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Secure your trade secrets with the Defend Trade Secrets Act

If you have been following our blog, you know that it can be tricky to keep your company's trade secrets under wraps. While they are unrestricted by the time constraints of other copyrighted intellectual property, trade secrets have their own shortcomings as their profitability can be negatively impacted by informal manner in which they are protected. If you own a large company where many employees are familiar with the aspects that make your trade secret unique, you may find it difficult to ensure that this information remains within your company. Seminars on the importance of employee discretion may assuage some concerns, but lectures alone may not prevent a disgruntled individual from misappropriating the business practices that make your company successful.

With the recent passage of Defend Trade Secrets Act, however, your ability to protect your business's trade secrets has strengthened. Here are ways in which this new legislation shores up support for those defending trade secrets:

1. Uniformity of federal application

Previous to enacting DTSA, companies filed civil trade secret cases in state courts. Excepting New York and Massachusetts, the remaining 48 states adopted their own versions of the Uniform Trade Secrets Act. While the UTSA helped to protect the sanctity of trade secrets, the fact that each state enacted its own variation of the legislation created inconsistencies in how these business practices were defended. That the DTSA has been passed on the federal level ensures companies will not have to worry about discrepancies of its application across state lines.

2. Efficiency in legal proceedings

While the DTSA does not prevent the individual states' interpretations of the UTSA from being enforced, the new legislature does provides the opportunity for businesses to present their claims in federal court rather than on the state level. Typically, federal courts have fewer cases pending in their docket than do those on the state level, an element that could limit time spent in litigation.

3. Protection through ex parte seizure

In order to protect plaintiffs from suffering from profit loss due to the misappropriation of a trade secret, the DTSA allows the claimants to request stolen intellectual property be seized without giving notice to the defendant. This procedure is helpful in situations in which it is possible that papers or evidence would be destroyed had the defendant been given advanced warning.

There are many protections now afforded under the DTSA. If your company has trade secrets it seeks to secure within its walls, it is beneficial for you to review the guidelines provided in this act. Your future profits may depend on it.

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Robert Kaufman has been selected as a 2013 Top Rated Lawyer in ‘Commercial Litigation’ as will be published in the May issue of The American Lawyer & Corporate Counsel magazine.Alex Kaufman has been selected as a 2013 Top Rated Lawyer in ‘Commercial Litigation’ as will be published in the December issue of The American Lawyer & Corporate Counsel magazine.

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