Guidline:
You are not a lawyer, and are not expected to have definitive answers to legal questions. You are supposed to be a manager with educated instincts about
legal problems, including an understanding of broad legal doctrines, the ability to spot where legal issues will have an impact on a business arrangement and
the individuals involved, and the ability to evaluate in a preliminary way how legal considerations shape risks and opportunities. You are asked below to
address legal issues in a business context from the point of view of a manager. You should in your Response Memo show that you understand general legal
principles and can apply them to specific facts.
Background:
IDS’s main product is a scanner that produces cross-sectional images of vein patterns beneath the skin’s surface. Finger vein patterns require especially
sensitive readings. IDS is working on a new model that will be even more sensitive and that will likely significantly improve reliability rates of its
authentication technology.
IDS has also been trying to build a relationship with Dr. Ethan Hunt at International Medical Foundation (IMF). Dr. Hunt is a leading authority on biometric
technology in the medical field.
IDS’s main competitor is IronClad Security, a California manufacturer. IronClad has never marketed a scanner designed specifically for finger vein patterns.
However, IronClad has recently brought out a new model of its general use scanner, and it is a big advance. Some experts are saying it might be a substitute
for the current IDS machine, and IDS is worried that it might even be as good as the newest IDS scanner that is still in the development stage.
IDS would like to get a good look at the new IronClad machine, but IronClad sells machines only to health care providers under contractual arrangements that
discourage resale, so there is no secondary market. IronClad would not sell a machine directly to IDS.
Ms. Brand came up with the idea of entering into a contract with IMF and Dr. Hunt for a “sponsored research project.” The contract for the project provides
that IDS will make payments to IMF for a total of $1 million, and IMF will use some of those funds to purchase the latest model IronClad machine for use in
Dr. Hunt’s research at IMF. Dr. Hunt’s lab already has an IDS machine, and IDS technicians are frequently in Dr. Hunt’s lab. Under the terms of the sponsored
research contract, Dr. Hunt will give IDS access to “all research data” (including data from IMF relationships with third-parties). Ms. Brand is hoping that IDS
technicians will get a good look at the new IronClad machine.
Question:
What kinds of intellectual property protection would best protect IDS?
