Trade Secret Disputes & Protection

A Trade Secret is any business information not generally known to others. It may be customer, prospective customer or supplier identity; information about sales, revenue or profits, technical information such as formulas, systems, methods or operations; and business plans and projections. Maintaining a Trade Secrets program is easier said than done; all you have to do is keep it a secret.

Protecting against trade secret misappropriation claims is very important to the survival of a business. Businesses make substantial investments in research and development that can be rendered wasted when confidential information and know how can be freely employed by competitors. That can happen if such information is not properly handled.

Trade secret protection sometimes is more desirable than patents or other forms of intellectual property protection; unlike patented inventions, confidential business information and know-how can be owned perpetually if kept secret. Trade secret protection is also often a preferred where a patent would be difficult to enforce.

Problems commonly faced by businesses include the misappropriation and unauthorized disclosure of trade secrets by former employees, vendors, contractors and competing businesses. Protection of trade secrets embodied in computer programs is often an important part of an intellectual property protection program.

The usual steps taken to protect these trade secret rights include the use of employee agreements with confidentiality restrictions, non-disclosure agreements with vendors, third party developers and licensees, distribution of the software in executable form only and heightened security of storage areas for trade secrets.

The U.S. Copyright Office has specifically recognized the importance of trade secrets in computer programs and has promulgated regulations that provide for several deposit copy options that involve the submission of only a portion of the entire code.

We assist clients in identifying their important trade secrets and in establishing a comprehensive trade secret protection program that meets the requirements of trade secret law.

A protection program usually includes the establishment of in-house procedures for handling trade secrets; preparation of appropriate employment policies, including agreements with key employees; preparation of suitable confidentiality agreements, with developers , consultants and manufacturers.  We can also analyzes the potential for adverse claims of trade secret misappropriation and advises on appropriate courses of action, including for example, the development of parallel technologies using “clean room” techniques, the negotiation of a license to use competing technology, or the use of public domain technology to avoid trade secret claims. In appropriate circumstances, we can develop a licensing-out program or negotiate the sale of commercially marketable trade secrets under favorable terms.

The protection of client trade secrets and the avoidance of infringement of the trade secrets of others are important aspects of the firm’s practice.