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How can we legally protect software? Who owns the exploitation rights? The developer?
How can we legally protect software? Who owns the exploitation rights? The developer?

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The increase in the use of technologies, and the inventions and developments stemming from their growing application in our daily lives, raises many questions related to the legal protection and exploitation of the rights attached to these intangible assets.

Software, the different assets it can integrate and the ways to protect each of them, give rise to many questions among developers and companies. Our experts have therefore drawn up a guide withkey questions related to their protection and the answers to each of them.

1.Which elements of the software can be protected, and by which means?

Software is composed of many elements: source code, artificial intelligence models, administrator’s guides, technical and functional program designs and architectures.

In addition, there are other elements that are not software per se but have a high business value, either because they allow building the software, testing it, maintaining it, etc. (Functional requirements, which contain valuable business information, algorithms, data used to test use cases, maintenance methodologies, testing, code compilation, etc.)

All elements are susceptible to be protected by trade secrets as long as they provide a competitive advantage to the holder by keeping them secret.

As regards Intellectual Property, it protects, on the one hand, the program code (source code and object code), the preparatory documents (the diagrams and schemes relating to the structure and features of the program) and the technical documentation and user manuals (which explain to the user what the features of the program are and how to execute them).
On the other hand, graphical user interfaces, content (videos, images, photographs, music, etc.) presented to the user of the software, or databases it may contain, can also be protected in this way (although not as software, but as independent elements).

Another route of legal protection for software is the patent. As far as Intellectual Property is concerned, the patent system establishes that technical solutions to technical issues can be patented, as long as they meet the requirements of novelty, inventive step and industrial applicability.

This route establishes a scope of protection, i.e., protects a set of variations that goes beyond the preferred implementation of the software itself (several different computer programs that carry out the set of steps defined in the patent claims).

In the field of inventions related to software development, patents are generally granted for methods and systems that reflect the set of stages the software goes through during its operation and the elements that carry out these stages. These inventions are known as computer-implemented inventions and, in this case, they must contribute at least one feature that is considered to be technical, new and inventive.

2. When protecting the source code of a computer program by secrecy, should open source be avoided?

There are hundreds of different open-source licenses. Those commonly known as copyleft require anyone who uses components under these licenses in any way to make the source code of the software they have developed available to anyone to whom they distribute a copy of the software. But this is not true in all cases.

For this reason, when using open-source components in developing your own software, it is advisable to consult an expert on the obligations that may arise from the use of such licenses before starting development or in the early stages of development.

3. When carrying out an open-source development project, are Intellectual Property rights waived? And what about the Trade Secret protection?

When a company chooses to exploit a certain software under an open-source license as a business strategy, it allows the rest of the community to use the program under certain conditions, but this does not imply a waiver of any Intellectual Property rights that may apply to that program.

On the other hand, as far as Trade Secrets are concerned, the elements with business value linked to software are not reduced to source code only. Maintenance methodologies, requirements, manuals, etc. may remain confidential despite the release of the source code, so it is highly recommended that the company take the necessary technical, physical, legal and organizational measures for the adequate protection of these elements.

From an Intellectual Property point of view, the patent system does not exclude the possibility of exploiting the patented technology through different types of licenses, including the use of open-source licenses, on an exclusive basis or in combination with other types of licenses. Nevertheless, it is important not to release sensitive information or grant permissions for software development before the patent application for software development has been filed.

4. What needs to be taken into account regarding Intellectual Property and Trade Secrets in the development of software where it is necessary to outsource the development service?

It is important for companies that provide development ideas, functional requirements (list of needs to be met by the planned software) or other business information necessary for the development, to ensure that this information is adequately protected by non-disclosure agreements that prevent its use by the developer for any purpose other than the agreed development. It is also very important that the documents containing the information are adequately identified with non-disclosure notices.

On the other hand, from the copyright perspective, it must be borne in mind that the fact of commissioning a third party to develop the software and paying them for it is not sufficient to presume there has been a transfer of all the rights to the software commissioned.
For this assignment of rights to take place, and to control its scope (which specific rights are assigned, for which territories, for how long, etc.), an assignment of rights agreement must be signed between the software developer and the company that commissioned the software (principal).
These agreements may include warranty clauses, provisions for the transmission of source code and sometimes even obligations for the maintenance or correction of errors in the program commissioned.

5. The law states that one of the legitimate ways to obtain a Trade Secret is by reverse engineering. Does this mean that anyone can decompile software?

No. While someone who holds a software license can study the principles and rules behind how the software works, within the limits established in the license, decompiling the object code/executable to access the source code -which is a different activity- is not quite the same.

Also, from an Intellectual Property perspective, decompiling a program’s code without the consent of the rights holder is a risky activity, which shall only be lawful if very strict requirements are met. These requirements are linked to the need to achieve interoperability of that software with another computer program.

In any case, if the aim is to keep the source code secret, the license terms must always include a prohibition on decompiling except in cases expressly permitted by law(interoperability).

6. How does reverse engineering affect patent-protected software?

Patent law establishes a commitment between the patent applicant and society whereby applicants undertake to disclose their development in sufficient detail so that it can be reproduced by a person skilled in the art, contributing their knowledge to the state of the art, and in return receive protection in the territories of their choice for 20 years, during which only they shall be able to exploit the patented technology.

Therefore, publishing the patent application provides all the details that could be obtained by reverse engineering.

Likewise, any person or company attempting to exploit a protected invention infringes patent rights regardless of whether they used the information in the patent application publication to reach that solution or not, unless they prove that they reached that solution prior to the application being published and without knowing about the making of the patent application.

7. Given that a software is protected by Intellectual Property Rights, are the algorithms implemented in the software also protected?

Although algorithms are programmed in the software code, since they are mathematical expressions, they are not subject to Copyright protection. Therefore, if there is any technical, commercial or other advantage in using them, they should be kept secret.

To this end, both technical code protection measures and physical, legal and organizational protection measures shall be implemented to enable the organization to maintain control over the algorithms.

The specific programming language used, the software functionalities or the ideas and principles behind the software are not protected by Intellectual Property either.

In the case of Intellectual Property, the patent system does not protect the ideas and principles behind the software, its functionalities or the specific programming language used. Instead, a set of embodiments of the invention defined by a set of claims is protected, which can be generalized as long as the requirements of novelty and inventive step continue to be met in all embodiments that remain protected.

8. When licensing software in on-premise mode, how can you prevent users from decompiling software?

Distributed software repositories are the most widely used in recent times. This provides advantages in development (such as flexibility), but it is also a challenge in terms of controlling information, especially in an industry marked by high turnover rates.

In these cases, a series of measures can be adopted to mitigate the risks derived from the use of this type of repository: signing strict non-disclosure agreements together with the developers’ employment contracts, marking source code files, keeping logs of developer activity, including watermarks in the files, etc.

9. If the source code and all software documentation is available through a git-like distributed repository for the entire team of developers, how can the risk of leakage be avoided?

Distributed software repositories are the most widely used in recent times. This provides advantages in development (such as flexibility), but it is also a challenge in terms of controlling information, especially in an industry marked by high turnover rates.
In these cases, a series of measures can be adopted to mitigate the risks derived from the use of this type of repository: signing strict non-disclosure agreements together with the developers’ employment contracts, marking source code files, keeping logs of developer activity, including watermarks in the files, etc.

10. In a development project involving several entities, how is know-how protected? Once created, who is the owner of that software?

First, it would be highly advisable to establish proof of the existence of the know-how before sharing it (so that you can prove that it was in your possession before you shared it). Second, always sign a proper non-disclosure agreement before sharing the information. Third, you should properly document what information you share and with whom. Finally, be diligent upon completion of the project to have partners return the information that has been shared or ensure that it is properly destroyed.

It is crucial to draft non-disclosure agreements appropriately, so it is recommended to rely on an expert in the field for this task.

On the other hand, it is also highly advisable to sign, from the beginning of the collaboration, an agreement reflecting the purpose of the developments to be carried out within the framework of the project.
This agreement will establish who will own the developments, indicating, where appropriate, the ownership percentages of each party. And in this case, the operating rules of the partnership over the shared asset can be included (who decides how the software is to be used, how the profits obtained are to be shared, etc.)

11. Can a pure software development, where the hardware is irrelevant or widely known, be patented?

Software patentability is not determined by the existence or absence of associated hardware, but by the presence of at least one feature that can be considered technical, novel and inventive.
In some cases, where software interacts with hardware, it may be the case that the technical, novel and inventive feature is directly related to the hardware. However, there are examples of patented solutions that are developed without specific hardware, using only a general-purpose computer.
Therefore, the patentability analysis of a software development has to be carried out on a case-by-case basis depending on the experience gained in the field of patent protection.

12. When should software be patented?

The best time to patent a new development should be determined on a case-by-case basis.
However, an invention can only be patented when it is sufficiently developed to be fully described in the patent application.

It is advisable not to disclose any aspect regarding the invention before applying for a patent, as in many developments, especially in the field of software, details of the invention are disclosed at stages before the final product development is completed.

For this reason, the right time to file for patent protection of software is before the final product development has even been completed, provided that sufficient information is available to describe the development in a reproducible way. In this case, it is essential to delay the publication of results.

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