Traditional chemical manufacturing is capable of producing crystals, polymers and simple molecules. Nanotechnology differs from traditional chemical manufacturing in that the chemical reactions are not left to statistical movements of molecules in solutions, but instead the molecules are brought into appropriate positions with appropriate speeds and orientations to cause desired reactions. Therefore, nanotechnology will enable the scaling up of simple molecules into complex mechanical systems and electronic devices.

IMPORTANCE OF INTELLECTUAL PROPERTY (IP) PROTECTION IN NANOTECHNOLOGY
As an emerging science in its infancy, nanotechnology promises the nano-scale manufacture of materials and machines made to atomic specifications. It is a field at the junction of chemistry, physics, biology, computer science and engineering. Although at its infancy, a lot of attention is placed on nanotechnology with copious amount of venture funding and government grants going into nanotechnology research and development.  In 2001 the US government invested a total $422M in nanotechnology, an increase from $270M in year 2000, while for a total investment of $679M is requested for 2003 a 17% increase over 2002.

In particular, nanotech and related sensor research has intensified in universities around the world, and degree programs are increasingly offered at the graduate and undergraduate levels. Venture capital firms are showing growing interest in nanotechnology and related sensor applications, and significant nanotech/sensor projects have been initiated by large multi-national companies, with some of them allocating up to a third of their research budget particularly to nanotech.  The total market for nanotechnology products and services as predicted by the National Science Foundation is expected to be $700 billion by 2008. Steve Crosby, editor of Small Times, a journal that covers nanotechnology, estimates that $100M has been invested into nanotechnology for 2002.

The impact of nanotechnology on our way of life is widely believed to reach profound and hitherto unimagined levels in the coming decades. However, currently most of nanotechnology is still in R&D stage with no consumer offering or product in the next one or two years. With no product offering to generate revenue, it is extremely important to capture the value of the nanotechnology and related sensor R&D in IP protection.  

This paper presents a brief overview of intellectual property rights, and the various areas in nanotechnology and related sensor applications to which IP rights may be applicable. Technology transfer, including licensing and business agreements, are not covered. Instead, issues related to the science of nanotechnology and the challenges surrounding the acquisition of IP rights are presented.

TYPES OF IP PROTECTION

Patents

Copyrights

Trade Secrets

Maskworks

Trademarks

Patents

Patents offer protection for functional concepts, methods, apparatus, or processes that are novel, useful and non-obvious.  The Agreement in Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement) in 1994 defines patentable matter as any invention that involves an innovative step and has a potential industrial application.

In contrast, discoveries, diagnostic or therapeutic methods, or inventions not compatible with public order or general principles of morality are not patentable. The distinction between “discoveries” and “invention” can become somewhat blurred in nanotechnology where the principles of patent law are tested.

The purpose of the patent is to advance innovation through disclosure and teaching of the details of the invention to the public, and in exchange, the inventor or owner is rewarded the legal rights of ownership. The legal rights refer to, in particular, the right to exclude others from making, using, selling or importing into the US or offering for sale of the invention, giving the owner the exclusive rights to capitalize on the invention. The ownership rights are granted for a period of 17-20 years, depending on the date of filing of the patent.  

Patents are obtained through a costly and lengthy process. In Europe, Japan, and the Pacific, the “first to file” system applies. In the U.S. however, the “first-to-invent” system applies. However, patent applications must be filed within one year of the first offer for sale of the product or the patent filing will be void.

Copyrights

Copyrights protect the original expression of an idea. By offering protection, copyright encourages the expression of original, artistic ideas into a tangible medium. Legal protection is effected instantly, when the original copyrightable subject matter is fixed into a tangible medium, e.g. on paper or in a digital storage form.

Copyrights are much more inexpensive and expediently obtained than patents, and are valid for the author’s lifetime plus 50 years. A longer period of validity (75/100 years) applies if the creation was work made for hire, which is generally the case in the nanotechnology industry. 

Trade Secrets

Trade secrets protect any technical or business information that gives the business a competitive advantage. It need not be completely novel or exclusive, but it must have a derived or potential economic value from being unknown. Additionally, reasonable efforts must be made to keep the information secret, e.g. through diligent and the inexpensive use of Non-Disclosure Agreements (NDA).  Legal protection under trade secret no longer applies when the information is disseminated publicly. There is no formal filing procedure to register trade secrets to obtain protection.  

Maskworks

In chip technology, when the chip layout includes an original circuit design, the layout is protectable. Specifically, maskworks protect against the unauthorized copying of the chip layout information. Federal registration is relatively quick and inexpensive, but filing must be done within two years of commercialization of the chip product.

Trademarks

Trademarks refer to the distinctive signature mark that can be used to protect the company, product, service, name or symbol. The trademark must not be descriptive or generic. Legal protection is not offered to the technology, rather to the company good will and quality associated with the use of the recognized name or symbol. Trademarks provide exclusive rights within a region or nation and as long as used commercially, they may be renewed indefinitely. Compared to patents, they are obtained within a moderate time period (usually under 2 years) and typically cost under $5K per registered mark.

Building an IP Strategy

The IP rights are protected under various federal and state legal laws. Without protection, the property falls into the public domain and may be used by any party without license. A sound management strategy would be to systematically build a portfolio consisting of different IP rights, with the aim of protecting the various aspects of the company’s technology and commercial interests.

IP rights protect the commercial interests of a company at the various stages of design, manufacturing, and product operation. At the design and development stage, copyrights and trade secrets can be immediately enforced. Novel apparatus and methods can then be patented, a process that takes about three years and requires the investment of some funds.  Once a product or service is developed, issued patents and trademarks protect the technology and associated names and symbols.

The perfection of an IP portfolio is of interest to startups and their investors, whereas licensing agreements are of interest to manufacturers and customers. Whereas strategic enforcement of IP rights can be achieved through licensing, litigation and other business means, effective acquisition of IP rights must be done legally. While copyrights and trade secrets may be obtained easily, patents, trademarks and maskworks require applicant action and response within critical filing deadlines. Generally, the first to patent will have the best chance of winning the broadest patents.

APPLICATIONS OF NANOTECHNOLOGY AND SENSORS

At the present state of the art, only the simplest molecular structures can be built in the lab. However, the design and modeling of much larger structures or sensor apparatus is quite feasible with current computational methods and resources, hence we will distinguish between computational and manufacturing efforts in nanotechnology, with the manufacturing efforts roughly divided into the production of materials and tools. A large portion of nanotechnology’s popularity lies in its applications to other already established fields, such as sensors. We will consider applications as well to electronics, aerospace, environmental cleanup and sanitation, and medicine.

Molecular Electronics

As conventional semiconductor devices follow Moore’s Law to approach their physical limits, we move in the direction of hybrid circuits that incorporate conventional as well as molecular components. Today, quantum-effect nanoelectronic devices have already been fabricated in solid-state structures. These include quantum dots, which are nano-scale “boxes” holding a well-defined number of electrons that can be put together to form lattices and cellular automata with special properties, as well as single-electron transistors, devices that use controlled electron tunneling to amplify current. In addition, the discovery of the versatile carbon nanotubes and their ability to act as transistors and diodes promise new directions. Carbon nanotubes have been shown to exhibit electrical properties similar to that of silicon MOSFETs. Conversely, further research needs to be conducted to develop desired electrical characteristics of custom molecules.

Improvements on such novel circuits, for example large-scale clocking schemes for quantum dot cellular automata, as well as methods of integrating emerging molecular electronic components with current solid-state electronics are areas of active research and the architecture as well as manufacturing methods of such components and aggregate systems enjoy intellectual property rights protection. One important consideration is that while it is easy to design around specific patented molecules and devices, it is much harder to bypass architectural patents, hence their utility and effectiveness is arguably higher. Therefore, self-assembly in the development of molecular electronics is crucial. The major challenge is to develop a system that will collect the individual devices into complex electronic circuitry. 

Nanotechnology based memory chips, due to their simpler more repetitive structure compared to more elaborate chips such as CPUs, are widely believed to become one of the first components to be commercialized and integrated into existing solid-state circuits. For instance scientists at Hewlett-Packard have developed a 64-bit computer memory chip that is one square micron. The research was based on creating smart circuits by combining grids of molecular wires. HP’s research in conjunction with UCLA resulted in patents relating to the connection of these molecular wires and the traffic flowing on the wires. Flat panel displays based on carbon nanotube field emitters are another application nearing commercialization. 

In the future, however, it is likely that we design and fabricate electronic components as well as entire systems using only molecules, with a number of advantages. The smaller component sizes yield higher circuit densities, lower power consumption, possibly more precise component fabrication, as well as specific advantages such as higher operating temperatures for quantum dots, widening their range of application. Therefore, novel methods of efficient synthesis and inexpensive mass fabrication of molecular electronics components represent a fertile development ground and are protectable under IP rights.

Sensors

Sensors represent another area widely believed by researchers as well as investors to become one of the first commercialized applications of nanotechnology. The relation between the structural and chemical properties of carbon nanotubes and their electrical properties have led to a number of sensor designs currently on the verge of mass production. An example of a carbon nanotube carbon dioxide (CO₂) sensor is given by Ong & Grimes who, by tracking the resonant frequency of a multi-wall carbon nanotube coating, determine the permittivity of the coating, which changes linearly in response to CO₂ concentration.

Another major application of nanotechnology in relation to sensors is the development of dendrimers. Dendrimers are spheres that measure approximately five nanometers in diameter and are made of synthetic polymers.  These nanospheres once placed inside the human body can detect and announce protein changes in lymphocytes, white blood cells that defend the body against illness. NASA is looking into embedding these dendrimers into astronaut’s blood so that they can monitor the astronaut’s exposure to radiation while in outer space. Dendrimer patenting has been growing at an alarming rate over the past decade. In the period between 1991-95 there were 51 patents issued, while between 1996-00 there were 433 patents issued. The projected number of patents that will be issued for 2001-05 is 1,022. Installation of special purpose binding sites on the tips of carbon nanotubes has been proposed to enable genome processing without the use of expensive PCR-based methods. A much-needed technique is the inexpensive high yield production method of carbon nanotubes, and novel methods of synthesis and production will be protectable with IP rights. Computational models of simulating the mechanical behavior of carbon nanotubes are another active area protectable with patents, copyrights, trademarks and trade secrets.

Aerospace

The superior strength and low weight of fullerenes may open the frontier to space travel by drastically decreasing the cost of launch to orbit. The most extreme low cost solution to orbit are the various far-reaching ideas of a space elevator. A common thread through all space elevator systems is the usage of carbon nanotubes to be the fundamental material in the elevator design. Because of conditions of high temperatures, extreme pressures, hard vacuum, high radiation and so forth in aerospace applications, the development of heat-resistant polymers and other materials, miniature computers, molecular machines based on chemistry that can survive in space, and assembly methods compatible with conditions in space will greatly benefit aerospace applications. Moreover, novel computational models of the operation of such devices and materials in space, with IP protection enforceable at all stages of such aerospace applications.

Nanomedicine

When nanotechnology makes the construction of micron-scale machines possible, one of the first likely applications will be medical nanomachines. Freitas’ “respirocytes” represent one design proposal for micron-sized diamondoid oxygen storage tanks floating in the blood stream, in effect artificial mechanical red blood cells. One promising anti-AIDS application capitalizes on three features of the buckyball: its size, its ability to carry chemicals enabling delivery of drugs to specifically targeted sites, and its unique shape that facilitates binding with HIV infected cells.

While all development of nanotechnology could in theory be subjected to government regulation, development of nanomedical machines will spur discussion on possible threats and form future policy development. A similar model used by the biotechnology industry that involved self-regulation with governmental guidance could be applied to the nanomedicine industry. For instance, self-replicating systems could be regulated so that they would not be able to escape the laboratory and if they were to escape they would not be able to reproduce without specific environment conditions. This approach is similar to the regulation of recombinant DNA, where physical and biological containment methods were utilized. Novel designs of nanomedical machines, methods of delivery, communication, tracking, and disposal (if needed) of such machines, as well as techniques for drug release and injection of substances into cells (for example using nanotube syringes) and nanoengineered prosthetics (such as artificial bones) all enjoy IP rights protection.  

Environment and Sanitation

Self-assembled monolayers, i.e. substances spontaneously forming a one-molecule thick layer on a surface, are a technology showing promise for environmental sanitation. A layer of functional groups tailored to bind to heavy metals and assembled on mesoporous surfaces has been shown to separate and remove mercury from aqueous and organic liquids and gaseous streams. Since nanotechnology allows designers to designate exact molecular combinations, filters that remove minuscule impurities will be possible.  Fine detailed filters could mean cleaner drinking water and cleaner burning smoke stacks. Further, nanoparticles could act as tiny absorbers that could clean tainted resources. Chemical nanotechnology often goes hand in hand with economic benefits as well as environmental advantages. For instance, Nanogate GmbH, a leading manufacturer of chemical nanotechnology products, developed a solution that allowed a print roller manufacturing company to clean its rollers with less waste, overhead and downtime. Novel modeling techniques, designs, manufacture methods and applications for active and passive nanotech-based materials and machines for water-treatment, extraction of toxics, detection of pollutants, and recovery of materials before they become wastes are some examples of protectable technologies under IP rights.

CHALLENGES TO THE NANOTECHNOLOGY AND RELATED SENSOR TECHNOLOGY PATENT PROCESS

For small companies and startups, patents are among the only protections from infringement by large corporations. As companies grow, their ability to keep trade secrets  decreases and patents again become a chief method of IP protection. However, it is important to keep in mind that a patent application gets published 18 months after filing, unless the applicant opts out, in which case a foreign patent may not be pursued for the invention. Hence, unless the applicant opts out and foregoes foreign filing, the description of the invention will end up in the public domain and accessible to competitors, whether a patent issues or not.

Furthermore, the interdisciplinary nature of nanotechnology presents a special case. The USPTO houses seven different technology centers, including the biotechnology and organic chemistry center and the chemical and materials engineering center, and various art units within each center, such as the metallurgy unit and the polymer chemistry unit within the chemical and materials engineering center, but none are dedicated to nanotechnology. This lack of focused expertise combined with the understaffed state of the USPTO is likely to result in (1) the improper rejection of patents due to a mistaken conclusion that the taught matter is not new, as well as (2) overly broad patents giving the owner excessive control over a particular area, as has happened during the recent flood of information technology patents which overwhelmed the USPTO and resulted in cases such as the “one-click” Amazon.com patent criticized as too broad and stifling. Challenging an overly broad patent held by a competitor is a costly process, while in the case of an improperly denied patent the company must spend precious time appealing the USPTO’s decision, time that could be spent taking advantage of the patent.

The USPTO has reached out to the nanotechnology community for solutions, and recently the Foresight Institute and the USPTO held a patent roundtable addressing these issues. Having a set of nanotechnology specialists within the USPTO and in communication with each other could unify prior art searches and ensure more accurate consideration of nanotechnology and related sensor technology patents and increased quality of granted patents.

Fernandez Associates LLP is a specialty patent law practice based in Menlo Park, CA.  The firm can be reached at dennis@iploft.com.