Trade secrets may be recipes, client lists, software code, a prototype for a new invention, investment strategies, pricing information, or drawings/architectural plans.
The best way to protect trade secrets is to make sure you have:
- Employee agreements that include non-disclosure and non-compete clauses
- Language in your business policies pertaining to the protection of all trade secrets
- Passwords to protect trade secrets that are in an electronic format
- Locked up recipes, formulas and prototypes
Before you meet with potential investors, make sure they sign non-disclosure agreements and non-compete agreements.
Trade secrets give a business a competitive edge. The greatest threat to company trade secrets is internal employee theft.
Business owners need to make sure they have proper procedures in place to protect company secrets and protect their competitive edge in the marketplace.
The Marks Gray intellectual property team’s trade secret attorneys help clients put proper protocol and procedures in place to protect vital information such as client lists, algorithms, and recipes.
Frequently Asked Questions:
What is a trade secret?
The term “trade secret” means all forms and types of financial, business, scientific, technical, economic, or engineering information, including patterns, plans, compilations, program devices, formulas, designs, prototypes, methods, techniques, processes, procedures, programs, or codes, whether tangible or intangible, and whether or how stored, compiled, or memorialized physically, electronically, graphically, photographically, or in writing if –
(A) the owner thereof has taken reasonable measures to keep such information secret; and
(B) the information derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable through proper means by another person who can obtain economic value from the disclosure or use of the information; 18 U.S.C. § 1839(3)
How can I protect my trade secrets?
How you protect a trade secret depends on the type of secret. You may lock some secrets in a safe. You should ensure a limited number of people have access to the safe, and that those people have reviewed and signed confidentiality agreements. Other trade secrets can only be protected by establishing policies regarding trade secret information with appropriate non-disclosure and confidentiality agreements in place. If the secrets are stored on a computer system, then you need to make sure you use passwords and/or encrypted files along with having appropriate policies and agreements in place.