Kane Russell Coleman Logan PC - Richard Hathaway, Lexology; Keeping Your Trade Secrets a Secret: Three Common Myths about Trade Secret Protection that could put your Business's Trade Secrets at Risk
"This blog post will address three common myths many business leaders have about protecting their trade secrets.
Myth Number One: All Confidential Information is a Trade Secret.
Not all of your business's confidential information qualifies for trade secret protection. It's essential to understand the distinction between confidential information and trade secrets. While all trade secrets contain confidential information, not all confidential information qualifies as a trade secret. If you graphed these concepts as a Venn diagram, your business's trade secrets would be the smaller circle inside the more prominent "confidential information" circle.
Under most Uniform Trade Secret Acts adopted by individual states and the federal Defense of Trade Secrets Act, to be considered a trade secret, the business information must:
- Have economic value derived from not being generally known or easily discoverable; and
- Be subject to reasonable efforts to maintain its secrecy.
Common examples of legally recognized trade secrets include proprietary formulas, manufacturing processes, pricing lists, and customer lists. However, general business information, employee data, or other information your business keeps from prying eyes may only meet the criteria for trade secret protection if it has a competitive economic use for your business. Knowing the difference between these essential concepts is critical to understanding where your business should focus its limited resources to protect its trade secrets."
