Trade secrets are at the heart of most successful businesses, giving them a distinct advantage over competitors. This value is precisely why trade secrets are often the target of thieves or disgruntled employees.
When it comes to protecting your company should something go wrong, it’s vital you proactively do one key thing: treat your trade secrets like secrets.
Keeping Trade Secret Information Secret
California offers a specific definition of what constitutes a trade secret. The secret must be some type of information – such as a technique, process, formula or program – that:
- Is not generally known by the public
- Derives value from the fact it isn’t widely known
- Its owner takes steps to protect
It’s that last bullet point that can get companies in trouble.
The World Intellectual Property Organization recounts a case in which a former employee of a bookkeeping company was charged with violating trade secrets. They claimed the former worker was inappropriately using the company’s client lists. The case was dismissed, however, when it was discovered those same client lists were often available for anyone to see. They were left visible on desks, saved on computers many people used, and even placed in areas where the public and maintenance staff could see them.
Accordingly, be able to demonstrate that company safeguards are in place and enforced to keep trade information secret.
It’s vital that companies take steps to actively protect trade secrets – not just in the event of a court case, of course, but also to ensure this information does not fall into the wrong hands. This could mean:
- Labelling related documents or items as “top secret”
- Restricting access to the information
- Setting up non-disclosure agreements and other protections with vendors
- Developing an employee training plan
- Securing computers that hold the information
By prioritizing the secrecy of trade secrets, you can help protect yourself and your company.
What if trade secrets get out?
Unfortunately, sometimes a trade secret leaks or is taken from the company. In these cases, your best next step is likely legal action. A successful lawsuit might lead to damages for any economic harm, an award for attorneys’ fees and injunctive relief. Intellectual property laws are complex, especially in the digital age, but protecting your rights is possible.