The Defense Against Trade Secrets Act: what does it means for you?
This month, President Obama signed into law the most significant trade secret reform in nearly twenty years: the Defend Trade Secrets Act of 2016 (DTSA). The Act received enormous bipartisan support, illustrating how significant this issue is to business. How does the Act impact your workplace?
Historically, trade secret protection has been the exclusive domain of the states. In fact, the DTSA does not pre-empt state law but adds an additional level of federal protection for trade secret holders. Specifically, the Act allows a federal cause of action to obtain a civil seizure order and remedies for trade secret theft. If a showing of “extraordinary circumstances” is met, a federal court can issue an ex parte property seizure—a powerful tool to stop misappropriation. The Act specifies how a trade secret threshold is met, and refers to “reasonable measures” to keep the information secret. Moreover, the Act requires the information sought to be protected derives “independent economic value” for the owner(s). The federal remedies are welcome but the burden of establishing information as a trade secret is high.
The best way to protect business secrets to avoid a breach and to seek federal and state protection after a breach is:
- Identify and continually protect trade secrets;
- Establish steps to maintain secrecy;
- Develop a comprehensive Protection Plan;
- Periodically audit your security measures.
Most importantly, the DTSA requires that employers must now provide a notice of whistle blower immunity protection in any contract or agreement with an employee (or an independent contractor or consultant).
We can help. Our lawyers have vast experience assisting businesses with trade secret matters. Contact us at email@example.com or call 508.548.4888