Trade Secrets   What is a Trade Secret? Trade secrets can be any information or know-how that is not publicly available and that provides you with a commercial advantage. This could include such things as customer and client lists, production methods, product formulas, marketing strategies, pricing strategies and policies, and any other competitively sensitive information.   What Does Trade Secret Law Protect? Trade secret law is aimed at protecting any data or information that is kept secret and is valuable. Trade secret law prevents those who learn these secrets from using or disclosing your secrets. The key to establishing a trade secret right is taking reasonable steps to keep your valuable business information secret.   Keeping Valuable Business Information "Secret" There are a number of simple steps that should be considered in order to successfully maintain trade secret protection for your company information. We discuss with our clients the need and extent to which these and other steps should be taken to preserve their valuable business information: Initial interviews for all new employees to discuss the existence of the company trade secrets, to explain the importance of maintaining the confidences of the company, and to sign confidentiality agreements before any trade secrets are disclosed to the employee. Well-drafted and up-to-date confidentiality agreements to cover all trade secret information and non-solicitation provisions as necessary. In some cases, agreements should be modified and re-executed upon promotion to managerial positions. Non-competition agreements for management level employees and to preserve trade secrets. These agreements are generally scrutinized by courts called upon to enforce them. The laws of most states usually require that such agreements contain reasonable durational and geographic limitations, among other things. Password protection for information stored on computers and networks. Specific policies and practices on marking trade secret documents confidential, and limiting distribution of such information on a specified need-to-know basis. Maintaining distribution lists or access logs that track to whom the trade secret information has been disclosed. Maintaining appropriate on-site security and/or I.D. badges to prevent un-escorted visitors at your company. Exit interviews with departing employees to remind them of confidential obligations and obtain information on potential competitive activities.   Non-Disclosure (Confidentiality) Agreements Confidentiality agreements are often the first step in protecting trade secrets. A good confidentiality agreement should be a communication tool that emphasizes to every person having access to the trade secret information that such information is valuable and should be kept secret. This may include employees, independent contractors, vendors, clients, and any other person or entity to whom the trade secret information is disclosed in the course of business. One of the most important parts of a confidentiality agreement is the description of what it is that is confidential. Specific descriptions of what must be kept secret, rather than boilerplate legalese, will prevent misunderstandings later.   Non-Competition Agreements Non-competition agreements attempt to restrict employees, independent contractors, or others from working or competing against the business or in the same industry for some period of time. Most states disfavor non-competition agreements and limit their enforceability to specific types of employees and circumstances. To be enforceable, in most states a non-competition agreement must be reasonable in duration and geographic scope. Since the law governing non-competition agreements varies from state to state, we counsel our clients with the particulars of each state's law. Those hiring employees from competitors should determine whether the new hire has signed a non-competition agreement. Hiring a party to a non-competition agreement may create liability under a claim of tortious interference with a contract. Care must be taken accordingly. By helping our clients consider these issues in a timely fashion, we can dramatically reduce the risks of litigation, as well as increase the chances of success should litigation become necessary.   Enforcing Your Rights Time is often of the essence when a trade secret is about to be wrongfully used or disclosed. We are always prepared to use Vascoe Valdes LLP extensive litigation resources and extensive experience in the trade secret field to help our clients identify potential unauthorized disclosure of client trade secrets and obtain immediate court orders to preserve those confidences.