Can You Keep a (Trade) Secret?

I’ve previously written in this blog about the importance of trade secrets. See: Protecting Your Trade Secrets in the US. Some recent changes in US Federal trade secrets legislation will help Irish and Northern Irish companies better protect their trade secrets in the US.

“Trade secrets” are defined in the US as (i) information, including a formula, pattern, compilation, program, device, method, technique, or process; (ii) that derives independent economic value, actual or potential, from not being generally known to or readily ascertainable through appropriate means by other persons who might obtain economic value from its disclosure or use; and (iii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

The Defend Trade Secrets Act of 2016 (the “DTSA”), signed in to law last week, permits businesses, including Irish and Northern Irish parent companies and their US affiliates, to take more decisive and effective action to deal with actual or threatened theft or disclosure of their valuable trade secrets. Specifically:

  • The DTSA allows businesses to file trade secret claims in federal court.
  • The DTSA allows court-ordered seizure of property.
  • The DTSA allows wide-ranging injunctions and damages against defendants.
  • The DTSA adds protections for employees and whistleblowers related to trade secrets, and a new requirement for employment agreements. The DTSA updates and strengthens the federal criminal provisions pertaining to trade secret theft.

If you want additional information on this legislation, my partners Scott Taylor and Andrew Flake have written a great client alert, available here. It is well worth a read.