What is a Trade Secret?
A "Trade Secret" is any information that is economically valuable because it is not generally known and not readily discovered by others using proper means and is the subject of reasonable security efforts. Trade Secret include formulas, patterns, compilations (e.g., customer and supplier lists), programs, devices, methods, techniques, and processes. It is not necessary for the information to be known to just one individual. Fort example, two or more unrelated entities could independently develop the same or similar formula, process, compilation, etc.
How do I obtain protection for a Trade Secret?
Unlike other forms of intellectual property, there is no formal process for getting trade secret protection. There is no application or registration system. If information fits within the definition of a trade secret, all that is required is that it not be generally known by those to whom it would have economic value. All that is needed to protect it is reasonable security efforts.
What kind of security is required?
Only reasonable efforts are required. This includes non-disclosure agreements with employees and contractors, need-to-know limitations on access to the information, and limitations on access to work sites. Carefully crafted non-competition clauses in employment agreements can also help prevent misappropriation. Extraordinary measures against corporate espionage are not required.
What does "misappropriation" mean?
"Misappropriation" means acquisition of the trade secret information by improper means, which includes most ways of obtaining the trade secret where the trade secret holder is the ultimate source of the information. This includes obtaining the information from a current or former employee and theft of the trade secret. It also includes obtaining the information from someone whom you know or have reason to know obtained the information improperly. Improper means does not include reverse engineering.
What can I do if my Trade Secret is stolen?
There are several potential remedies if your trade secret is misappropriated or in danger of being misappropriated. The most important thing is to act quickly to prevent or minimize disclosures. For example, injunctions are available to stop actual or threatened misappropriation. In some cases, a reasonable royalty for misappropriation that cannot be enjoined or that occurred before an injunction issued may be available. Damages may be recovered for lost profits or the defendant's unjust gain. In cases of willful and malicious misappropriation, attorney fees and punitive damages may be awarded.