The (Still) Shaky Foundations of Trade Secret Law
55 Pages Posted: 3 Jun 2014 Last revised: 11 Oct 2015
Date Written: June 1, 2014
In an article published about fifteen years ago, A New Look at Trade Secret Law: Doctrine in Search of Justification, 86 CALIF. L. REV. 241 (1998), I argued that that there is no convincing normative basis for an independent body of trade secret law distinct from other legal theories, and I recommended limiting protection for trade secret information mostly to contract. Since then, a number of scholars have come to the defense of trade secrecy, and many have challenged my original arguments. In this symposium article, I revisit my earlier analysis in light of this subsequent literature and respond to the arguments of my critics. I remain skeptical that there is a normative basis for a freestanding trade secret law that is not parasitic on other legal norms. My claim is that the only way broad protection for trade secrets could be desirable is if its social benefits exceed its social costs and that we lack the empirical evidence necessary to make this determination with a sufficient level of confidence. This raises the question of what to do when a body of law is justified, if at all, only on consequentialist grounds and there is insufficient empirical evidence to make reliable predictions about consequences. I briefly address this question in general and in the specific context of trade secret law.
Keywords: trade secrecy, trade secret law, intellectual property, economics of trade secret law
JEL Classification: K00, K11, K19, K29, K39
Suggested Citation: Suggested Citation