The 2016 Federal Defend Trade Secrets Act put federal trade secret protection on par with that for other intellectual property, like copyrights and patents, but without requiring registration or disclosure. The number of state and federal lawsuits using the Act increases dramatically each year. As with other business issues, preventing litigation is usually better than having to prosecute or defend it. Some ways to avoid trade secret litigation include:
- Determine, define and describe what constitutes your trade secrets.
- Identify and inventory your trade secrets, as well as where they are kept and how they are accessed and protected from disclosure.
- Implement and enforce written policies and procedures with acknowledgments from employees, consultants, contractors and others.
- Have those who access, use or create trade secrets sign non-disclosure, confidentiality, non-competition or other protection agreements.
- Limit, monitor and record access to and use of your trade secrets.
- Conduct exit interviews that document post-relationship trade secret protection, acknowledge post-relationship obligations and identify risks.
- Periodically, with promotions and at contract renewals and amendments, re-emphasize and re-document the protection of trade secrets.
- When hiring and contracting document trade secret protection, certify that new employees/contractors are not restricted by prior agreements, and prevent new hires/contractors from improperly bringing/using third party trade secrets.
- Document new product/service development and engineering.
- Take reasonable steps to address breaches and rectify deficiencies of protection.
The Act places the burden on your business to not only prove that the information constitutes a trade secret, but also that you took all reasonable steps to protect it, even with contractors and employees working remotely. As we have substantial experience protecting trade secrets and handling litigation over trade secrets, please call us with any questions or issues.
