Regulation

Russian Perspective: Can Sending Confidential Information to Your Personal Email Address Constitute a Disclosure of a Trade Secret?

Imagine that you are the General Director of a company (the Russian equivalent of an American CEO), and your information security department finds out that an employee, who you have long suspected of industrial espionage, has sent important confidential information belonging to the company to his personal email address. In that situation, what would you do? Would you (a) do nothing for the moment and wait until you have more definite proof of industrial espionage; (b) make the employee tell you why he sent the information to his personal email address; or (c) dismiss the employee? Clearly, you need to find out who the information is being sent to and maintain your reputation for enforcing the rules.

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New Opposition to the EU Trade Secrets Directive

Not everyone is happy about the proposed EU Trade Secrets Directive.  When we last touched on this topic a couple of months ago, the European Union looked poised to enact a sweeping new legal regime that would harmonize trade secrets law across all member states.  The new framework was supposed to be a single, clear, and coherent legal regime for the protection of trade secrets.   And it was aimed at making it easier for national courts to deal with the misappropriation of confidential business information, remove trade-secret-infringing products from market, and facilitate compensation for illegal actions. READ MORE

CONTINENTAL SHIFT: EU Advances Legal Regime Protecting Trade Secrets

The European Union appears poised to enact a sweeping new legal regime that would harmonize trade secrets law across all member states.

It’s been a year since we wrote about a new EU proposal to regulate trade secret protection. Then, at the end of November 2013, the EU published its first draft proposal for a Directive on the protection of trade secrets.In May of this year, the Council of the European Union agreed on a revised draft Directive. (In contrast to European Regulations, European Directives do not apply directly as member states’ law, but only give objectives that the Member States must achieve within a specified time limit in order to harmonize their various national rules. This means that, in fact, trade secrets rules will not be “unified” but rather “similar” across the Continent.)

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RUSSIAN WEAPONS: New Amendments to Russia’s Trade Secret Law Target Thieving CEOs and Workers

New amendments to Russian law take aim at the theft of trade secrets by employees, with especially tough penalties for thieving CEOs.

The amendments to Russia’s Trade Secret Law became effective October 1, 2014. The goal of these amendments is to increase the protection of trade secrets by stiffening penalties for unauthorized disclosures by employees.
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New CA Law Gives Refineries Broad Authority to Designate Maintenance Records Trade Secrets

Ah, what would corporations give to be able to have trade secret protections for their information simply by declaring it a trade secret? For oil refineries in California, that dream may now be a reality.

On September 20, 2014, Governor Brown signed Senate Bill 1300 into law. The bill requires oil refineries in California to report information about all scheduled shutdowns and other maintenance for the upcoming calendar year to the Division of Occupational Safety and Health by September 15 of each year. The bill also expands the definition of trade secrets as it applies to oil refineries and permits oil refineries to identify as trade secrets “all or a portion of the information submitted” under the bill if they believe that the information “may involve the release of a trade secret.”
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The House Introduces Another Trade Secrets Bill: Is It Really Any Better Than Before?

The Trade Secrets Act of 2014 (H.R. 5233) was introduced in the House by Congressman George Holding on July 29, 2014.  Representatives Steve Chabot (R-OH), Howard Coble (R-NC), John Conyers (D-MI), Hakeem Jeffries (D-NY), and Jerrold Nadler (D-NY), are cosponsors of the bill.

While the House Bill is very similar to the Bill introduced in the Senate on April 29, 2014 Defend Trade Secrets Act of 2014 (DTSA) (S. 2267), there are some major differences between the two.  Specifically, the House Bill is much more protective of defendants facing ex parte seizure orders. READ MORE

North Carolina Enacts Criminal Penalties for Disclosure of Fracking Trade Secrets

North Carolina is officially open for fracking, after lifting a ban on the practice—and enacting criminal penalties for spilling trade secrets associated with it. With passage of the Energy Modernization Act, North Carolina joins the growing ranks of states that have legislated to protect confidential fracking information.

North Carolina’s new law prompted us to update our chart summarizing the key provisions of similar legislation in other states. It can be seen hereREAD MORE

DESPITE THE CHEERS, THE DEFEND TRADE SECRETS ACT BILL HAS HOLES: What’s a Plaintiff to Do if It Passes?

State court or federal court?  If the Defend Trade Secrets Act of 2014 (DTSA) (S. 2267, introduced on April 29, 2014) becomes law, then trade secrets plaintiffs—not just those who can maintain diversity jurisdiction—could proceed in federal court under new federal law.  But would they want to?  While the knee-jerk reaction of many litigants is a resounding “Yes!,” we wonder whether federal court under the DTSA would be preferable to the well-known Uniform Trade Secrets Act (UTSA), which is available in forty-eight of the fifty states.

Let’s first look at where DTSA and the UTSA appear the same or similar.  Both statutes provide nearly identical definitions of trade secrets and misappropriation.  Both also offer similar remedies for injunctive relief, actual damages, unjust enrichment, reasonable royalties, punitive damages, and attorneys’ fees. READ MORE

UPDATE: BACK FROM THE DEAD: Senators Resuscitate Legislation to Create a Federal Right of Action for Trade Secret Theft

With a powerful industrial coalition lining up behind them, two senators are trying yet again to establish a federal right of civil action for trade secret misappropriation, potentially making trade secrets an IP stepchild no more.

Sens. Chris Coons (D-Del.) and Orrin Hatch (R-Utah) introduced the Defend Trade Secrets Act of 2014 on April 29.  As we reported in February (and as picked up today by the LegalTimes), Sen. Coons was then circulating a draft; by recruiting Sen. Hatch as a co-sponsor, he can now tout the bill’s bipartisan support.  Moreover, both are members of the Senate Judiciary Committee, which might help the bill’s odds of survival. READ MORE

Pyrrhic Victory For Parties Seeking Fracking Fluid Disclosures

Parties advocating public disclosure of the chemical makeup of fracking fluids may have won a recent battle in Wyoming, but are they losing the war?  On March 12, 2014, the Wyoming Supreme Court in Powder River Basin Resource Council v. Wyoming Oil and Gas Conservation Commission reversed a district court’s order exempting fracking fluid information from public disclosure.  The court made two key findings.  First, the court clarified that parties seeking disclosure in Wyoming are entitled to de novo district court review of administrative decisions exempting fracking fluid information from disclosure as trade secrets.  Second, it held that the “narrow” definition of trade secrets under FOIA applies to exemption claims. READ MORE