Trade Secrets

For many people, “trade secrets” is a term reserved for the information kept in locked vaults at multi-million dollar companies. However, this is not the case – small businesses also have what are considered trade secrets. Depending on the circumstances, customer lists, business plans, spreadsheets, corporate minutes and agendas, and bid specifications can all be considered trade secrets; anything that is not intended for public knowledge is a trade secret. Companies may require employees to sign non-disclosure agreements when it comes to some pieces of information, but the agreement might also be verbal.

partnershipshareholderclaims againsttrade secretsThere are several means by which an individual can take and/or share trade secrets unlawfully. A common way that this happens is by obtaining trade secrets by “improper means.” This includes theft, bribery, and even espionage. Another way trade secrets are unlawfully shared is via the misappropriation of information. This includes situations such as an individual using the knowledge without the expressed permission of another, and an individual acquiring information from someone knowing that the information had come as a result of improper means.

No matter the scale of the information or the means by which it was taken and shared, all types of trade secrets are protected under the Uniform Trade Secrets Act (UTSA) of California; the UTSA ensures that business owners are protected as long as a company takes reasonable precautions to the prevent the theft of their trade secrets. Without proof of having taken preventative measures, an individual has no case for seeking damages.

When filing a claim against an individual, it is important that the individual are able to clearly identify the trade secrets were. It is also important that they can demonstrate the relevance of this information as it relates to the company’s operations. It is more difficult to prosecute an individual for stealing trade secrets in California than it is in other states, and having this information is one way to build a stronger case against the defendant.