Wednesday, August 1, 2012

Enforcing Trade Secret Protection

Enforcing Trade Secret Protection 

So last time I talked about what makes something a trade secret.  The next question is what do you do to enforce trade secret protection.   When someone improperly acquires, uses, or discloses a trade secret, the owner of the trade secret can sue the one who acted improperly. 

Probably the most common trade secret cases involve situations in which a trusted person discloses or uses a trade secret in a breach of confidence.  The trusted person in these cases had a duty of confidentiality to the owner of the trade secret.  This duty of confidentiality requires the person to refrain from disclosing or using the trade secret without permission.  There are several scenarios which result in a duty of confidentiality, as follows:

1- Special relationships:  these are folks who are in an employer-employee relationship, partners, joint venturers, or other types of agents.  This could also include special fiduciary relationships, such as the attorney-client relationship. 

2- Confidentiality contracts:  these are folks who expressly agree to maintain a trade secret in confidence.  These can include things confidentiality agreements, but can also include shrink-wrap licenses and lick-wrap licenses for software. 

3- Implied confidentiality contract: these folks are on notice that they are about to learn a trade secret in confidence, they agree to hear the secret, and are then deemed to have implicitly agreed to retain the information in confidence.

Next time, I'll talk about the disclosure of trade secrets by third parties.  Let me know if you have any questions.