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http://ssrn.com/abstract=1571436
 
 

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The People’s Trade Secrets?


David S. Levine


Elon University School of Law; Stanford University - Center for Internet and Society

February 18, 2011

Michigan Telecommunications and Technology Law Review, Forthcoming

Abstract:     
The content of administered public school exams, modifications made by a government to its voting machines, and the business strategies of government corporations should be of interest to the public. At a minimum, they are the kinds of information that a government should allow its citizens to see and examine. After all, the public might have some legitimate questions for its government: Is that voting machine working so that my vote gets counted? Is that public school examination fair and accurate? To whom or what is that government agency marketing and are kickbacks involved? One would think that the government should have to publicly answer such questions, at least in a democracy.

While initially the above does not sound too controversial, the law has made it problematic. Getting access to the information that would answer the above questions may not be easy because the person requesting the information might have to show that the information is not a government trade secret before it can be disclosed. Today, the government of the people can keep information from the people by way of the commercial, intellectual property law of trade secrecy. Strangely, the people – citizens of states and the United States – apparently have trade secrets that they themselves cannot see. In other words, there is information that the government itself creates on its own (a “government trade secret”) and that courts or attorneys general have found meet the applicable definition of a trade secret. This article examines whether a government trade secret should be allowed to exist, and, if so, whether governments should be allowed to shield government trade secrets from public disclosure.

Importantly, I am not focusing here on trade secrets shared with government by private industry or created by private industry on the public’s dime. That topic was the focus of an earlier article. In Secrecy, I examined the question of whether private entities engaged in the provision of public infrastructure, like voting machines and public wifi Internet access, should be allowed to shield information regarding their products and services from public disclosure by way of trade secrecy. This is a question of applying democratic values like transparency and accountability to private entities, the practical effect of which is in direct conflict with the purpose of trade secrecy, namely, keeping information private. I concluded that, as applied to public infrastructure, trade secrecy should not be utilized by private entities engaged in its provision.

While the conflict here is similar – transparency versus secrecy – the policy considerations are quite different. For example: do we need to incentivize innovation in government by way of trade secrecy? Should the government be in the business of leveraging competitive advantage in order to generate revenue or, much worse, for an unstated ulterior motive like avoiding public scrutiny? If the government is allowed to consider cost-effectiveness in its operations, should trade secrecy be the mechanism that allows for this consideration? As the application of trade secrecy by government is a very recent development (at least in the United States) and there a very few reported decisions dealing with the issue, its ramifications have yet to be explored in detail.

I examine these questions and issues by explaining how trade secrecy and freedom of information laws interact, emphasizing the theoretically discordant nature of the government trade secret. In part two, I examine the basic issues involved in finding and maintaining a trade secret. In part three, I discuss several scenarios where government trade secrets have been asserted with questionable basis in the law, such as a county’s modification of voting machines, and/or where government trade secrecy has prevented the public from accessing valuable information, such as a public school system’s examinations and the minutes of public corporation board meetings. Additionally, I posit reasons why we may think that the problem of government trade secrets may be growing. In part four, I outline the basic principles of transparency, accountability and democratic governance. In part five, I discuss possible solutions to the problems discussed, and conclude that trade secrecy is a poor fit in government for two primary reasons: (a) the utilitarian basis for trade secrecy does not fit well when applied to government, and (b) transparency and accountability, two core democratic values, are severely undermined when trade secrecy is used to prevent disclosure of otherwise public information.

Number of Pages in PDF File: 56

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Date posted: March 21, 2010 ; Last revised: March 1, 2012

Suggested Citation

Levine, David S., The People’s Trade Secrets? (February 18, 2011). Michigan Telecommunications and Technology Law Review, Forthcoming . Available at SSRN: http://ssrn.com/abstract=1571436

Contact Information

David S. Levine (Contact Author)
Elon University School of Law ( email )
201 N. Greene Street
Greensboro, NC 27401
United States
HOME PAGE: http://hearsayculture.com
Stanford University - Center for Internet and Society
Palo Alto, CA 94305-8610
United States
7049718500 (Phone)
HOME PAGE: http://cyberlaw.stanford.edu/blogs/levine/
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