricacies and novel issues that come up, a lot of the IP issues we’re seeing in 3D printing, especially in patent law, they’re not new. The technology is new. But terms of patent infringement, there’s a … FormLabs was just sued for patent infringement. It was based on a part of their machine. It’s not some novel, different process of 3D printing that there isn’t a law to cover it. When you get into copyright issues and things like that, it gets a little murkier but there’s still no … We haven’t seen anything even in the …

Another example is the Align and ClearCorrect litigation that was in the International Trade Commission. The braces for the orthodontics use 3D printing to make the molds. The issue was whether if you import a digital file into the United States, could the ITC block that? It turned out, from the Federal Circuit, that you can’t restrict the import of a digital file. They don’t have the jurisdiction for that. While people view that as being a unique aspect of 3D printing, digital files aren’t unique to 3D printing so that topic can come up in other technologies as well. There’s always corollaries to something else. I don’t think we’re at the point yet where we’ve seen 3D printing evolve to the point where there’s this new issue that patent law can’t handle and we need Congress to step in and change the law in some way.

From our opinion, protecting 3D printer files has been a murky issue for a long time, as designers, period, of any kind of 3D printer files. Doesn’t matter whether it’s a design file, we were doing this long ago in all sorts of CAD. The fact that it’s now a 3D printer STL file doesn’t mean anything to us in terms of its particular nature. It’s the design itself that is getting murkier and more difficult because it’s not always patentable and it’s also not always clear if it’s copyrightable or protectable from that standpoint. As a designer, it’s become very … It’s kind of murky waters, as you put it.

Especially in copyright. This issue was just argued at the Supreme Court yesterday. There’s a case on cheerleader costumes.

Protecting 3D printer files – even 3D printable cheer leading uniforms.

Cheerleader costumes, I know. I was actively reading that up yesterday going, “I can’t believe that this is in front of the Supreme Court.” I didn’t even know until yesterday.

It seems odd but there’s a good corollary with 3D printing. The issue in this cheerleader case is whether there were some stripes on a cheerleader uniform and whether you could separate the utility aspect, the functional aspect of the cheer leading uniform from what they’re trying to say are design elements in the dress. There’s about ten different tests across the circuit courts. Now, it’s up to the Supreme Court to maybe come out with one test to clarify this issue on, can you separate out functional elements from design elements that can be copyrighted? The same is true for 3D printing, if it’s in something that’s printed or in a design file, can you separate out those functional aspects from those where a designer has added his or her own personal touch or creativity to it such that it can get into copyright protection. It’s a very murky issue and hopefully the Supreme Court, in a few months, will clarify that.

Boy, I hope so too. As a professional designer, this has been problematic for us. We’ve actually lost very real revenue from a large national retailer that knocked off a design of ours. That was a particular element. It was definitely a very designed element into a stitch pattern we created. They knocked it off and they were intending to cut out our client who was the original importer of the product. They just went straight to the factory and said, “Hey, duplicate this and make it.” Because it’s a physical object and it has utility, it definitely is somewhere in the middle there. I think in 3D printing, we experience this a lot. I have no problem with separating out functional aspects of a design that’s 3D printed if I can protect the unique appearance. It seems to me that in the photography world, they’re so much better protected for the eye of the photographer and a picture that they take being protected much more easily than we are as the designer of a unique three-dimensional object that gets 3D printing, at least currently.

Absolutely. The one issue that I try to grapple with is, you bring up photography, someone taking a picture, they have different angles and lighting and stuff, they can add their touch to it and get some protection. For 3D printing, everyone wants to scan something now and re-create something. The closer or the better the technology gets to, I don’t want to say cloning, but almost producing exact replicas of what’s being scanned, the argument gets much harder to get any protection for the file that’s created, the scan or what’s ultimately printed because it’s so much similar to what was actually scanned. It’s hard to argue in the current copyright laws that you’ve created something, done any creativity to it to get protection.

I would agree. If I understood you correctly, you’re saying someone who’s using a scanner, and as the scanner technology gets better and better, you could scan another object, create that file and claim it your own. I don’t think you should be able to do that, much like if you use a Xerox machine to copy somebody’s photograph, that’s not only probably risking violating somebody else’s copyright, but you certainly couldn’t claim that Xerox image as your own.

Absolutely. Where people have tried to make the argument otherwise in 3D printing is that there are steps involved into once you get the scan you have to manipulate the STL file, do some things, you can make selections on how you print the final product and things like that. But what ultimately gets printed, if you’re wanting it to be similar, like a photocopy, very hard to claim copyright protection there even though there will be people that try it. People are talking about it and we’ve gotten questions about it.

Protecting 3D printer files: does every design need to be patented?

As a designer, I actually worry less about somebody who goes and wants to claim copyright protection if they have scanned, essentially reverse engineering something that I’ve designed that was 3D printed than I am my being able to actually claim copyright protection on the original work. That’s a murky water for us because a lot of times, we spend 200 hours designing something. It’s not a fast thing. If at the end of the day, we’ve had this question and we’ve designed a 3D printed tie and a tie is inarguably a functional object, a necktie. It’s functional but there is no way that this is not, in a sense, ornament when you look at it, it’s definitely ornamental. It’s a clear design that took 200 hours to create it, it’s not your traditional necktie.

To then not have it be, “Do I have to patent this,” which is expensive every time you go to create a design in 3D printing because the technology’s a lot easier. “Do I design patent it? Do I automatically have copyright or can file a copyright?” That’s where the clarity would be so helpful to the growth of the design in the 3D print industry, which is actually really necessary right now. The content side of it, I think there is a need for clarity there. I agree, it’s very different from the patent issues with machine technology. I also agree with you that there’s really nothing new about applying patent law to that. I think the bigger issues and more clarity needed is definitely on the content side, would you agree?

I would definitely agree. I think one additional point to that is, you mentioned design patents as being one option. I think they’re often overlooked but they do hold value in 3D printing as an option or an alternative to copyright or utility patents. Most people don’t realize that in the Apple-Samsung litigation, that $400 million verdict was based on a design patent.

Certainly, it was. We’re still waiting on a final decision on that one too, aren’t we?

Yup.

We think that completely makes sense. We have design patents in the mix of patents that we have as well. We recommended, in fact, recommended to that particular client that we were talking about with this copyrightable stitch pattern that we believe is copyrightable. We recommended the design patent to them and they said, “In our experience, design patents are useless. We don’t really want to file it.” They didn’t and again they lost millions of dollars in sales. It was dumb for them not to listen to us and our experience saying you should just do it anyway. That is our recommendation and we have done that. The reality is that in 3D print design, the designs change and the iterations … It makes it harder to design patent because you don’t narrow down to something that then you tool for, which is in the case of the Apple patent for the bevel edges and things like that, you’re going to make a product where you’re going to make millions of units instead of one.

Even the Bat Mobile has a patent.

Absolutely. That’s one issue with design patents, is you can make a few changes and get around the design patent much easier than a utility patent or copyright. That’s one consideration that companies always need to be aware of. It’s just like with utility patents. It depends on how that design is characterized in the filing, how it’s described. If you can get it broad enough where you can cover some basic changes in the design that someone may try, it can be a lot more valuable than something that’s narrow and may not cover all these changes.

One example would be the, back in the 30s, Coca Cola design patent on its bottle. It was very broad and it was powerful for a while, getting that classic shape of the Coke bottle. On the other hand, you have some that may not be as valuable and are very narrow. The original Batmobile is actually the subject of a design patent. You can look it up as drawings, this is from the 60s, drawings of the Batmobile in detail, probably not all that valuable if someone wants to make a few changes and have something that looks like the Batmobile. Nonetheless, they have a design patent on the original Batmobile and the iterations of the Batmobile.

Sure, the ability to make slight changes is problematic. We’ve actually experienced that in our business history as well. To, me the bigger issue for designers creating content for the 3D print world is that the cost associated with trying to enforce that design patent, if someone infringes on you, it’s still a very high barrier for small companies. It does seem that many companies that are I guess a channel of distribution for copyrighted material give a lot more credence to a registered copyright and will take something down that the copyright holder claims violates it and ask questions later. Whereas, when it comes to patents, it’s like, you say you have a patent. They say they’re not infringing. When it’s settled in court, then we’ll worry about it. Copyright has more power ironically online.

Yeah, with the DMCA take down procedures. In the safe harbor grants, you take it down. There’s a lot more power in copyright than in patents. You’re absolutely right, the cost associated with bringing a patent litigation and not getting the quick settlement and having to litigate that through is in the millions and millions of dollars. It’s just way too much for many companies to even consider or fathom bringing a case to enforce their patent rights. I think that leads a lot companies not to even consider getting patents in the first instance because they think, “Why should I pay $20,000 to get a patent when I’m never going to be able to enforce it anyways?”

Now, we’ve thoroughly depressed our listeners toward thinking patents are the way to go. I think though, there is hope in this cheerleader example in the Supreme Court where if there can be a more defined test and they can carve out some separation for the more ornamental or design aspects or something versus the functional, I think there’s hope that the little guy can stand a chance in the future. It make it clear, like our tie. Just because it’s a tie doesn’t preclude it, it now goes based on the face value of its ornamental design and the copyright ability of that digital file.

We’ll find out in a few months. If the Supreme Court can lay out a clearly defined test, which in the past few IP decisions, it’s typically not what we end up with. Usually it’s something very murky that comes back up to the Supreme Court years later. We get something very definitive where you can separate out the ornamental elements of a design. That could help the smaller guys get copyright protection, get protection for their ideas. We’ll see what the Supreme Court ends up doing with it.

Let’s just hope it doesn’t end up in a four-four tie. Because we don’t have nine justices right now. We don’t want a tie here. Anyway, you mentioned before when we were off air that you have a 3D printer on your desk. Now, do you actually 3D print or you’re just exploring it? Are you trying it out? What is your experience with it?

I got it more of just something to have in my office. I was speaking at a show and this company was there exhibiting the printer. I talked to them for a while. They’re local to DC. I got the printer, put it at my office. I’ve printed out a few things here and there. It’s a small one. I have a three year old son so I’ve printed out little excavators and Superman things for him. He likes to come in the office and play around with it. It’s great in that sense. As far as doing anything useful, a colleague of mine, he forgot his cuff links and was getting on the train to go up to New York City. In hour, I printed him off a bright plastic pair of blue cuff links.

Blue 3D printed cuff links by Mutating Creatures

At least he got a great conversation piece instead of, “What happened to your sleeves there?”

That he did.

That’s great. I think this is the classic problem though with 3D printers in general and why we’re seeing a beyond the hype situation, behind the hype cycle right now, is because you get this printer and the big question you ask and that’s why we have our show, the name that it is, is what the FFF do I print now? It’s that kind of question you ask yourself. Is it worth the investment if I’m just going to occasionally print a toy here and there? Getting into it and deciding that you want to use it is daunting.

I completely agree. When I got it, I was printing things out every day and now I maybe use it once every other week. Not only the difficulty in trying to design something to print out on your own and having the time to do that. Even when I download something, say from Thingiverse or another online site and then try to print it, the maintenance of the printer, every other print may fail. There’s a lot of frustrating aspects of a desktop FDM printer right now that a lot of consumers out there don’t want to deal with. The technology still has a ways to go before it’s going to be commonly accepted that multiple people in my law firm may have 3D printers on their desk.

Exactly. Will that happen one day? It’s one thing to have to search through those free 3D printer files and wonder whether or not they’re any good to begin with, is there’s not a lot of judgment, not a lot of information in there. To create your own 3D printer file, yeah, you have to have a lot of design skills and a lot of extra time on your hands. In our opinion, that’s actually where the biggest innovation can be happening right now, is in content generation that makes it easier for people to not have a lot of design skills and be able to print.

I agree 100%. Having user friendly software that allows novices to create not just simple designs but something they can use, practical devices and things they can print out, that’s where we need to get before maybe the hype curve goes a little bit back in the positive direction.

Was there any other misinformation and things that you wanted to clarify that you really talk about or get a lot of questions on while you’re out that we should be letting our listeners know about?

You’ve talked a bit about how it’s hard for companies to get patents. It can be discouraging when they’re looking at that. A lot of what I have tried to do lately, in the past year I’ve shifted my presentation and approach to the topic to more of not just what’s going on in the industry but how can you maybe use this to your advantage. One thing that a lot of companies don’t consider is, there are so many different aspects of the technology involved in a 3D printer. You need to focus on which ones will be most valuable down the road. There’s always going to be 3D printer hardware and the software that runs those printers.

While it’s probably a whole other topic we can have a show on, software patents are much harder to get now after Alice. Hardware and maybe new extruders, new nozzles, things like that and the build materials are areas that are worth focusing on could be valuable in the long run. A key part of that is not only protecting what you’re doing as company, which I think is what many companies focus on, especially startups, they just want to protect what they’re doing. Instead of looking five to ten, even fifteen years down the road as to where the industry could go and what could be valuable, that’s where the valuable patents could be on. You want to get a patent on what’s going to be done ten years down the road, not what’s being done right now.

Especially by the time it issues and then you’ve build your company, it takes a lot of time there.

That’s one thing that we tend to counsel people on, is that if you’re looking at an invention you want to patent that may only be valuable for the next three years, because 3D printing is always evolving and rapidly changing, it may be worth considering keeping that ideas a trade secret. That’s a foreign concept to a lot of people. They don’t understand what a trade secret is. There’s no upfront cost in keeping something as a trade secret. There’s a cost in maintaining the confidentiality and things like that, but there are no subject matter constraints. You can license it forever and you can take people to court, there’s now a federal trade secrets, Defensive Trade Secrets Act. It’s now a federal cause of action if someone misappropriates a trade secrets.

There’s many things to consider that even if you’re discouraged that you don’t think you can afford a patent or a patent may not be correct or something, has a very short shelf life, there are other options out there. You should always be thinking about ways to protect your IP because that is what makes a company valuable. A lot of value in, especially in tech companies is in IP. If you don’t have IP, you have nothing to either fight back with if you get sued. If you’re thinking about getting acquired, if you don’t have IP, your valuations going to be much, much lower than a company that has valuable IP. There’s a lot of different avenues that a company should consider and not just shelf the idea of patents or copyrights, things like that because you think it’s going to be too much of an upfront investment. It would really pay off down the road.

Protecting 3D Printer Files: consider keeping trade secrets.

That’s such a good point. The valuation, we have a program here we call IP Hacking. I know that sounds a little awful and weird but we use our skills for good, we promise. When we have someone, and we’ve done this for three companies and actually raised their valuations when they got bought out, is they based their company on what is maybe a core patent, one single core patent. We go in there and we say, “You think this is a strong patent, but it’s probably not.”

The first thing an attorney’s going to do when you go to get acquired or you go to have your valuations is they’re going to do an opinion letter on how strong it is. What we do is we actually sit there and we try to hack that patent, figure out other ways to make the same product, ways to get around it and then we circle that patent, we close the holes is basically what we do. They tend to develop three to five more patents that might surround the single patent. Now, you have a bigger IP asset base because now you have six patents instead of one and you also have already plugged some of those holes so there are less arguments that you don’t have the strength that you might have.

Granted, they aren’t issued yet, they’re just usually provisionals or initial filings at that stage, that’s up to you as the owner of those. We have found it has worked tremendously well for companies, even companies where the lifecycle of their product might not be more than three to five years. This is in consumer goods in general. That’s because it is still a bit of a deterrent to have patents in the consumer product world.

Absolutely. That’s a great way to think about what you guys are doing with these companies and trying to hack the patents. Another thing that we’ve counseled people on, and I had some experience with this when I worked about a year in house in the medical device industry, was you have these core patents and then you do a search and you look for white space, what it’s called, where there’s gaps in patent protection on that industry. You look to see if you can expand your core patents to have maybe an earlier priority date and draft claims that reach into that white space and cover gaps where your competitors maybe don’t have protection or in a direction the industry could go into.

We found that even just getting provisional filings or filing applications on that can really help the valuation of your company because you have the strategic not only vision for IP but you’ve actually put it into practice. You may have this really valuable patent down the road because you did this robust search. What you guys are doing, the IP Hacking, you’ve looked at your patents and evaluated them. You know what you have and you know what the industry is going. It helps to not only get a higher valuation but you can then back up your own thinking behind your company’s value and maybe increase it in that way too.

That’s a really good point. We have what we call the 2% rule here. Based on whatever budgetary value you place on it, if you spend more than 2% on the patenting and IP initially, then you’re making a mistake. We look at it as, this is how we decide should we file a provisional or should we file a regular patent. When is the time to go forward, it’s also an evaluation point for whether or not a PCT or international patents are worth it. If you don’t have revenue to justify it or if you don’t have a market share or a valuation to justify it, then you don’t spend more than 2% of what your existing value is at that moment. That’s how we judge it in deciding whether or not you’ve proven that there’s a market for something, because we hate to file a patent that you can’t commercialize.

Absolutely. While it’s not good for an initial business aspect of my practice, I’ve told people not to file patents on certain things because you’re spending too much of what money you have right now. This is probably not going to pay off in the long run, you’re better off to invest that money elsewhere, come back and get patents on some core technology you have or another idea down the road. It’s not worth it just to file a patent, to file a patent and say you have one. You have think about it strategically and file ones that will have value down the road.

Also, in the development process, so many things could change as you start to shift and understand your market better. You’d be filing a patent maybe that isn’t even what your end product is going to be like. The longer you can wait to do that … That’s why we were really thrilled when provisional patents became so prevalent and the ability and access to them became easier.

Absolutely. I think that provisional patents are one aspect that a lot of companies, even individuals don’t utilize enough. It buys you an extra year to see where your market is going. If you’re going to have more money down the road, if this design’s going to pay off. It’s $1,000, you can get a provisional patent prepared or less if you’re smaller entity. It’s something that can be really useful to buy yourself extra time to see what you may want to invest your money in.

I’m sure that you don’t really want to do any kind of future predicting as an attorney. However, where do you see the future of 3D printing going in terms of what’s happening with these patents expiring and other things? Do you see it shifting? You were talking a little bit about more process in software, where do you think that it’s going to shift over the next few years?

In terms of the industry as a whole and IP, I think we’ve seen, as you mentioned, the hype curve come down a little bit but it hasn’t slowed down in what we’re seeing the action in the patent area. There was a just a recent patent infringement case filed. We’re hearing about the patent trolls now becoming involved in this area. We’re aware of several patent trolls or entities that don’t practice their patents, they just hold them. They’re building up portfolios out of 3D printing patents. It seems everyone is investing the money into 3D printing and just waiting for the pipe to burst. I think we’ll see down the road maybe three to four years, there will be some patent troll activity in 3D printing and there’ll be more 3D printing patent infringement suits filed. The areas where that is probably going to be more focused on will be materials and software, if I had to make a prediction.

I agree with you. I think there’s going to be a lot of strength in the material development that’s going on and things like that. Also, at the same point, I worked for many materials and chemical companies like Milliken & Company. Although they have tons of patents, they also have a lot of trade secrets and propriety technology. While they may be patenting certain aspects of it, I can guarantee you, they’re keeping secret a lot of other things too.

Absolutely. 100% true. Especially software and materials, there’s a lot of trade secrets, there’s a lot of patents out there.

And they go hand and hand to protect everyone.

People are focusing more on metal 3D printing, the materials and getting the cost down and developing those to remove voids and make them more suitable for military use and in the aerospace industry. I think that’s a big focus going forward and there’s a lot of money and research going into those areas that a couple years down the road, with all that money going in, I think we’ll see some pushback with IP rights there.

It was very exciting. I’m looking forward to all those metal developments. We’ve experimented some with it and we’re working on some other things now with using metal 3D printing. Boy, I hope to see more advancements there.

Definitely, especially with aerospace and we do some work in defense contracting. The possibilities to use 3D printing, not only in a factory to make specialized parts but also to deploy a 3D printer out in the field on a battleship for instance and make new parts. I think the possibilities are endless for what that can be used for if they get the right materials and software on those machines.

Super exciting. Thank you so much, Chris. We really appreciate you spending some time with us today and sharing your thoughts on the state of the industry, protecting 3D printer files, and IP and where it all stands. That was some good new information I think that our listeners will get a lot out of.

Great. I hope your listeners find it helpful. Thanks again for having me on the show.

Protecting 3D Printer Files – Final Thoughts

Protecting 3D printer files with trade secrets.

I think that was another really good installment of the intellectual property issues and things concerning protecting 3D printer files that we’ve covered here on WTFFF. One thing I want to emphasize, it came up in the interview but it wasn’t really emphasized enough I think, is the idea of trade secrets. Chris made a really good point. To have a trade secret doesn’t really cost you anything. It is intellectual property or it can be as long as … Here’s the real consideration, because I’ve actually experienced trade secrets in our business over the years with clients and things. Some are very bullish on patents, they want to file out patents, and others really don’t. Here’s I think the key consideration. If whatever it is that you have developed, whether it’s an actual functional product of some kind or it’s a process by which something is made. I don’t know how well it works in the software world.

If whatever you’ve created is very hard to reverse engineer, very, very hard, if really you don’t think it can be done or certainly without spending huge, huge sums of money, like tens of millions of dollars for someone to try to reverse engineer something, then you’ve got a great candidate for something to be a trade secret. All it means is exactly that. Whatever it is you’ve developed, you’re going to keep it secret. You’re not going to tell the world. Because here’s what happens in a patent, you get patent protection on a utility patent 17 to 20 years, depending on whether it’s from when you file it or when you get it. There’s a few standards to that.

Let’s just say, for the sake of simplicity, at the most 20 years you’re going to have a patent for it once you file it or once you get it. 20 years of coverage. That 20 years in business is going to go by quicker than you think. The only way you get that protection is if you then disclose everything about your invention. That’s the issue. The Patent Trademark Office says, “We’ll give you 20 years exclusivity, a monopoly on that aspect of whatever you’ve gotten granted as a patent. For that 20 years of exclusivity, you have to disclose to world, right now from the beginning, everything about that patent.” The purpose is so that other companies can learn from it. That’s the innovation that Chris was talking about, that patents do spur.

It opens up that white space he was talking about, which is actually what we exploit when we design for clients. We exploit the white space in between those patents all the time because that’s where the innovation can happen. That’s where the incremental innovation, this is not revolutionary innovation by any means.

But if you have a trade secret, all you have to do is keep it secret. As long as you can do that, and you have to be careful with the employees that you let know this information and you have to make sure they’re contractually bound to keep that confidential. There is a process you have to go through that’s a bit different, but it’s a lot less expensive than patent prosecution and patent litigation for sure. As long as you can keep it quiet, then there’s no limit to how long you can keep that trade secret.

Protecting 3D printer files: patents vs trade secrets

I just want to make sure that people understand a little bit about how that can work. For instance, you might patent the recipe for something, what’s in it? Coca Cola is a great example. The formula for Coca Cola. The what’s in it. The way that you process it, the order in which you do it, might be your trade secret. It makes the difference between it tasting good and it not tasting good. That may be some ways that you can do it. You can actually combine something patented and something trade secret at the same time. That’s actually what Milliken does a lot of. They patent a piece of equipment but how they use that equipment is not necessarily exposed.

You don’t even have to patent the equipment, what the equipment does and how it works can also be a trade secret because that’s sitting in a factory somewhere, it’s not out being sold. If you really engineer that piece of equipment to do something unique to make a product, you don’t have to divulge that. The Coca Cola thing, actually the recipe for Coca Cola is a trade secret as well. It was never patented or copyrighted. Lots of people have tried to copy it, that’s why Pepsi exists, but they have their own formula.

I think as Chris was talking about development of materials being a big thing, I think that the material science of what makes up new filaments or new resins and all that, you can keep that information very quiet. You have to disclose of course in material safety data sheets what all of the resins that are in there and all of their potential health effects and all that, you have to disclose that. You don’t have to disclose the proportions of it, the exact processes by which they’re combined, all those sorts of things. It can be very hard for another company to try to duplicate your material because they don’t have the complete recipe. Trade secrets are a great thing and really underutilized I think in business today.

That’s one of the things, I want to step back to what we started talking about at the beginning and we talked about quite a bit over the conversation, which is the 3D printer files themselves and the idea of a 3D printer STL file, what its format is. A 3D printer file format, I’m surprised that we haven’t see more deviations from the STL format and from the new developments on them, what are they calling it? The 3MF or something like that. 3MF maybe, the new file format. I’m surprised we haven’t seen more of that because having a proprietary file format that allows you to do something special, that’s a great trade secret right there because it allows for ease of printing, you could build a lot of things in there. I’m surprised we haven’t seen more development on that side.

I think it’s part of a misconception in the market that it’s necessary to be open ended about it and have STL files that can go on any printer. I actually think that that might be a mistake in a more consumer oriented industry. In a more consumer oriented industry, do I really care what the file format is? Do I really care if I can transport it from one … If I’m not designing it myself, I don’t care. As long as a format that is compatible with my printer exists. If it’s within that format that there’s these great trade secrets that make it easier to print, makes it reliable and build all of that in there, wow, that’s really valuable right there. That makes that printer itself more valuable even if it has nothing patentable about the printer itself.

United State Patent and Trademark Office

I think that the reality of this industry and all the technology involved, there are so many opportunities for companies to create something that is truly unique and proprietary, that is true intellectual property that can raise their asset value if they are looking to be acquired. There’s so many areas it can be done. I think what Chris pointed out today is, you’ve got to be very careful, obviously, and make sure that you understand the landscape of laws that are out there and make sure you don’t accidentally trip over and infringe on someone else’s patent. That’s very important. In terms of the cost of potentially having to file hundreds of patents, which can get very expensive. Companies that are $300 and $400 million a year type of companies have budgets to go and file 100 patents a year. Companies that are billions of dollars like Apple and Samsung go and they’re filing like 100 patents a month. I remember the stats I was looking at. Their budgets are huge for that stuff.

We look at it from the standpoint, it’s like we’re going to really be paying close attention to that cheerleader uniform copyright case that’s in front of the Supreme Court right now because for our future business purposes, it’s not going to be viable for us to file design patents because the design files that we want to create are uniquely 3D printable. We aren’t going to be making millions of a unit of something to make it economically viable to be filing design patents on things for the most part. There may be some exceptions to that but for the most part.

I can see certain design files being distributed widely enough in the future that each one is distributed to 10,000 people maybe over its life of several years but not necessarily millions of people. Maybe that’ll change someday, ten years down the road, it’ll be more like that. For right now certainly, I think that just the scale at which it would get used is not enough to justify design patents. There won’t be enough revenue from them to justify waging a couple million dollar patent infringement lawsuit.

Even based on our 2% rule, I just don’t think that each design file in and of itself would generate enough revenue within itself to make that the case in the way that it would be printed and design patentable because it’s so restrictive in terms of what you can do. Any time you start to make changes to it, modifications, you customize it, you deviate from that. That’s really where the copyright is going to be more valuable for us and much more practical and economical to be able to file a copyright on every unique design. I think that the customizable aspect in terms of adding text to it with your name and all that, I don’t think that’s going to be an issue.

If something really gets completely twisted around and becomes something else, I’m not going to worry about it too much. I don’t think I need to go and wage that fight. Just to keep people from putting knock offs out there, like we’ve seen happen on stuff at one point that was taken from Thingiverse and put on eBay. It would be much easier for those involved if copyright offers them protection. It’s just cheaper to get, you can easily afford to register every design you do if you’re doing a certain amount of business with it. It’s much easier to enforce.

This was really interesting. Protecting 3D printer files and IP issues are some of our favorite subjects to talk about because there’s always a great debate going back and forth and there’s always progress and improvements and different things coming up. Keep up on that with us on social media @3DStartPoint. We’ll be sure to keep up on the Supreme Court thing and either update this blog post or have another show on it if there’s enough information, or both in the future. Regular listeners, you will be sure to hear about it and we’ll be excited to bring it to you.

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About Chris Higgins

Chris Higgins is a patent attorney who has developed a global reputation as an authoritative source on 3D printing and intellectual property. He has been a featured speaker at 3D printing and additive manufacturing events around the world, educating the industry on innovative solutions to capitalize on 3D printing intellectual property. His 3D printing practice at Orrick includes advising companies on all aspects of patent law, including prosecution, litigation, and portfolio management. Chris also pulls from his background in the medical device industry and partners with Orrick’s Cybersecurity and Data Privacy Group and Technology Companies Group to help clients grow their businesses and capitalize on market opportunities.

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