Trade secrets are a form of intellectual property that business owners should not underestimate. Lansing trade secret attorneys Revision Legal have experience protecting business information and former employees from trade secret issues.

Michigan Trade Secret Law

Unlike trademarks, copyrights, or patents, trade secrets are primarily protected by state law. Michigan has adopted the Michigan Uniform Trade Secrets Act. This legislation provides an avenue for Lansing business to prevent or stop the disclosure or use of protectable trade secret information.

What is a Trade Secret

Not all information in your business is a protectable trade secret. In fact, even information that is considered confidential may not rise to the level of a trade secret.

Michigan law, at MCL 445. 1902(d), defines a trade secret. In short, a trade secret is information, in the form of a pattern, compilation, method, or program, among other forms, that derives monetary value from its secrecy. Trade secret litigation typically involves a fact-intensive analysis to determine whether the information is protected.

For a more detailed analysis of whether customer lists, vendor lists, or information learned on the job constitute a trade secret, read our post on the details here.

Trade Secret Litigation

Our attorneys have experience handing misappropriation of trade secret claims. When the secrets that your business depends on are at risk, you should consult with an attorney as soon as possible.

Contact our trade secret attorneys today for an evaluation of your case by completing the contact form on this page or by calling the number above.

The Michigan Uniform Trade Secrets Act

Michigan enacted the Michigan Uniform Trade Secrets Act (MUTSA), MCL 445.1901 et seq., to provide businesses with a comprehensive statutory framework for protecting confidential business information. The MUTSA provides both civil remedies for misappropriation and, in coordination with Michigan’s criminal statutes, potential criminal liability for those who steal trade secrets.

The MUTSA defines a trade secret at MCL 445.1902(d) as information, including a formula, pattern, compilation, program, device, method, technique, or process, that derives independent economic value from not being generally known or readily ascertainable by others who could obtain economic value from it, and that is the subject of reasonable efforts to maintain its secrecy. Both elements must be satisfied. Information that has independent economic value but is not actively kept secret is not protected. Conversely, information that is diligently guarded but has no competitive value will likewise fail to qualify.

Types of Information That Can Be Trade Secrets

Michigan courts have addressed a wide variety of information in trade secret cases. The following categories have been recognized as potentially protectable when the other elements of the definition are met:

• Customer lists and customer data — Lists that compile non-public information about customers, including purchasing history, pricing terms, and contact details, can rise to the level of a trade secret when actively protected.
• Pricing and cost structures — Proprietary pricing models, margin analyses, and cost data that give a business a competitive advantage may qualify as trade secrets.
• Manufacturing processes and formulas — Specialized production techniques, chemical formulas, and engineering know-how are among the most classically recognized trade secrets under Michigan law.
• Software and proprietary algorithms — Source code, algorithms, and software architecture can be protectable when kept confidential through access controls and contractual obligations.
• Business strategy and development plans — Unreleased product plans, acquisition strategies, and expansion roadmaps may qualify as trade secrets if kept confidential and providing a competitive edge.

How Trade Secrets Are Misappropriated

The MUTSA defines misappropriation at MCL 445.1902(b) to include acquisition by improper means and unauthorized disclosure or use by someone who acquired the secret under circumstances creating a duty of secrecy. The most common scenario involves a departing employee who takes confidential information to a competitor or uses it to launch a competing business.

When an employee resigns, they may take customer lists downloaded before their departure, pricing data saved to personal devices, or product specifications retained after their employment ends. Courts have examined this scenario carefully. In Wysong Corp. v. M.I. Industries, 412 F. Supp. 2d 612 (E.D. Mich. 2005), the court scrutinized formula information shared with a former business partner, analyzing both the secrecy element and the adequacy of the steps taken to maintain it. The case illustrates the fact-intensive nature of trade secret disputes: even when the underlying information seems clearly valuable, proving both elements of the statutory definition requires specific evidence of how the information was developed and protected.

Remedies Under the MUTSA

The MUTSA provides a meaningful set of remedies for established misappropriation. Under MCL 445.1903, courts may grant injunctive relief to prevent actual or threatened misappropriation. A temporary restraining order or preliminary injunction can stop a former employee from using stolen information before serious competitive damage occurs — and in trade secret cases, speed is often critical. Once confidential information is disclosed to competitors or used to underprice your business, the harm can be difficult or impossible to quantify.

MCL 445.1904 authorizes recovery of damages, including actual loss caused by misappropriation and unjust enrichment not already reflected in the actual loss calculation. In cases of willful and malicious misappropriation, courts may award exemplary damages up to twice the actual damages. Reasonable attorney’s fees may also be awarded in willful misappropriation cases and in cases where a misappropriation claim is made in bad faith.

Proactive Steps for Lansing Businesses

The most effective trade secret protection starts before a dispute arises. Businesses that wait until after a key employee departs to assess their trade secret posture are already behind. Revision Legal advises Lansing businesses on a range of proactive measures:

• Identifying which business information qualifies as a trade secret and documenting that analysis in writing;
• Implementing security measures — password protection, access controls, need-to-know policies, and physical security — that demonstrate active efforts to maintain secrecy;
• Using well-drafted employment agreements with confidentiality provisions, non-disclosure obligations, and, where appropriate, non-compete and non-solicitation covenants;
• Conducting exit interviews with departing employees and reinforcing their post-employment obligations;
• Requiring the return of all company property, devices, and data at termination; and
• Monitoring competitive activity in the weeks and months following departures of key personnel.

Whether you are a Lansing business seeking to protect its competitive information or an individual or company facing a trade secret claim, Revision Legal’s trade secret attorneys are ready to evaluate your matter. Contact us today for a free consultation at (517) 505-2323 or complete the contact form on this page.