Uniform Trade Secrets Act (UTSA)
Many states in the U.S. have enacted their own respective versions of the UTSA.
California's version begins at California Civil Code Section 3426. Under California's statute, a "trade secret" means information, including a formula, pattern, compilation, program, device, method, technique, or process that:
derives independent economic value (actual or potential), from not being generally known to the public or to other persons who can obtain economic value from its disclosure or use; and is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.Trade Secret vs. Patents
If an invention cannot be easily discovered by another, consider maintaining the invention as a trade secret. If an invention can be easily discovered or reverse engineered, consider applying for a patent.How to Protect Valuable Confidential Information
- Do not disclose the information to anyone. Maybe, with a signed non-disclosure agreement. Still, only disclose to those that have a legitimate need to know.
- Take reasonable measures to maintain secrecy.
- Computer firewalls, encryption, other electronic measures.
- use secure email options.
- Avoid wireless communication. Consider encrypted wireless communications.
- Keep records on recipients of confidential information and identify what exactly was disclosed.
- Have visitors sign log when visiting premises.
- Use non-disclosure agreements.
- File patent applications before any public disclosure, if patent application is planned.
- Maintain UTSA protection for subject matter not claimed in a patent application.
Federal Economic Espionage Act
The Economic Espionage Act of 1996 (the "EEA") makes criminal two types of misappropriation.
(1) Trade secret thefts to benefit a foreign government or foreign agent (18 U.S.C. Section 1831(a)); and
(2) thefts for economic advantage, regardless if a foreign entity is involved (18 U.S.C. Section 1832(a)).
The EEA not only criminalizes confidential information theft, but also makes illegal knowingly receiving, buying, destroying, or possessing a stolen trade secret.
Even attempts and conspiracies to perform the illegal acts are in themselves criminal acts under the EEA..
The EEA's definition of a trade secret is based on the definition provided under the UTSA.
Examples
Software used in the lumber industry - Rivendell Forest Prods., Ltd. v. Georgia-Pacific Corp., 28 F.3d 1042, 1046 (10th Cir. 1994).
Engineering drawings and measurements to manufacture an aircract brake assembly - United States v. Lange, 312 F.3d 263 (7th Cir. 2002).
Information on manufacturing contact lenses - Syntex Opthalmics, Inc. v. Tsuetaki, 701 F.2d 677, 684 (7th Cir. 1983).
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