Policy

Spring Cleaning: Tidying Up Your “Reasonable Efforts” to Maintain Trade Secrets

It’s among an in-house counsel’s worst nightmares. A former business partner, ex-employee, consultant, or competitor has stolen your company’s trade secret information. Company management demands swift action. You hire outside counsel who, after reviewing your company policies and interviewing stakeholders, tells you that he or she is concerned about being able to establish that your company took “reasonable efforts” to protect the information. Listening to the feedback, you realize with a sinking feeling that these were steps that you, as in-house counsel, may have been able to implement if you had only thought about the issue sooner. READ MORE

UPDATE: Home Remedies Remain Best Medicine for Politically Charged IP Theft

In July 2018, a federal judge in Wisconsin imposed a $1.5 million penaltythe maximum statutory fine—against Chinese wind turbine manufacturer, Sinovel Wind Group Co. Ltd., for stealing trade secrets from Massachusetts-based technology company, AMSC Inc. In addition to the fine, Sinovel was sentenced to 1 year probation and ordered to pay $57.5 million in restitution to AMSC, an amount the companies had settled on prior to the ruling. Sinovel also agreed to pay $850,000 to Massachusetts wind turbine operators. READ MORE

A New Month, a New Compliance Deadline in the European Union: What Businesses Need to Know About the EU Trade Secrets Directive

Just days after the European Union’s widely-discussed new data privacy regulations, the General Data Protection Regulation (“GDPR”), took effect on May 25, 2018, another EU-wide legal change quietly occurred.  (And if you’re still puzzling through GDPR compliance, fear not:  We have plenty of resources for you here.)

But on to the less familiar date:  June 9, 2018, was the deadline for EU member states to comply with the new Directive on the Protection of Trade Secrets.  As we’ve reported before, the European Parliament adopted the Directive in 2016 to harmonize national laws regarding trade secrets protection.  Under the Directive, trade secrets owners across Europe should enjoy increased protection and uniformity—welcome news, given that the laws have historically differed significantly from country to country.

New Measures to Combat Chinese Trade Secrets Theft: Will They Work?

For trade secret owners, international IP theft is of particular concern because of the difficulty in catching and enforcing remedies against the thieves.  For many U.S. companies with a global reach, an overriding concern has been how to combat economic espionage from Chinese state-owned companies or individuals.  During his campaign, President Trump certainly had China on his mind. READ MORE

EU Study: Trade Secrets Top Patents in European Union

Just as the U.S. Patent and Trademark Office has shown a keen interest in better understanding policy concerns and the needs of business stakeholders in the area of trade secrets (see our coverage of both USPTO symposia here and here) against the backdrop of a new federal law, the EU’s IP office is also stepping up its focus on trade secrets following the EU Trade Secrets Directive in 2016 (our coverage here).  READ MORE

Password Sharing Is Not a Crime, Ninth Circuit Reassures in Denial of Nosal’s Request for Rehearing

Since the early days of this blog, we’ve been covering the ongoing legal battle involving ex-Korn Ferry recruiter David Nosal as it winds its way through the courts. The latest chapter in this saga came on December 8, 2016, when a Ninth Circuit panel clarified that the Computer Fraud and Abuse Act (CFAA) does not criminalize innocent password sharing, in a published opinion denying Nosal’s request for a rehearing en banc. READ MORE

One of Obama Administration’s Final Mandates: Non-Competes Should Be The Exception, Not The Rule

With all the hubbub over the Presidential election, it would not be hard to overlook some of the Obama administration’s final moves. Recently, the White House issued a call to action to state legislators to ban non-compete agreements for most classes of workers. In an era where even sandwich makers can be bound to a non-compete agreement, the White House is concerned about the overuse of non-compete agreements and the potential stifling effect of these agreements across the economy. According to the White House, 20 percent of U.S. workers are bound by non-compete agreements, including 14 percent of those earning less than $40,000 per year. READ MORE

No Way Around It: SB 1241 Further Restricts Non-Compete Agreements For California Workers

Companies often seek to protect their trade secrets by requiring employees to sign non-compete agreements. California law invalidates such provisions except in very limited circumstances. See Bus. & Prof. Code §§ 16600 et seq. With the recent passage of a new statute, the ability of employers to enforce such agreements against California employees is more restricted than ever.   READ MORE

Senate Bill in Georgia Seeks to Expand Scope of Trade Secret Protection

On February 2, 2016, Georgia State Senator Hunter Hill introduced Senate Bill 321 in the Georgia Senate. The bill is entitled “Commerce and Trade; state government; protections against public disclosure of certain information.” The bill has 36 co-sponsors, all of whom, like Hill, are Republican.  READ MORE