Trades secrets are important to a company’s bottom line and they are at the core of any company’s long-term success. Consider, for example, the famous Kentucky Fried Chicken recipe, which allegedly includes 11 herbs and spices. Kentucky Fried Chicken has kept its renowned recipe a secret for decades, which many consider to be the key to the restaurant’s success. Would customers continue to frequent the ubiquitous restaurant chain if they could get an identical product from its competitors? Maybe not.
For a company’s trade secret to remain a trade secret, it must be kept a secret by every single employee and company insider in the know. Once a trade secret is out in the open, it is no longer a trade secret, and the company’s success may be put in jeopardy.
A trade secret is any business information, such as a product formula, pattern, compilation, program, device, method, technique, or process that gives a company an economic advantage over its competitors who do not know or use the information. When a trade secret is misappropriated by another person or entity, a company can file a lawsuit against the entity that has taken it.
In the digital world we live in today, how do companies big and small keep their trade secrets a secret from their competitors? With internet transmissions, tweets, social media posts, and constant mobile communication, trade secrets can easily become public with the swipe of a finger or the click of a button. If a company is targeted by hackers, those entities can cause trade secrets to be copied and distributed to countless people without a company’s permission in the blink of an eye.
With this in mind, do not put your company’s trade secrets on the internet or allow them to be displayed on any smartphone or social media account. If you do, they are vulnerable to being revealed to other people and released to the public at large. Make sure you have security measures in place to protect against hostile forces, such as hackers, who seek to expose your company’s sensitive and confidential trade secrets.
While you may love your employees, you should not allow unauthorized staff members access to your trade secrets. Theft of a company’s data and trade secrets is an ever-increasing problem in the digital corporate world. Studies reveal that litigation over the theft of trade secrets has increased significantly over the past few years. To curb the problem of trade secret exposure, the Defend Trade Secrets Act of 2016 was recently signed into law by our legislators. This new law allows a company to bring a federal civil cause of action for the theft of trade secrets and other intellectual property. Now, companies can sue in federal court when their privacy has been breached and their trade secrets exposed.
Companies should take the necessary steps to keep their trade secrets confidential and be proactive in safeguarding their valuable confidential information. The American Bar Association has published a story that outlines eight steps you should take to secure your company’s trade secrets. They include the following:
- Policies, procedures, and records: Your company policies must be clearly communicated to your employees as they pertain to the handling of trade secrets and other confidential information, and you need procedures in place to implement these policies.
- Information protection team: Identify people across the organization who are responsible for ensuring that policies are in place and procedures are implemented to protect your trade secrets and confidential information.
- Risk assessment: Do an assessment to understand what your key trade secrets are, where that sensitive information is stored, who has access to it, who may be interested in taking it, and the ways in which your employees should use that information appropriately.
- Management of third parties: Know who your third party vendors and partners are and how they manage their employees, especially if they have access to your confidential information.
- Security and confidentiality management: Have security procedures and protocols in place in both in the physical world and the digital world.
- Training and capacity-building: Be clear with all of your employees as well as your third party partners about their roles in protecting your company’s trade secrets.
- Monitoring and measurement: Many companies fail to properly monitor to see if their policies and procedures regarding confidential information and trade secrets are being followed on a regular basis.
- Corrective actions and improvements: What do you do once you learn that there has been a theft of your company’s trade secrets? How do you go back and identify how it happened and tweak your policies and enforcement so that it will not happen again?
To protect your company’s trade secrets, you should always assume that others will try to discover and appropriate them. Therefore, you should establish and implement protocols to maintain their secrecy. In today’s corporate environment, all companies need to safeguard their trade secrets not only in the physical office space, but also in cyberspace. Hackers, competitors, and disgruntled employees may be trying to discover those trade secrets and reveal them to the public at this very moment.
If you are concerned that your company may not be prepared to safeguard its trade secrets, consider reaching out to a business attorney for assistance. A well-versed intellectual property attorney can help your company develop a solid intellectual property strategy to protect your trade secrets from your competitors and help ensure a long and profitable life for your business. Contact the professionals at Revision Legal to help you with these complex issues of intellectual property protection for your business. We can be reached by using the form on this page or by calling us at 855-473-8474.
