History of Trade Secrets
For many businesses, protecting trade secrets is important. Trade secret laws protect secret business information against unauthorized use or disclosure by one who obtains it through improper means. The protection of confidential business information has historically been protected. Protecting trade secret information dates as far back as Roman times, when Roman Law protected against the disclosure of confidential business information. Trade secret protection continued throughout time and is still protected today throughout the world.
Value of Trade Secrets
Trade secrets, confidential information and know how can be a businesses most valuable assets. Think of Coca-Cola. if anyone could steal the recipe for Coke, what would the business value of Coca-Cola be?
Costs of Trade Secrets
Unlike a patent, a trade secret does not need to be filed or approved by the government. There are no filing fees, or translation fees or maintenance fees. To protect a trade secret, the information just needs to be protected as a secret. Trade secret protection begins immediately. Unlike patent protection which requires filing an application with the government and approval by the government which can take years, once you make valuable business information a secret and protect if from disclosure it is protected under federal and most state laws.
A company may also protect its trade secrets through confidential or non-disclosure agreements (CDA or NDA Agreements). Filing a trade secret claim in the event of stolen trade secret information does not require an NDA. Legal protection of a trade secret simply requires that reasonable efforts were made to protect the information, and proof that the information was wrongly obtained.
Trade Secrets Improves Competition
In today’s world, many businesses compete in a highly competitive, fast growing environment. In many cases, being able to be first to market is the difference between success and failure. The ability to be first to market, however, can depend on the ability to maintain and protect the business information which helps you become the first to market. This can include non-public information about the people, processes, production methods, costs, distribution channels, potential customers, marketing plans and other information and know-how developed over time. Having access to this type of information would be extremely valuable to someone who wanted to bring a product to market.
Protecting Trade Secrets
Protection of trade secrets is important because trade secret protection ceases once the information is no longer maintained as a secret. However, by protecting trade secret information, a business is rewarded for its investment of time and resources, their development and research.
Protection of trade secrets probably starts with an assessment of what type of business information should be maintained as a trade secret. This can include identifying what information provides a competitive advantage and what type of information has value because it is not generally known by others. In addition, a business may want to limit access to the information so that only people who need to have access to this type of information, do.
Ultimately, a business which wants to maintain trade secret protection needs to take reasonable steps to maintain the information as a secret. This can include making sure that people who have access to trade secret information sign non-disclosure agreements, where they agree to not disclose the secrets. In some cases, this can include keeping the information in a secure location, using security methods which limit access to the information. In some cases, it may help to label or mark the information as secret information. In some cases, it may also be helpful to include information in a companies employment manuals about who and what information can be accessed or disclosed to others.
Theft of trade secret information should be taken seriously. If your information is disclosed or unlawfully obtained, you should seek assistance with an attorney who understand trade secret law. By taking a little time to understand and implement various processes and procedures to safeguard your secret information in advance, a business can secure its trade secret information for generations to come.
If you have questions about trade secrets or would like to discuss how to protect it, please contact one of our attorneys.