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2017 could be the year of trade secret litigation

Last year, Congress addressed trade secrets by passing a new law called the Defend Trade Secrets Act of 2016. Dubbed the DTSA, this law is an added effort by the government to give companies legal options when they feel their trade secrets have been violated or used by others. Previously, companies relied on common laws and state laws to address their trade secret concerns. These laws can still be used, but the DTSA adds a federal level of legal protection to the issue.

One of the key pieces to the DTSA is that it allows the ability to seek an order of seizure for any property that is disseminating or propagating the trade secret that a company is trying to protect. This is a massive new legal tool for companies that are trying to prevent further damage to their products and business by shielding their trade secret.

If order to achieve a seizure order under the DTSA, there must be clear evidence that supports a number elements, including:

  • Other legal remedies would not sufficiently address the issue.
  • The offending property actually possess the trade secret.
  • The offending party would move to destroy or hide the evidence in light of a notice of seizure.

There are other factors as well, and the DTSA outlines them clearly. This relatively new law could spark a wave of new trade secret litigation in the coming years as companies now have added legal options to address trade secret theft or violations.

Source: Lexology, "Trade Secrets Litigation Likely to Surge in 2017 Under the DTSA," Cozen O'Connor, Dec. 30, 2016

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