TRADE SECRETS

Trade secrets are information used in a business which gives a company an advantage over its competitors who do not have that information. Trade secrets can consist of formulas, customer lists, methods of operation and may also consist of a combination of elements which are individually in the public domain yet together provide some advantage not otherwise known.

In order to be protectable, trade secrets must not be generally known, and the owner must take reasonable steps at preserving the secrecy of the information. The degree of protectability will vary depending upon the efforts that were expended developing the secrets, how valuable the secrets are, how difficult it would be for another party to develop the secrets, and how carefully the owner preserves the secrecy of the information.

Trade secrets can be protected by contract. In addition to a general duty of loyalty owed by employees to their employers, contractual obligations to preserve trade secrets are generally enforceable. Such contracts should be entered into prior to employment, but may, with suitable consideration, be enforceable if entered into later. The scope of contractual trade secret protection may not be so broad as to prevent an employee from using his or her ordinary skills and experience in another job.

Employers should follow reasonable measures to preserve the secrecy of their trade secrets, including but not limited to limiting access to the secrets and proper identification of secret materials.

California Uniform Trade Secret Law

Actual or threatened misappropriation of trade secrets may be enjoined in California under California Civil Code 3426, otherwise known as the Uniform Trade Secrets Act. Trade secrets may include a broad variety of kinds of information, so long as such information may or does derive independent economic value from not being generally known. Acquisition of such information (owned by another) by one who knows or has reason to know that the trade secret was acquired by improper means, including any breach of duty to maintain secrecy, violates California's trade secret law, as is disclosure or use of trade secrets by one who used improper means to acquire knowledge of the trade secret, or by one who had reason to know that knowledge of the trade secret was acquired by improper means.

Federal Insecticides and Environmental Pesticides Control

Information which an official believes contains or relates to trade secrets may not be disclosed under Federal law, Title 7, Chapter 6.