The Contours of American Trade Secret Law: What Is and What Isn't Protectable as a Trade Secret
19 SMU Science and Technology Law Review 89 (2016)
36 Pages Posted: 25 Nov 2016
Date Written: November 22, 2016
This article is the first thorough comparison of the definition of trade secret in the Uniform Trade Secrets Act, which has been enacted in 47 states, with the principal nonuniform amendments adopted by various states, and with the subsequent definitions of trade secrets in the federal Economic Espionage Act, the Restatements of Unfair Competition and Employment Law, the NAFTA Agreement, the TRIPs Agreement, and the proposed European Union Directive on Undisclosed Know-How and Business Information (Trade Secrets). With the exception of the Nebraska nonuniform amendments, which unduly limit protectable trade secrets by unreasonably expanding the scope of the “known” and “ascertainable” exclusions from the definition, as interpreted by the courts, the nonuniform amendments have not been unduly impairing. Perhaps because they were negotiated, the treaties and the proposed European Union Directive were influenced by the Uniform Act definition but offer no suggestions for improving it. The Restatement of Unfair Competition definition suggests that reference to “independent” economic value could be deleted but this phraseology has not caused apparent problems. Most importantly, the Restatement of Employment Law suggests that in applying the Uniform Act definition, the courts should require a plaintiff former employer to prove that the relief requested does not unnecessarily restrict the defendant former employee’s exercise of his or her general experience and ordinary knowledge, training, and skills. Moreover, this burden should include proof that any threatened misappropriation involves positive secret information about what will work rather than purely negative secret information about what will not work.
Keywords: Uniform Trade Secrets Act; Restatement of Torts (First), Restatement of Unfair Competition, Restatement of Employment Law, the NAFTA Agreement, the TRIPs Agreement, the Proposed European Union Directive on Undisclosed Know-How and Business Information (Trade Secrets), Trade Secrets
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