Trade Secret Misappropriation Laws

Misappropriation is the improper acquisition, disclosure or use of a trade secret. Under trade secret law, misappropriation, not infringement, is the main reason for a lawsuit. 

What Is “Improper Acquisition”?

Improper acquisition occurs when you get a trade secret by using improper means. The means do not have to be criminal to be improper, although criminal means are almost automatically improper means. Sometimes, even legal actions can be improper. Some common types of improper acquisition means are:

  • Theft
  • Bribery
  • Misrepresentation
  • Breach or encouraging someone else to breach a duty to maintain secrecy
  • Spying through electronic or other means
  • Industrial espionage

Are There Ways to Acquire Trade Secret Information That Are Not Improper?

There are many ways to acquire trade secrets that are not considered improper under trade secret law. Some commonly accepted ways are:

  • Discovering the trade secret independently
  • Discovering the trade secret through reverse engineering
  • Obtaining the trade secret from a publication
  • Seeing the item publicly used or displayed

What Is Improper Disclosure or Use?

Improper disclosure or use is the disclosure or use of a trade secret, without the express or implied consent of the trade secret owner, by a person who:

  • Acquired the trade secret through improper means
  • Knew that the information was acquired wrongfully
  • Knew that he should be under a duty to maintain secrecy

Is It an Improper Disclosure to Disclose a Trade Secret to Someone Who Will Not Use It?

Even if the person you disclose a trade secret to has no intention of using or disclosing the trade secret, you may still have made an improper disclosure. The value of a trade secret depends almost entirely on secrecy. Without that secrecy, a trade secret is useless and unenforceable. Telling just one person can destroy a trade secret. 

If I Use Information I Learned at a Prior Job, Can I Be Liable for Improper Use of a Trade Secret?

If you use information you learned at a prior job, you may be liable for improper use of a trade secret. Of course, you can use the skills, knowledge, and experience you acquired at a former job, but it may be difficult to draw the line between this type of employee knowledge and the knowledge of trade secrets. For example, even if you do not take any tangible information about a trade secret, like a customer list or a formula, if you have that list or formula memorized, and use it at your next job, you may be liable for trade secret misappropriation. 

Do I Need a Lawyer?

If you believe you may be guilty of misappropriation, or if you have questions about what constitutes misappropriation, you should consult with a lawyer experienced with trade secrets. An intellectual property lawyer will be able to inform you of your rights and let you know if there are any defenses available to you. On the other hand, f you believe someone has misappropriated your trade secret, you should consult with a lawyer to determine what your rights are. If necessary, a trade secret lawyer can represent you in court.

Last Modified: 2018-07-04 00:34:34

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