James Gale was interviewed in an IAM article discussing the emerging market for trade secret insurance and how companies can use coverage to mitigate intellectual property litigation risks.

Discussing recent developments in the market, Jim noted that “over the past five years, new entrants have begun offering third-party defensive coverage for trade secret allegations,” while first-party products that compensate companies when trade secret assets are lost or stolen have also emerged. However, he emphasized that first-party coverage is “much harder to obtain” and remains expensive.

Jim also explained that insurance needs vary by industry. For example, he noted that software companies may rely on “copyright protection for their code alongside trade secret protection for the underlying know-how,” while in industries like implantable medical devices, he generally recommends “the full package: patent, trademark, copyright, and trade secret protection.”

Jim stated “the real value of insurance is often the ability to fund a defense,” noting that even policies with limits of “$500,000 or $1 million can be tremendously helpful” because they help cover legal fees during critical early stages of litigation. He additionally cautioned companies to be wary of certain litigation funding products, explaining that “abatement insurance can be risky” if policy limits are exhausted before a case is resolved.

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