U.S. Considers Sanctions Against China For Cyber Hacking And Trade Secret Misappropriation

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You may have missed it this past weekend, but reports indicate the United States is considering sanctioning Chinese companies and individuals who have benefited from their government’s alleged cyber hacking of U.S. trade secrets. The Washington Post, quoting unidentified officials, states the “unprecedented” package of sanctions is part of a larger strategy to expand the “administration’s public response to the rising wave of cyber-economic espionage initiated by Chinese hackers” and to confront malicious cyber actors. READ MORE →

Throwback Thursday: Why Trade Secret Theft Isn’t Just a Digital Problem And What Businesses Can Do About It

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With stories of cyberattacks and data breaches on a seemingly endless loop, businesses and governments have been doubling down on their efforts to protect digital information and assets.  But, in some industries, the greatest threat might still be a pair of quick hands.  For instance, in the restaurant industry, opening the kitchen doors to a new employee creates real risks.  As we’ve discussed, sometimes the decision whether to print or download can have major legal ramifications.  And with computer forensics technology growing in leaps and bounds, sometimes an old-school paper trail might be more enticing to would-be perps than a digital one.  That said, the FBI has a track record of turning up bags of shredded documents in grocery store dumpsters. READ MORE →

The New and Improved Defend Trade Secrets Act of 2015! Now Featuring a Lockbox

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On July 31, 2015, TSW continued our reporting of the continuing saga of Congress’ attempts to establish a federal right of civil action for trade secrets misappropriation by covering the introduction of the “Defend Trade Secrets Act of 2015” (“2015 DTSA”). The 2015 DTSA was introduced in identical form in the House (H.R. 3326) by Rep. Doug Collins (R-GA) and in the Senate (S. 1890) by Sen. Orrin Hatch (R-UT). In prior posts, we covered the introduction of the Defend Trade Secrets Act of 2014 in both the House (the “2014 House Bill”) and the Senate and outlined the differences between the two, noting that the 2014 House Bill was much more protective of defendants facing ex parte seizure orders. READ MORE →

A Preview of the CFAA Arguments in United States v. Nosal, Part II: Could “Phishing” be a Factor?

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Oral arguments for the next round in United States v. Nosal have been set for October 20, 2015 at the Ninth Circuit in San Francisco.  So we figured it may be a good time to review both sides’ arguments related to the Computer Fraud and Abuse Act. After doing so, it seems to us that one topic not given any consideration in the briefs, but that may play a role during oral argument is the phenomenon known as phishing schemes, and how such schemes might be compared and contrasted with the scheme alleged in this case. READ MORE →

A Voice from China: Unraveling the Different Standards for Civil and Criminal Misappropriation of Trade Secrets

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In China, victims of trade secret misappropriation suffering losses over RMB 500,000 are entitled to file a civil action and may also report the case to public security authorities to initiate a criminal investigation. (For more of our coverage about trade secrets protection in China, click here). When both criminal and civil actions are pending, a Chinese criminal court tends to use the civil decision, if available, as the basis of proving the crime of trade secret misappropriation as long as the damages requirement is met. In Maige Kunci Co., Ltd. v. Suzhou Ruitai New Metal Co., Ltd. (regarded as one of the top 10 Chinese IP cases in 2014) READ MORE →

Once More, With Feeling! Congress Swings for the Fences with the Defend Trade Secrets Act of 2015

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On July 28, broad bipartisan support ushered the “Defend Trade Secrets Act of 2015” onto the floor of both the House and Senate. This DTSA treads the well-worn path of many similar (and, to date, hapless) bills that fruitlessly preceded it. TSW has exhaustively covered prior attempts, aptly titling our first post “Pols Gone Wild: Congress Discovers Trade Secret Theft and Cybersecurity Are Problems; We Sort Through the Explosion of Legislation”—chart and all. READ MORE →

Fifth Circuit Revisits Copyright Preemption of Trade Secret Law

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The United States Court of Appeals for the Fifth Circuit recently revisited the issue of the Copyright Law preemption of trade secrets claims in Spear Marketing, Inc. v. Bancorpsouth Bank. The decision not only resolved the scope of Copyright Law preemption in the Fifth Circuit, but also made clear that the Fifth Circuit “join[s] the majority position” to hold that state law claims based on ideas fixed in tangible media are preempted by §301(a). The decision creates greater clarity and uniformity in Copyright Law preemption and should help litigants avoid wasting resources by filing actions based on state law claims that are preempted. READ MORE →

Hacking Your Rivals – Corporate Espionage in Major League Baseball

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As we approach the dog days of summer, baseball season is again in full bloom. We previously discussed old-fashioned sign stealing in the context of teams trying to gain a competitive advantage during an actual game. But it appears these hijinks have evolved in today’s electronic world. As the New York Times first reported, the FBI and Department of Justice prosecutors are investigating front-office personnel for the St. Louis Cardinals, one of Major League Baseball’s most beloved franchises, for allegedly infiltrating the internal network of the Houston Astros. READ MORE →

One Step Closer: European Parliament Legal Affairs Committee Approves Trade Secret Directive

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As Trade Secrets Watch has previously reported, new rules regarding the protection of trade secrets are on the horizon for the European Union. In November 2013, the European Commission announced a proposed Directive on trade secrets and confidential information. Around six months later, in May 2014, the Council of the European Union agreed on a revised draft Directive. Reception of the Trade Secrets Directive has been mixed. READ MORE →

For Here or To Go? Senators Introduce Bill to Ban Noncompete Agreements, Increase Mobility For Sandwich Makers and Other Low-Wage Workers

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Congress is getting into the non-compete business.  Citing the use of non-compete agreements by companies such as Jimmy John’s sandwich shops, Senate Democrats recently introduced a bill—called the Mobility and Opportunity for Vulnerable Employees (MOVE) Act—that would amend the Fair Labor Standards Act (FLSA) to prohibit the use of non-compete agreements for low-wage employees. READ MORE →