Theft of Trade Secrets
A trade secret is something owned by a company that is not readily known outside of it, and which provides the business with a competitive edge. While businesses usually protect such secrets by having an employee sign a non-disclosure agreement, nonetheless sometimes theft occurs. In such case a Conroe business lawyer may be able to help the plaintiff recover damages.
Definition and Examples of Trade Secrets
Trade secrets take many forms, ranging from software, formulas, unpatented research and inventions, marketing information, and processes. In order for something to be regarded as a legitimate trade secret it must fit certain criteria, including:
- It is only known within the business;
- And only by certain employees whose work requires them to be privy;
- And for which the company takes reasonable steps to protect the secrecy;
- Is valuable to the company;
- And is not readily able to be duplicated or acquired.
Texas and Federal Laws Regarding Theft of Trade Secrets
Texas adopted the Uniform Trade Secrets Act in 2013. The Act regards this type of theft as “misappropriation,” meaning that the secret was obtained by some sort of improper means. It is worth noting that not only can the person or entity which commits the theft be sued, but also a person who uses the secret, even if he doesn't know it was improperly acquired. A Conroe business lawyer will tell you that this is referred to as “constructive knowledge,” which differs from actual knowledge. In other words, the individual should have known that the secret was obtained improperly.
What Needs to Be Proven
In order for a company to be able to sue for theft of a trade secret it must show:
- Ownership of the secret.
- The secret was disclosed by the defendant.
- The plaintiff suffered damages as a result of the disclosure.
It is important to keep in mind that the statute of limitations for pursuing compensation is three years. Also, in addition to violating state laws, theft of trade secrets can be prosecuted under the federal Economic Espionage Act of 1996, with penalties that can include substantial fines and/or incarceration in federal prison.
If Your Business Has Suffered Theft of a Trade Secret
If you have questions about protecting your business from theft, or are a victim, call a Conroe business lawyer who has the experience and knowledge to provide you with the highest standard of legal guidance. Call Peterson Law Group today at 936-337-4681.