Last night, at dinner with friends, I had the opportunity to speak with a young man who has just completed his second year of studies in mechanical engineering.

I mentioned that this fall I will be speaking to a class on Technology, Globalization and Culture at Iowa State, and I asked my student friend what he thought the students would like to hear about in the context of inventions, patents, and global competition.

My young friend said he’d like to hear about collaboration versus competition.

Should companies collaborate—play nice in the sandbox—or stay in their own silos?

A central question is how much of a contribution one makes to a field of technology. And how much should an inventor and his or her company be rewarded in sales, profits, and ownership of the new technology.

It’s a good topic. Here’s a case study. It’s a classic situation of a company going to a vendor to fill a particular need.

Some years ago, I represented a company that created the field of truck restraints. Semi trucks, or 18 wheelers, have a bar at the back known as an ICC bar. It’s in the position of a rear bumper.

When a semi truck is loaded or unloaded at a warehouse, it floats down or up, respectively, by several inches. A fork lift drives in and out of the semi on a steel dock leveler. You don’t want the semi to drive or coast away from the dock during that operation. The truck restraint is basically a hook that catches the ICC bar and holds the semi in place for as long as needed. But it needs to allow for float. So the truck restraint company went to a control systems company and asked for a system that would raise the hook when a gap is detected and allow slip, via a clutch, when needed.

No problem—all in a day’s work—”routine skill” is the term in patent law—for a control systems engineer.

Some months later, we learned that the control systems company had filed a patent application claiming the new truck restraint. But they didn’t invent it. Our client did. We filed our own patent application and provoked an interference. The control systems company did not contest our claims, so we obtained the patent instead of them getting it.

This kind of thing happens a lot.  You’re building a better mousetrap. You go to a vendor for a particular part or subsystem. When you succeed, who is the inventor? Who is the owner of the technology? Those questions can be hard to sort out.

Here are two camps. One is the sandbox. Engineers like to play in the sandbox. It’s all for the common good, they say. So they play nice. But it ends in a fight.

Another camp is the silos. Lawyers like silos. We’ll play in our own silo, they say. We won’t ever let down our guard. We won’t play with anyone. But those engineers end up stymied, because they don’t get the specialized help they need.

A better way

Before you go to a vendor, document your development of the technology to date. Mark your documentation “confidential.” Provide the vendor with an agreement providing for confidentiality, non-competition, and ownership of intellectual property (IP) rights (or IPRs). Spell out the terms of the business arrangement before you start working together.