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Trade Secret Concepts for Daily Operations

Trade secrets are the most common in daily operation comparative to the others in the intellectual property.

POME details you the basic components of the trade secrets, how it is vital in the daily operations life.

Defining characteristics
A trade secret is a type of intellectual property that is useful to its Project. It can take many different forms such as business plans, customer lists, software programs, formulas, recipes, manufacturing techniques, specifications, and designs. It always has three defining characteristics:

 

Advantage: It provides the Project with an actual or potential competitive advantage in the marketplace.

 

Secrecy: It is not widely known in the marketplace, by competitors, or by the general public.

 

Security: The Project must take reasonable precautions to maintain its secret status - ensuring physical security, taking legal precautions, creating employee awareness, and ensuring that only those who need to know the secret, know it.

 

A trade secret is less formal than other types of intellectual property. It does not have to be registered with the Patent and Trademark Office (PTO) like a patent does. Nor does it have to meet the stringent requirements of originality that a patent must meet.

A trade secret is really a "do-it-yourself" form of protection. The main requirement for the Project of a trade secret is to use whatever means are necessary to protect its secrecy.

 

Trade secrets and other forms of intellectual property
Apart from trade secrets, there are other forms of intellectual property such as trademarks, copyright, and patents. A trademark is a name or symbol identifying a product, which is officially registered and legally restricted to the use of the Project or manufacturer. Copyright is the legal right granted to the creator or publisher to exclusive publication, sale, or distribution of a literary or other creative work. These two types of intellectual property don't have much in common with trade secrets, as in most cases they don't benefit the Project until they are made public. It's more useful to compare trade secrets with patents.

In many cases, information can be treated either as a trade secret or as a candidate for patenting. So it's worth comparing them to see which approach is more appropriate in any given circumstances.

A trade secret is a form of intellectual property like a patent, but it differs from it in a number of important respects.

A trade secret can, if it is properly protected, survive for many decades. This is in contrast with a patent, which is protected for a fixed number of years (generally ranging between 14 and 20, depending on the type of patent) and which cannot then be renewed.

A trade secret is not registered with any government body, whereas patents are registered with the Patent and Trademark Office.

A trade secret need not be considered novel or unique, but a patent has to meet some exacting requirements to be registered. In particular, it has to be considered both "novel" and "nonobvious."

Trade secret laws
Every state has enacted a law prohibiting the theft or misuse of trade secrets. In most states the law is derived from the Uniform Trade Secrets Act (UTSA). This is the most important law protecting trade secrets in most U.S. states. The UTSA was drafted by the National Conference of Commissioners on Uniform State Laws in 1970 and amended in 1985.

 

The concept of trade secrets is somewhat hazy to many people. The UTSA dispels this confusion by providing a concise definition of a trade secret. The UTSA defines a trade secret as: "information, including a formula, pattern, compilation, program device, method, technique, or process, that:

(i)           derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and

(ii)           (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy."

Confusion also arises when people use different terms to describe trade secret abuses - theft, misuse, abuse, and so on.

 

The central concept, however, is "misappropriation." The UTSA defines "misappropriation" as acquisition of a trade secret of another by a person who knows that the trade secret was acquired by improper means, or disclosure or use of a trade secret of another without express or implied consent.

The UTSA defines "improper means" to include "theft, bribery, misrepresentation, breach or inducement of a breach of duty to maintain secrecy, or espionage through electronic or other means."

The UTSA provides a variety of remedies for infringement of trade secrets. These include damages, royalties, profits, injunctions, and the provision of attorney's fees.

In addition to the UTSA, another important legal protection for trade secrets is the Economic Espionage Act of 1996 (EEA), a federal law that gives the U.S. Attorney General sweeping powers to punish individuals or companies involved in the misuse of trade secrets. The intentional stealing or misappropriation of trade secrets can lead to severe punishments. Individuals may be imprisoned for up to ten years and fined up to $500,000. Corporations may be fined up to $5 million.

Benefits
Trade secrets provide important benefits to both large and small businesses. The main benefit of a trade secret is that it gives its Project a competitive advantage in the marketplace. The trade secret itself can come in many different forms, but as long as its Project protects its secrecy, it will continue to deliver the benefits while being protected by law.

Trade secret protection is immediate, and it does not require registration (and consequent expense). These benefits are particularly important for smaller companies with limited budgets.

Trade secret protection can last indefinitely. This benefit can be enjoyed by both large and small companies. For example, the recipe of Coca-Cola is a trade secret that has been protected for over 100 years. The world has changed immeasurably in that time, yet this is still the world's leading soft drink brand. Also, small family-owned businesses have maintained trade secrets for decades, deriving substantial benefits from them.

Trade secret protection provides a benefit to a company in cases where it is not possible to gain protection using other forms of intellectual property. For example, trade secrets can be as varied as customer lists, marketing plans, manufacturing processes, and designs. In many cases it would not be possible to protect these with other legal approaches such as a patent.

 

Trade Secret Project/ Operations Rights

 

One of the most important rights of a trade secret Project is the ability to prevent certain groups of people from exploiting those secrets. These groups include the following:

• People who have signed NDAs
• Employees (including key employees)
• Employers who obtain trade secret information from ex-employees of competitors
• People who obtain a trade secret through theft or espionage

People who sign nondisclosure agreements (NDAs) promise not to divulge trade secret information without permission of the Project Sponser/ Operations Manager/ Decision Maker. Many companies now have independent contractors working for them - such contractors do not owe a duty of confidentiality to the company employing their services. Therefore, to protect trade secrets, it is now standard practice for companies to require these contractors to sign an NDA. It is both common and good practice to also get employees with access to such information to sign NDAs.

Employees are bound by a duty of confidentiality not to reveal anything of value to competitors or anyone else who can damage the business. All employees are bound by this duty, and it applies whether or not they have signed NDAs.

There is an even stronger duty of confidentiality applied to key employees such as top executives, researchers, and so on. This is called a "fiduciary duty." In cases of misappropriation, judges take a very poor view of its abuse.

A company that employs a person who has worked for a competitor is not entitled to exploit trade secret information such an employee may have gained in his previous employment. This is because the trade secret information is considered the property of the previous employer. It doesn't matter if the employee had worked on, gathered, or developed any of this confidential information. The trade secret belongs to the former employer, and the new employee still owes them a duty of confidentiality.

Anybody who hires a person who has worked for a competitor should always be aware of situations where she would be breaking trade secret law, and act appropriately in the Projects.

No one is entitled to acquire trade secret information through theft, bribery, or certain forms of industrial espionage. The Project of a trade secret will have a clear-cut case against anyone who uses these methods, if the misappropriation can be proved.

There is one group of people who cannot be stopped from using information protected as a trade secret. If someone discovers the secret independently, without using any illegal method as described in the relevant laws, she is free to use the information. For example, it is not a violation of trade secret law to analyze a lawfully obtained product and, by so doing, to determine any trade secrets used in its manufacture. This process is called "reverse engineering."

 

Protecting Trade Secrets

 

 

Potential problems that may occur
If a company fails to take steps to protect its trade secrets, it is likely to lose them and the commercial advantages they deliver. If a competitor acquires the confidential information, it could gain market share at the expense of the company who originally had the trade secret. Alternatively, trade secret information can simply become public knowledge. In this case the company still suffers because it has lost control of the information that gave it a competitive advantage.

The single most effective method to enforce trade secret confidentiality is to get all relevant people, whether or not they are employees, to sign a legally binding nondisclosure agreement (NDA). Failure to do this often leads to the loss of trade secrets, especially in cases where a person has no duty of confidentiality to the Project of the secret.

If an employee is not aware that he actually has trade secret information, it is quite possible that he could inadvertently reveal such information to competitors or the general public. An important part of protecting trade secrets is to raise employee awareness of the issue, and make sure confidential areas and documents are clearly identified and labeled as such.

No company can guarantee that all of its employees will be happy at work. Occasionally, disenchanted employees will actively try to harm the company. One way of doing this is by revealing confidential information. The best protection against this is to have a comprehensive program to protect trade secrets. It's important that employees have access to confidential information only on a need-to-know basis. In the event of trade secrets being divulged, this makes it easier to pinpoint the perpetrator of the leak.

Practical steps to protect trade secrets
There are many practical steps that can be taken to protect trade secrets:

• Identify confidential material clearly.
• Limit people on a need-to-know basis.
• Use NDAs or other appropriate agreements.
• Maintain appropriate physical security.
• Maintain appropriate computer security.
• Conduct exit interviews.

Companies should regularly conduct audits to determine what information is to be regarded as confidential. This should then be clearly labeled as confidential, highly confidential, top secret, and so on.

Companies should grant access to trade secret information on a need-to-know basis. That is to say, employees should only have access to confidential information if they need it to do their jobs. Manufacturing processes with sensitive areas should be "compartmentalized." This reduces the danger of an employee or contractor passing on a substantial amount of information to a competitor, and damaging the company's business. Another advantage of compartmentalizing information in this way is that, if trade secret information is misappropriated, it makes it easier to trace the source, and increases the chances of a successful legal action.

Using nondisclosure agreements (NDAs) or other appropriate legal agreements is one of the most effective actions that a company can employ to protect its trade secrets. Even though employees are bound by law to protect the confidentiality of their employer's trade secrets, it is still a good idea to get employees with access to such information to sign NDAs.

Maintaining appropriate physical security is an important part of protecting trade secrets. This can take many different forms, depending on the nature and size of the business. Confidential documents should be locked away when not in use, and signed out when needed. Access to sensitive areas can be restricted to appropriate personnel, using swipe cards or security guards. Closed-circuit television (CCTV) and other electronic surveillance systems may also be used.

Because information technology (IT) is now so integral to most businesses, it is very important that appropriate security measures are applied to all computers and networks used. Sensitive information should only be accessible to employees who need it, and passwords should be changed regularly. Extreme care should be taken when networks are connected to the Internet, due to the dangers of hackers gaining access. Up-to-date firewall and anti-virus technology is vital. A small company may not have the IT resources to effectively protect its network from the many possible dangers. It may be necessary to outsource this work to a reputable IT company if internal resources are insufficient.

An employer should always conduct an exit interview with a departing employee who has worked in a sensitive area. It is a good opportunity to remind the employee of obligations imposed by any NDAs signed, and to clarify what is, and is not, regarded as trade secret information. It is also a good idea to have a similar interview with a contractor who is ending a relationship with the company.

 

 

Types of Trade Secret Agreement

 

Three types of trade secret agreement
There are three main types of trade secret agreement:

1. Nondisclosure agreements,
2. Noncompete agreements, and
3. Nonsolicitation agreements.

 

1. A nondisclosure agreement'also called an NDA or confidentiality agreement'is a contract in which the parties promise to protect the confidentiality of secret information they learn during employment or another type of business transaction. NDAs can be used to protect any type of trade secret or confidential information. For example, a nondisclosure agreement can prohibit someone from disclosing a secret invention, an idea for a new marketing campaign, or confidential financial information. NDAs are particularly important for independent contractors and consultants, as these people do not owe a duty of confidentiality to a company. NDAs may be the only way to guarantee confidentiality in such cases. Sometimes, an employee or independent contractor is so important to an employer that her departure'particularly to work for a competitor'would cause a great deal of harm. In such a situation, an NDA will not be sufficient to protect the business. Instead, the employer should ask, or require, the worker to sign a

1. A noncompete agreement. This takes nondisclosure one step further by prohibiting the worker from performing services for a competitor (or competing directly) for a specified period of time after leaving the company. Noncompete agreements are not enforceable against employees in certain jurisdictions, and an employer may have to use a combination of NDAs and nonsolicitation agreements instead.

 

1. A nonsolicitation agreement is an agreement in which the worker promises not to solicit clients or customers, for her own benefit or for the benefit of a competitor, after leaving the company/ Project. A nonsolicitation agreement can also contain a promise by the worker not to solicit fellow employees to leave with her if she quits. A nonsolicitation agreement may be part of a larger employment agreement such as a noncompete agreement or NDA. But it doesn't need to be. If a company doesn't care about an employee competing against it but just wants to avoid losing customers and clients, a nonsolicitation agreement alone may suffice.

What NDAs can protect

ü   Nondisclosure agreements can be used to protect a very wide variety of confidential information. Everything from business strategies to physical devices can be considered as a trade secret and protected by an NDA. At the same time, there are situations where confidential information can not be protected by an NDA. And there are some cases where information may or may not be protected, depending on the circumstances.

ü  Many processes, such as chemical and manufacturing processes, are considered trade secrets and can be protected by an NDA. Formulas and recipes are also often considered trade secrets and can similarly be protected. For example, the formula for Coca-Cola and the recipe for Kentucky Fried Chicken are trade secrets protected by NDAs.

ü  Physical devices and machines can be protected by NDAs if they are maintained as trade secrets. This may be the only way to protect them if they do not satisfy the requirements for a patent to be granted. Even if the option exists to protect such objects using a patent, they can still enjoy trade secret protection while waiting for the patent to be granted. Designs and specifications can be protected as trade secrets. For example, a complex manufacturing device could be protected like this, especially if the design is not unique enough to warrant a patent.

ü  Business strategies such as advertising and marketing campaigns can be protected by NDAs. Business plans and announcements of new products can also be protected by this method. A business method--a particular and well-developed way of conducting business--can be treated as a trade secret and so protected by NDAs.

ü  "Rebranding" is now commonplace in business. Companies and products can be rebranded to enhance their appeal and win new customers. In the leadup to the launch of the new brand, confidentiality is vital, and often protected by NDAs.

ü  Companies often consider their customer lists to be a valuable asset and treat them accordingly. They are generally considered trade secrets and so are protected by NDAs. However, they are often a point of contention when an employee leaves, starts up a new business, and approaches clients known from the old company. If such a situation ends up in court, the judge has to decide if the customer list truly qualifies as a trade secret. If the information on the list is very detailed and not readily ascertainable, it's likely the judge will rule that it is, in fact, a trade secret protected by an NDA.

What NDAs can't protect

ü  There are some cases where an NDA cannot protect a trade secret. For example, if the Project of a trade secret does not employ all reasonable means to protect it, then protection is lost. Another case is where the information is generally known in the marketplace, or is otherwise ascertainable.

ü  Another case where trade secret protection does not apply is where the confidential information has been discovered independently by another party. Consider the case where the formula for a shaving product is protected as a trade secret. The ingredients involved are widely known, but their relative proportions are not. In this case, it is quite possible that a competitor's research could independently discover the composition of the product. In this situation the trade secret is lost.

ü  It is also possible to lose trade secret protection if a competitor "reverse engineers" a product. Reverse engineering is the methodical analysis of a product that is available to the public, with the intention of discovering how it is made, even if that involves discovering trade secrets that had been used.

Limitations of NDAs

 

• There are a number of important limitations that apply to nondisclosure agreements: they can't be unlimited in scope, they must be properly drafted, they must be "supported by consideration," and they only take effect on execution.
• The NDA defines the scope of the information that is protected. It does not specify exact details--this would be placing too much confidential information in a legal document which others outside the company might see. Instead, it describes the types of information and work areas that it expects the employee to keep confidential. The NDA also defines the types of information that are specifically excluded from its scope. The NDA specifies the time period over which it expects the employee or contractor to keep information confidential.
• An NDA must be properly drafted by a person with suitable legal experience. While a standard NDA is appropriate in many cases, there are certain well-recognized variations that apply to specific situations. The most common NDA is one that an employee signs to protect the employer's trade secrets. But there are others who need to sign NDAs and the document should be drafted to take into account the many different roles in which confidentiality is required. Specific roles where the NDA should be tailored to particular requirements would include (but not be limited to) independent contractors; vendors; legal, technical, and financial consultants; and financial investors.
• An NDA usually includes miscellaneous provisions. These standard provisions (sometimes known as "boilerplate") are included at the end of most contracts. These provisions are important and can affect how disputes are resolved and how a court enforces the contract.
• An employee should be offered something in return for signing an NDA. In legal terms, it should be "supported by consideration." This could be a pay raise or a promotion for an existing employee, although simply moving to a new area where confidentiality is required could be considered a benefit. For a new hire, the consideration might simply be the offer of new employment.
• An important limitation of an NDA is that it only takes effect on execution. It cannot apply retroactively--that is to say, it cannot apply to any information that the employee or contractor has previously divulged.

Benefits of NDAs

 

• Trade secret protection can be very beneficial to a business, but it's a somewhat informal type of intellectual property. Getting an employee or contractor to sign a nondisclosure agreement is one way to formalize certain aspects of it, and guarantee the benefits of trade secret protection to the company.
• Using NDAs shows that an employer takes the business of protecting trade secrets seriously. This is a very important point when trade secret disputes arise.
• An NDA defines exactly what information is regarded as a trade secret and is to be kept confidential. In many cases, even management might not be sure what types of information, technology, and know-how constitute valuable trade secret information. Having to examine and define the specific areas the company wants to be kept secret is a useful exercise in itself, as it shows where extra security may be necessary.
• An NDA can specify dispute resolution methods such as arbitration or mediation that are to be used in the case of a dispute later on. This can reduce the possibility of expensive litigation proceedings.
• The employee has an implicit duty of confidentiality to the employer. However, she may not be fully aware of this fact, or all its implications. An NDA makes explicit this duty of confidentiality. Ideally, this will also have the beneficial effect of enhancing an employee's awareness of security and confidentiality issues on a daily basis, all through her employment by the company.

 

Resolving Trade Secrets Problems

 

Trade secret misappropriation
Trade secret information is considered a form of valuable property and is protected by relevant laws. There are certain activities that the courts will treat as trade secret misappropriation, which means that the Project will be afforded judicial relief such as damages or injunctions.

The courts will treat as trade secret misappropriation any disclosures by key employees in violation of their duty of trust toward their employer. Such employees would typically include current and former managers, research scientists, and engineers. Disclosure of confidential information by current and former employees who have signed a nondisclosure agreement with their employer is also considered trade secret misappropriation.

There are often many people providing services to a company. These include independent contractors or consultants, financial advisers, and vendors. Very often they need to know confidential information to perform their roles. If such people sign a nondisclosure agreement, and then go on to misuse confidential information, this is considered trade secret misappropriation.

The courts will treat as trade secret misappropriation any time that a company or person deliberately gains access to someone's trade secrets through illegal means such as bribery or certain forms of industrial espionage.

Situations can arise where trade secrets are accidentally lost. The Project of a trade secret is expected to take "reasonable precautions" to protect confidential information. But sometimes a sequence of events happen, that are entirely unforeseen, that cause a trade secret to be lost.

If such a sequence of events happens, and no person was willfully negligent in what happened, the trade secret is lost but no misappropriation has occurred.

Steps to take if problems arise

 

v  If an employer suspects that an important trade secret has been divulged to a competitor by someone who owes a duty of trust, be that person a current or former employee, or an independent contractor who has signed an NDA, then a certain set of steps can be taken to resolve the problem.

v  The first step an employer should take when trade secret misappropriation is suspected is to get a good attorney. An experienced attorney can advise on how to proceed with the next step, which is the investigation and gathering of evidence. An attorney can provide an independent perspective, and advise of possible risks in the investigative process.

v  The second step is to investigate and gather evidence about the means of misappropriation. How did the secrets leave the business? Was information passed by e-mail or in conversation? Were physical documents stolen or copied? The investigator should inspect relevant company files to determine if any documents are missing. Investigation is very important. If an employer makes false or unprovable statements that damage a person's reputation, he may be liable for defamation. That's why professional input into the investigation can be very beneficial.

v  The third step is to decide what legal claims to make. In order to put a halt to a disclosure'either through negotiation or litigation'the lawyer will need to show that the employer has solid grounds for a lawsuit against the person who violated the NDA. One legal claim that can be made is that the person has committed breach of contract. In addition, the attorney must determine whether there are other grounds on which to sue, such as misappropriation of trade secrets, or breach of fiduciary duty.

v  The fourth step for the employer is to determine what has been lost and what they are prepared to do about it. How has the trade secrecy loss affected business? This must be known in order to figure out what to get from the perpetrators. For example, if the employer had intended to patent an invention, disclosure of confidential information may have eliminated this possibility.

v  When considering what to do about a trade secret misappropriation, it's useful to consider what stage the misappropriation is at. In a "threatened misappropriation," no damage has been done but a threat has been identified. In this case, the trade secret has not yet been divulged. For example, an employee is found with unauthorized documentation. A written request to return the material might work; failing this, a court order might be necessary.

v  In a "continuing misappropriation," damage has been caused but the trade secret rights may not be lost completely. In this case, damage has been done. A competitor may have unlawfully acquired a trade secret, but not yet exploited it. A court order can be obtained to prevent its unauthorized use, and possibly some compensation could be claimed.

v  In a "completed misappropriation," the damage is complete and irreversible. In this case, trade secret information has been lost irretrievably. For example, a competitor has gained and fully exploited another's trade secrets. In this situation a lawsuit should be filed and payment of profits sought.

 

Hiring employees from competitors
Hiring someone who has worked for a competitor and who, most likely, has had access to the previous company's trade secrets places the new employer (or more usually, the new manager) in a problematic situation. There may be compelling reasons to hire the employee, but it places definite obligations on the manager to handle this employee carefully, so that trade secret law is not broken. The manager has no right to access trade secrets that rightly belong to the previous employer.

When placed in the difficult situation of managing such an employee, a manager has to put themselves "in the shoes" of the new employee to try to understand how to avoid compromising situations. The manager should also think of the position of the former employer. The objective of this exercise is to avoid, intentionally or otherwise, breaking trade secret law.

Practical steps
It can be difficult for a operations manager/ Project sponser to think of things from the new employee's perspective. However, there are a number of practical steps that can be taken. For example, the manager should clarify with the employee the terms of any NDA (or any other agreement) she may have signed with her previous employer.

The manager should explain to her the legal obligation she is under not to abuse her former employer's trade secrets. She may not be aware of all the legal obligations, or she might be aware but be careless or thoughtless about the issue. This is a good opportunity to review (or explain) the concept of intellectual property, and point out the substantial penalties that can be imposed for its misappropriation.

The manager should determine, in general terms, the sensitive areas in which she previously worked, and relate them to similar areas in the current operation. This will give an idea of where not to deploy her.

Another good idea is to contact former employers to determine the trade secret issues which are at stake. This is useful if the employee was not properly briefed at the exit interview, or if there was no such interview. It might even be possible to determine ways in which both former and new employers could agree to compromise on certain trade secret issues in a way which is mutually beneficial.

An employee, in general, spends more time working with colleagues than with his or her manager. It's all very well if the manager understands the implications of an employee revealing trade secrets learned from a previous employer, but this could be useless if another employee succeeds in coaxing such information from the new employee. All employees should be aware of the damage that can be done if trade secrets are misappropriated.

The successful employment of people who have worked for competitors depends, to a large extent, on all employees--colleagues, managers, and new hires--being aware of the importance of trade secret and intellectual property issues.

Resolving trade secret disputes
There are four main methods of resolving trade secret disputes:

1. negotiation,
2. mediation,
3. arbitration, and
4. litigation.

 

• Direct negotiation between the two parties in a trade secret dispute is often the best way to find a resolution, especially if the misappropriation has been discovered at an early stage. Many settlements are made after a cease-and-desist letter has been delivered or a lawsuit has been threatened. Most companies want to avoid the expense and bad publicity of litigation. While negotiation is often the best way to resolve a trade secret dispute, it still usually involves intense discussions between the parties and their lawyers. The process is similar to contract negotiation, with offers and counter-offers being made until agreement is reached. When this happens, a lawyer drafts a settlement contract that sets out details of payments, return of documents, possible royalty arrangements, and all other pertinent matters.

• Mediation is an informal process in which an impartial third party, the mediator, assists both sides in the dispute to reach an agreement. Sometimes the use of mediation is stipulated in nondisclosure agreements. Mediation is a good way to resolve trade secret disputes as it is inexpensive and allows the concerned parties to resolve the dispute themselves.

 

• In arbitration, an impartial third party negotiates with the two sides and delivers a ruling on the dispute. This ruling is usually final and binding. Again, a nondisclosure agreement can specify the use of arbitration. This method can also be used even while litigation is proceeding--if it is successful, the litigation can be dropped.

• Litigation should be the final resort in trade secret disputes. It is an expensive, complex, and time-consuming process. Even in small cases, legal fees can be between $100,000 and $200,000 per party. Large cases that proceed to a verdict can cost many millions of dollars. Trade secret disputes can take years to resolve in the courts. They can have a very negative impact on businesses and employees. They are especially difficult for smaller companies engaging with much larger ones. Often, by the time a verdict is delivered, the importance of the disputed trade secret may have diminished. The major winners are usually the legal teams.

Uniform Trade Secrets Act--Definitions

The following is an extract (Section 1. Definitions) from the Uniform Trade Secrets Act to clarify the meaning of terms used in the act.

Uniform Trade Secrets Act with 1985 Amendments

SECTION 1. DEFINITIONS. As used in this [Act], unless the context requires otherwise:

 

(1) "Improper means" includes theft, bribery, misrepresentation, breach or inducement of a breach of a duty to maintain secrecy, or espionage through electronic or other means.

 

(2) "Misappropriation" means:

(i) acquisition of a trade secret of another by a person who knows or has reason to know that the trade secret was acquired by improper means; or

(ii) disclosure or use of a trade secret of another without express or implied consent by a person who

(A) used improper means to acquire knowledge of the trade secret; or

(B) at the time of disclosure or use, knew or had reason to know that his knowledge of the trade secret was

(I) derived from or through a person who had utilized improper means to acquire it;

(II) acquired under circumstances giving rise to a duty to maintain its secrecy or limit its use; or

(III) derived from or through a person who owed a duty to the person seeking relief to maintain its secrecy or limit its use; or

(C) before a material change of his [or her] position, knew or had reason to know that it was a trade secret and that knowledge of it had been acquired by accident or mistake.

 

(3) "Person" means a natural person, corporation, business trust, estate, trust, partnership, association, joint venture, government, governmental subdivision or agency, or any other legal or commercial entity.

 

(4) "Trade secret" means information, including a formula, pattern, compilation, program, device, method, technique, or process, that:

(i) derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and

(ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

GAUTAM KOPPALA,

POME AUTHOR

About the Author:
GAUTAM KOPPALA, With over   a decade, track record of successful leadership, excellent results through strategic skills in driving revenue and profit growth. Demonstrated ability to identify and trouble shoot critical issues impacting productivity, cost, distribution, marketing, Strategic positioning, sales and financial operations, with innate ability to build and maintain strong client relationships in operations. Expert in distilling and managing processes, enhancing internal structures, and promoting multi-skilled team competencies via nurturing mentorship and inspirational leadership. Engagements have spanned operational, strategic, technological and change management roles. Academically, I am a cum laude graduate with a Bachelor of Technology degree in Electrical and Electronics Engineering (B-Tech E.E.E.) and a post graduate in Masters in Human Resources Management (M.H.R.M.) and Masters of Foreign Trade (M.F.T.). As you will see my Post Graduation's were been studied part-time, as well as working full-time as an Engineer. I feel that this demonstrates my ability to maintain dedication, motivation and enthusiasm for a project management over a long period of time. In addition, balancing full-time work with study has perfected my time-management and organizational skills. I believe that my college degrees and gamut certifications in combination with my extensive broad-based work experience along with my drive, resourcefulness and determination, would make me an excellent candidate for a senior management position with any company. Highlights of my background include Operations related Commercial, Supply chain, Sales with a magnificent experience in Project management, technically oriented towards Automation and Security Systems in Industrial and Building sectors. Presently, writing a book on Projects and Operations Management (comprise of 12 volumes, 6K pages), and awaited for the reputed publications. These books can be checked in Google books and other search engines too.