![]() ![]() It is important to note that the DTSA provides some whistleblower protections. The statute of limitations for DTSA claims is three years from the date the misappropriation of the trade secret. Having a case heard in a federal court can allow for a quicker conclusion to disputes, although it may be a more costly process. Federal trade secret protections allow money for attorneys and double damages if the violation was willful. The main differences between the federal and state act are that federal cases will be heard in federal courts and damages may be higher. This gives parties a choice between localized disputes under state laws or disputes under federal law. In 2016, the trade secret protections in the United States were strengthened thanks to the Defend Trade Secret Act of 2016 (DTSA). The United States is obligated to provide trade secret protection as it is a member of the World Trade Organization (WTO) and a party to the Agreement on Trade-Related Aspects of Intellectual-Property Rights (TRIPS). However, small businesses can use employee agreements and non-disclosure agreements to protect their intellectual property. This approach can be difficult for small businesses, as they may not have enough employees to segregate a trade secret. This reduces the risk of an employee accidentally or purposefully sharing your entire trade secret with other parties. This business strategy ensures that no single employee knows the entire trade secret or knows how to use it. If you have a secret process for making a product that requires 5 separate steps, you would share one of the steps with five different employees. One of the most effective business strategies for protecting trade secrets is to partially distribute knowledge of the secret to different people. Using business strategies to protect trade secrets Using multiple NDAs to secure individual trade secrets gives your business a strong paper trail should a trade secret be leaked. The NDA must sufficiently describe the material being protected and should be signed by any individual who has access to that information. Non-disclosure agreements (NDA) are another option for securing confidential information like trade secrets. The employees must understand what the trade secrets are so they know which information should not be shared. In California, for example, employee agreements must define, with reasonable precision, the nature of any trade secrets and the importance of these trade secrets to the business. ![]() Some states will require the business to define the applicable trade secrets in detail within employee agreements. These agreements should contain provisions which clearly designate any trade secret protections relating to your business. ![]() Employee agreementsĮmployee agreements are the most effective way to prevent trade secrets from being leaked by employees. As a result, it would be difficult for the business to sue them afterward. If this isn’t made clear to an employee, he or she may have a case should something like this go to court. It is crucial that your employees understand that any trade secrets they have learned while working at your business are confidential. Ways to protect trade secrets Be clear that it is a secret ![]() This article will explain how to protect this important type of intellectual property. The qualifying factor for information to be considered a trade secret is that it must be used in business and must give the business an economic advantage over other competitors. Many types of information can be a trade secret including formulas, processes, designs, instrument, compilations of information, pattern, commercial method, and manufacturing techniques. Protections for trade secrets are used by businesses to safeguard secret information that is critical for maintaining their market advantage. ![]()
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