Disclosure of Trade Secrets in Trade-Secret Litigation: A Frequent Catch-22 [ABA Section of Litigation]

Your client comes to you (usually late on a Friday afternoon) with a problem. A competitor is using your client’s trade secrets. How did the competitor learn the secrets, if they are in fact secret, and if in fact your client has taken commercially reasonable precautions (as all clients must) to protect those trade secrets, you ask. The usual answers are either that a former employee joined the competitor and brought a thumb drive with him or her, or the competitor received the trade secrets under a confidentiality agreement and is now violating that agreement. In the “olden days,” employees could only take paper copies of documents with them when leaving one employer for another. Not only did this limit the amount of information they could take, it was obvious if an employee was trying to leave with ten boxes of paper. Today, a lifetime’s work product can fit on a thumb drive the size of a car key. It is not practical to try and “frisk” departing employees to see if they are carrying thumb drives. It is also not practical to prevent employees from downloading (or emailing) information. After all, that is how business is done today. It may, however, be practical to lock down what are really a company’s “crown jewels,” and keep them from being copied or emailed.

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Aaron Krauss



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