Category Archives: Trade Secrets

Subscribe to Trade Secrets RSS Feed

Yes, the DTSA Ex Parte Seizure Provision Is Constitutional

A defendant opposing or challenging an injunction under the Defend Trade Secrets Act (DTSA) often has several potential defenses, including arguing that the information at issue is not truly a trade secret, that the injunction is unnecessary or overbroad, or that the defendant simply “didn’t do it.”  One argument that should not make the cut, … Continue Reading

Are Your Diversity Initiatives Trade Secrets?

Last month, a tech giant (IBM) sued one of its former executives who went to work for another tech giant (Microsoft), alleging that she breached her non-compete agreement and misappropriated trade secrets. Given the parties involved, you probably assume that the trade secrets at issue were source codes or algorithms. In fact, they were IBM’s … Continue Reading

The Danger of “Autofill” and Inadvertent Disclosure in Employee Mobility Matters

The Federal Rules of Civil Procedure were amended in December 2015 to help mitigate the risk of inadvertent disclosure of privileged information present in virtually every litigation. Such risk, however, is particularly acute in litigation involving trade secrets, non-competition, non-solicitation, and/or non-disclosure agreements. Employee mobility litigation poses a special risk for inadvertent disclosure because of … Continue Reading

New York Appellate Court Declines To Enforce Non-Compete Agreement Against Employees Terminated Without Cause

It should come as little surprise to employers that the New York courts take a skeptical view of non-compete agreements between employers and employees. Consistent with this view, a New York State appellate court recently confirmed what many, including prior authors of this blog, already understood: in New York, any employer who terminates an employee … Continue Reading

New York Employers’ Use of Non-Competes in Jeopardy?

New York Attorney General Eric Schneiderman has promised to introduce a bill that would restrict New York employers’ use of non-compete agreements for certain non-highly-compensated employees. The proposed legislation would (i) ban the use of non-competes for employees who earn less than $900 per week; (ii) require employers to pay additional monetary consideration in exchange … Continue Reading

U.S. Supreme Court Denies Certiorari on ITC Ban Based on Trade Secret Misappropriation

A Chinese tire manufacturer, Sino Legend, was found to have misappropriated trade secrets—in China—from another Chinese company. The International Trade Commission, in turn, banned Sino Legend’s tires from the United States for 10 years. On January 9, 2017 the U.S. Supreme Court denied Sino Legend’s Petition for a Writ of Certiorari on whether the U.S. … Continue Reading

California Further Restricts Employers from Trying to Enforce Non-Compete Agreements

Are you an employer based outside of California with employees who live or work in California? If so, you will want to take note of a new California Labor Code provision that becomes effective on January 1. Not surprisingly, companies headquartered outside of California generally have employment agreements that are purported to be governed by … Continue Reading

Litigating Whistle-Blower Immunity Under the Defend Trade Secrets Act

The Defend Trade Secrets Act grants immunity from any federal or state trade secret law to anyone who discloses a trade secret to an attorney or government official “solely for the purpose of reporting or investigating a suspected violation of law.” A recent district court decision holds that a defendant must present evidence justifying the … Continue Reading

White House Call to Action to Limit Non-Competes

Earlier this year, the White House and Treasury issued reports criticizing the widespread use of non-compete agreements. They found that such agreements affect nearly one in five U.S. workers, or approximately 30 million people. Last week the White House expanded its efforts, issuing a Call to Action for states to reform and limit non-compete agreements, … Continue Reading

Ninth Circuit Revives Implied Confidential Relationships in Trade Secrets Case

In a decision handed down September 6, 2016, the Ninth Circuit revived the notion, long presumed dead, that an implied confidential relationship can arise from the context of a business communication or relationship.  While the Ninth Circuit declined to rule on the basis of an implied confidential relationship, it did open the door to future … Continue Reading

Fox v. Netflix – Employee Mobility in a Transforming World

At first glance, you wouldn’t believe Netflix (formerly known as a distributor) would be a competitor of 20th Century Fox (known as a producer). If anything, they should be doing business with one another. But times change, and in this situation, the transforming entertainment industry pits Netflix (now alleged to be “an internet-based television and … Continue Reading

Ask, Tell, & Do: Three Keys to using Exit Interviews to Protect Against Trade Secret Misappropriation

Departing employees  pose one of the biggest risks of misappropriation of a company’s proprietary and confidential information and trade secrets. When a high-level employee has access to critical company information, conducting an appropriate exit interview requires more than an HR rep checking off boxes on a form. When it comes to protecting trade secrets from … Continue Reading

Three Reasons Why Employees Might Pose the Biggest Threat to a Company’s Trade Secrets

  For many people, “trade secret theft” evokes an image of a technological superspy, a James Bond meets Edward Snowden. But the more common, less dramatic and yet more dangerous threat to a company’s proprietary information comes from within.  Current and departing employees likely are more threatening to a company’s trade secrets than are foreign … Continue Reading

Does California Code of Civil Procedure 2019.210 Apply to the Defend Trade Secrets Act?

Trade secret litigators in California are familiar with California Code of Civil Procedure section 2019.210. That section requires plaintiffs to identify their alleged trade secrets with “reasonable particularity.” Critically, the section requires that plaintiffs do so “before commencing discovery relating to the trade secret.” Section 2019.210 has long been an important weapon in the arsenal … Continue Reading

Potential Impact of the DTSA: Amending your Confidentiality and Proprietary Information Agreements

On May 11, 2016, President Obama signed the Defend Trade Secrets Act of 2016 into law, effective immediately (DTSA; Amending 18 U.S.C. §§ 1832–1839). The DTSA creates a federal cause of action for trade secret misappropriation whereby aggrieved employers may now seek injunctive relief (including civil seizure orders), compensatory damages, exemplary damages, and attorneys’ fees … Continue Reading