Legislation aims to create federal civil remedy for victims of interstate or foreign trade secret theft.
While federal laws apply to patents, trademarks, and copyrights, up until recently, the federal government has pretty much overlooked domestic trade secret theft, leaving this area up to the individual states to regulate. Most states have adopted some version of the Uniform Trade Secrets Act, but this Act does not provide for civil remedies.
In the wake of recent high-profile corporate espionage cases, such as the sale of trade secrets to China by DuPont employee Walter Liew, trade secret theft law has caught the attention of federal lawmakers. There are now two pieces of legislation pending on this issue at the federal level. The first is the Defend Trade Secrets Act of 2014, which was introduced in April, and the second is the Trade Secrets Protection Act of 2014, which was introduced in July.
Both of these bills would provide a federal civil remedy for companies harmed by trade secret theft—but only when that theft is related to a product or service related to interstate or foreign commerce. The remedy could include damages as well as ex parte orders to seize property used to commit the theft.
The inclusion of damages is important because the theft of company secrets has the potential to seriously harm a company by destroying their competitive advantage in a market. As many business owners and companies have discovered, trade secret theft laws sometimes offer more meaningful protection than patent law or other remedies.
Often, the very act of applying for a patent sets the stage for a loss of competitive advantage because companies must disclose certain proprietary information in order to secure the patent, opening up their invention for copying. Another benefit is that while patents expire, a trade secret lasts forever.
What does all this mean for individuals accused of trade secret theft? In a nutshell, it means you need an excellent trade secret theft attorney now more than ever. The patchwork of state laws applying to trade secret theft continues to be confusing to navigate, and if federal legislation permitting civil remedies is adopted, matters will only become more complex. Individuals could potentially be exposed to federal and state civil and criminal penalties in the course of their case.
If you have questions about trade secret theft and California or federal law, please do not hesitate to contact Chambers Law Firm for help.
