9 surefire ways to protect trade secrets



Most States in the United States have enacted some sort of Trade Secrets Act. A trade secret is private and confidential information: A formula, a method, a process, a program, or a technique. There is usually some economic value for the trade secret and perhaps gives the company an edge over their competition: Coke vs Pepsi for example. The Uniform Trade Secrets Act (UTSA) protects trade secrets from misappropriation. However, if the trade secret was found independently, reverse engineers it through non-trivial and non-criminal efforts, and it is obtained legally then the company is not covered. Which is when the adequate protection is needed.


1. What exactly needs to be protected? This can be a challenge in a large company so being exact is absolutely mandatory. No confusion should be made about what needs to be protected. A system must be in place when new information is added to the trade secret information. Do not trivialize the protection of trade secrets.


2. Label documents or information that is to be protected. Information that is considered part of the trade secret should be labeled confidential. This information at a minimum should be controlled when distributed. This can be done by limiting copies and controlling when they're out and back in and controlling who is allowed to handle the information.


3. Monitor the storage of such information. You must know where it is stored and who has access to it. This includes hard copies and computer storage. Look for the weak spots and provide protection for those weaknesses.


4. Secure computer systems. This is a no brainer but you'll be surprised how easy this is but doesn't get done. A surefire way to lose trade secret information. Clearly the computer should be password protected especially when containing sensitive information. If it is a laptop then it is easy to get stolen so make sure there is a protection method to prevent entry.


5. Maintain secrecy with outside vendors, visitors, or guests. In fact make it a habit not to talk to anybody about sensitive and confidential information. If outsourcing is necessary for maintenance or other jobs by outside vendors try and use different vendors, in other words don't use the same vendor all the time.


6. Provide adequate and efficient security. Locations such as certain rooms can be staffed by security personnel. Consider security zones or access badges. If the information is important enough to protect then it is also important enough to be monitored by a camera system.


7. Public access should be limited. Curb public tours, monitor all guests by issuing certain badges or signing in a book with verification of identification.


8. Be cautious when travelling internationally. Not all countries respect the laws regarding confidential information and they simply may not care. If you are travelling internationally, it goes without saying, be very careful who you are disclosing information to. If you are not ABSOLUTELY sure who they are do not provide the information.


9. Lastly, make sure employees are trained on handling confidential information. Make sure that all employees understand the policy on handling such information. If information is mishandled counsel or discipline the employee immediately. If an employee is exiting the company then conduct an audit. All confidential materials must be returned and a Non-Disclosure Agreement should be completed. Have a lawyer check the wording on the document if you are unsure.


The courts want you to have the proper protective measures in place. If the company shows that they are making every attempt to protect the trade secret the court will be more sympathetic in their case during court proceedings if necessary.


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