REDUCING RISKS: Court Finds Copyright Act Does Not Preempt State Trade Secret Claim

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Over the years, it has proven difficult to fit software in any one category of IP protection. And while software’s ability to seemingly transcend patents, copyright, and trade secrets provides software developers and technology companies with options, it also makes it challenging to decide which will provide the best way to enforce those rights. There are obviously risks and benefits to each form of protection. However, the courts have reduced at least one risk: preemption of state trade secret laws by the Copyright Act. READ MORE

No Explicit Efforts to Maintain Secrecy? No Problem, Suggests the Ninth Circuit

14-sept-2016

In Direct Technologies, LLC v. Electronic Arts, Inc., the Ninth Circuit set forth an interesting take on what is sufficient to demonstrate reasonable efforts to maintain secrecy under the California Uniform Trade Secrets Act (“CUTSA”). In the case, plaintiff Direct Technologies, LLC asserted a trade secret misappropriation claim against defendant Electronic Arts regarding the disclosure of its usb drive prototype for Electronic Arts to a third-party. The district court granted summary judgment for Electronic Arts, finding that no reasonable jury could find that Direct Technologies had taken reasonable efforts to maintain the confidentiality of its prototype. READ MORE

Government Attacks on Non-Compete Agreements Continue

13-sept-2016

Non-compete agreements have long been used by employers as an effective tool to protect their valuable trade secrets and confidential information. However, employers’ overuse of non-compete agreements and employers’ practice of requiring all of their employees to sign non-compete agreements recently has come under significant attack by federal and state governments. In July, Trade Secrets Watch discussed some of those recent attacks. Since July, there have been a number of additional efforts by government to prohibit the overuse of non-compete agreements. READ MORE

RIGHT IN THE BREADBASKET: Lessons From Early Cases at the Intersection of Noncompetes and the DTSA

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As many TSW readers are aware, 2016 has been a big year for trade secret law, with both the United States and the European Union expanding trade secrets protections and increasing the uniformity of their laws. But as good as this year has been for trade secrets protection, it’s been every bit as bad for noncompete agreements.
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Trade Secrets v. Patents: Considerations in Choosing How to Protect Your IP

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Intellectual property owners may seek to protect certain information either by obtaining a patent or by maintaining its secrecy. A patent provides strong, exclusive rights for a fixed period of time, generally twenty years. A trade secret may last indefinitely but protection can be lost through independent development, reverse engineering, or failure to maintain secrecy. (We previously published a chart comparing the features of patents and trade secrets.) This article discusses those instances when trade secret protection may be superior to patent protection.  READ MORE

Sparks Fly in Ninth Circuit’s Nosal II Opinion

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As many loyal TSW readers know, we’ve been watching the ongoing saga involving ex-Korn Ferry recruiter David Nosal wind its way through the courts since the early days of this blog. And last month, the highly anticipated Ninth Circuit opinion in United States v. Nosal was issued on July 5, 2016 (“Nosal II”). This was the second time the Ninth Circuit had issued a ruling in the case relating to charges under the Computer Fraud and Abuse Act (the “CFAA”). In April 2012, an en banc panel dismissed five of the eight CFAA counts against Nosal (“Nosal I”). A jury subsequently convicted Nosal of the remaining three CFAA counts, as well as two Economic Espionage Act (“EEA”) counts in April 2013 and Nosal was sentenced to 366 days in prison, three years supervised release, community service, $60,000 in fines, and restitution. READ MORE

Government Involvement in Noncompetes… Against a Sandwich Maker?! Jimmy John’s Slapped With Another Lawsuit, This Time Brought by the Illinois Attorney General

27Jul16

Jimmy John’s can’t seem to escape the limelight. Last year, the company made headlines (discussed here) when employees hit it with a putative class action lawsuit seeking to invalidate their non-compete agreements. The District Court determined that the employees did not have standing to pursue their claims, and never reached the issue of whether the non-competes were valid. Just last month, the Illinois Attorney General filed suit against Jimmy John’s over the same non-compete agreements.  READ MORE

These are Not the Trade Secrets You’re Looking For: Star Wars Model Maker Sues Ex-Employees for Misappropriation

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In a tale of alleged betrayal and misappropriation of trade secrets in a courtroom (not) far, far away, a pioneering company in the area of special effects has sued its former employees and a vendor, claiming that they conspired to recreate the company’s primary business under a new name, erasing the evidence on the way out. The alleged tale is an illustration of how vulnerable a company and its trade secrets can be in times of ownership and business transition, especially when the company relies mostly on a single customer. READ MORE

Brexit’s Potential Impact for Trade Secrets in the UK

5Jul2016 (2)

To the surprise of many and the dismay of more than sixteen million United Kingdom voters, the previously unthinkable has occurred, the UK has voted to leave the European Union. In a tightly contested referendum, voters have chosen to end UK’s time as an EU member. Though the referendum is not technically legally binding, most expect the government to heed the voice of the people. READ MORE

Founding Fathers (or cases) of Trade Secret Law: A Look Back in Celebration of Independence Day

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Over the last few weeks, TSW has reported extensively on the first few cases brought under the new Defend Trade Secrets Act. But, given our recent celebration of our nation’s birthday and the day Will Smith saved the planet from alien attack, TSW takes a brief look back at the foundation and birth of trade secret law in the United States. READ MORE