June 19, 2024

Obligate Law

Professional Law Makers

Trade Secrets – Revealed

2 min read
Trade Secrets – Revealed

What are trade secrets?

A trade secret is any vital business information that is not widely identified by other companies. The companies utilize this confidential information in order to gain edge from their other competitors in the business. Thus, the companies give their efforts in order to preserve its confidentiality from former employees who might violate the code of secrecy or from other business entities that might gain access through illegal means. Product designs and patterns, customer lists, instruments, formulas, pricing information, practices and programs, methods, techniques and compilations are just some of the things that can be considered as trade secrets.

How are trade secrets determined?

To determine whether information can be deemed as a trade secret, these three factors should be present in such information.

1) The information should not be widely known outside the company or by the majority of the public

2) It serves a vital role and provides economic advantages for the company

3) It has been given much efforts to preserve its confidentiality

Does the law provide any protections to these trade secrets?

Although there are no such process of trade secret registrations, most of the prevailing state laws recognize trade secret protection. Under the Uniform Trade Secrets Act, which is the basis of the majority of the U.S. states, facilitates the uniformity of state laws that covers trade secrecy. This is very much different from copyright, patent and trademark that entirely rely on federal laws.

Another important Federal law, which caused trade secret thefts or misappropriation an illegal act, is the Economic Espionage Act of 1996. This includes two statutes that 1) criminalize trade secret thefts to give advantages to foreign companies and criminalize trade secret thefts for commercial and economic benefits. Nonetheless, the penalties that come along with the violation of these two provisions vary from one another.

What types of judicial relief are entitled to successful plaintiffs?

If in any manner that the companies have proven the guilt of the defendants, the court may require the defendants to perform certain actions. The court will also furnish a declaration that the plaintiff owns the information. Finally, the defendants have to pay such amount of damages to compensate the losses of the plaintiff’s company that results to the trade secrets theft.

Do the courts allow the companies to hire the services of legal representatives?

Like in any legal proceedings, the plaintiffs are given the right to appoint their own corporate lawyers. This is to help them understand the intricate provisions of the corporate laws and defend their rights as the owners of the trade secrets. The aid of a qualified and highly skilled lawyer will boost the chances of the plaintiff in having a successful claim case.

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