Revised post available here.
There are stirrings in the U.S. Senate of yet another bid to establish a federal right of civil action for trade secret misappropriation.
Sen. Chris Coons (D-Del.) has quietly circulated a draft bill to IP lawyers and others with an interest in the legislation. The draft Protecting American Trade Secrets and Innovation Act of 2014 (“PATSIA 2014”) is the latest of several recent attempts to bring about this right. The past attempts include Sen. Coons’ own prior iteration of the bill, PATSIA 2012 (S. 3389), which never made it out of the Senate Judiciary Committee.
Like the earlier version of the bill, PATSIA 2014 would allow American trade secrets owners to sue misappropriators in federal court for what would for the first time constitute a violation of federal law. The bill tracks the Uniform Trade Secret Act’s definitions of “trade secret” and “misappropriation,” includes standard remedies of damages and injunctive relief, and enables courts to seize property involved in the commission of the misappropriation.
PATSIA 2014 is broader than the prior version of the bill. In the latest version, plaintiffs no longer would need to include in their complaint “a sworn representation . . . that the dispute involves either substantial need for nationwide service of process or misappropriation of trade secrets from the United States to another country,” which was a significant limitation of the prior version of the bill. Further, the bill now covers the misappropriation of a trade secret that is “related to or included in a product, process, or service used in, or intended for use in, interstate or foreign commerce” (emphasis ours), as opposed to only a “product that is produced for or placed in interstate or foreign commerce.” This language mirrors the amendment Congress made to the Economic Espionage Act in 2012, when it changed the EEA’s definition of misappropriation in the same way. Congress made the EEA amendment to close a loophole created by the Second Circuit decision United States v. Aleynikov. PATSIA 2014’s definition of misappropriation is consistent with the amended EEA and keeps the loophole closed.
We’ve been tracking the raft of proposed trade secrets laws for much of the last year. Here, we update our primer to include Coons’ new bill. We’ve also updated the chart to include bill numbers and links to status information via www.govtrack.us, and to reflect what our sources on Capitol Hill tell us about the prospects for these bills:
|Bill||Sponsor||What’s It About?||Status|
|Sen. Chris Coons (D-Del.)||
||Not yet introduced. Senator Coons has asked interested parties for comment on a draft.|
|Sen. Jeffry L. Flake (R-Ariz.)||
||Referred to the Senate Judiciary Committee|
|Rep. Zoe Lofgren(D-Cal.)||
||Referred to the House Committee on the JudiciaryThe bill has no co-sponsors, so action any time soon is unlikely.|
|Rep. Zoe Lofgren(D-Cal.)
||Referred to the House Committee on the JudiciaryLawmakers have not agreed on whether the bill’s approach is the right one, so its prospects are uncertain.|
|Rep. Mike Rogers (R-Mich.) and Rep. Tim Ryan (D-Ohio)||
||Referred to the Foreign Affairs, Judiciary and Financial Services CommitteesNot scheduled for any hearings at this time; prospects uncertain.|
|Sen. Carl Levin (D-Mich.) et al.||
||Referred to the Committee on FinanceSenate is obliged to take action first, and has not.|
|Rep. Marsha Blackburn (R-Tenn.)||
||Referred to the House Subcommittee on Crime, Terrorism, Homeland Security, and InvestigationsLawmakers have not agreed on whether the bill’s approach is the right one, so its prospects are uncertain.|
|Rep. Mike Rogers (R-Mich.) et al.||
||The bill passed the House and was referred to the Senate but has not shown signs of advancement. We reported earlier that the Senate would not be taking up the bill and that President Obama threatened to veto the bill because of privacy concerns.|