Misappropriation of Trade Secrets in Michigan

By Eric Misterovich

trade secret lawThe Michigan Uniform Trade Secrets Act (MUTSA) provides the statutory authority for businesses to prevent, or put a stop to, the unlawful use of their trade secrets. While other causes of action may be included, this situation calls for an action for “misappropriation of trade secrets.”

 

The Three Elements of Misappropriation of Trade Secrets in Michigan

The test to establish the misappropriation of trade secrets contains three elements:

  1. the existence of a trade secret;
  2. the defendant’s acquisition of the trade secret in confidence, and,
  3. the defendant’s unauthorized use of it.

 

The Existence of a Trade Secret

The MUSTA defines a trade secret as: information, including a formula, pattern, compilation, program, device, method, technique, or process, that is both of the following:

 

(i) Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use.

 

(ii) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

 

In other words, the information must be a secret, meaning evidence has be presented that sufficient means were taken to guard its secrecy. This element, whether the information is a protectable trade secret,  is typically subject to considerable litigation and often presents a turning point in trade secret litigation.

 

The Defendant’s Acquisition of the Trade Secret in Confidence

Consistent with the definition of trade secret, there must be an indication between the parties that the information being shared is being shared in confidence. Often this is accomplished through the execution of a non-disclosure or confidentiality agreement. In rare circumstances, courts can imply a duty to hold information in confidence.

 

The Defendants’ Unauthorized Use of the Trade Secret

The final prong requires the plaintiff to present enough evidence to substantiate not only that the defendant used the information, but that the defendant was not authorized to use that information.

 

This prong can involve a heavily fact intensive analysis regarding the information at issue, the proper use of the information, and the limits, either express or implied, on the permissible use of the information.

 

Contact a Michigan Trade Secrets Attorney

Trade secret plaintiffs must overcome a number of hurdles to prove their claims. Revision Legal attorneys have experience both prosecuting and defending trade secret cases.

 

If you require a Michigan trade secrets attorney, contact Revision Legal today, by completing the contact form on this page or by calling us at the number above.

 

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