Trade Secrets FAQ

What is intellectual property?
Intellectual property rights control products of creative thought and include patents, trademarks, copyrights and trade secrets. Intellectual property law relating to e-commerce and the Internet is developing rapidly.
Why is intellectual property important?
Protecting innovation and maintaining competitive advantages is a must in today's economy. Equally important, and easily overlooked, is the necessity of respecting intellectual property of others.
How can a business manage intellectual property?
Someone in the business should be trained to recognize intellectual property issues and authorized to take action when issues arise. Prompt action can be essential to a successful result. The business should establish a relationship with an intellectual property lawyer.
What is a trade secret?
A trade secret is confidential business information that provides a competitive advantage over those who do not know it and cannot readily obtain it.
Are trade secrets protected by state and federal law?
Trade secrets are protected under state law, although federal law might apply under specific circumstances. A large majority of states, including Pennsylvania, have enacted versions of the Uniform Trade Secrets Act ("UTSA") that allows suit for misappropriation of trade secrets. Some states also make it a crime to misappropriate trade secrets by force or by willful and malicious means.
How long can a trade secret last?
A trade secret lasts as long as the information is kept in confidence and is not known or readily obtainable by others. A trade secret can last forever.
What types of information qualify for trade secret protection?
Information that has actual or potential value from not being known to competitors and is not readily obtainable by proper means qualifies for trade secret protection.
The Uniform Trade Secrets Act states that such information includes formulas, patterns, compilations, programs, devices, methods, or techniques.
The Pennsylvania UTSA also expressly includes drawings and customer lists as qualifying information.
How can a business protect its trade secrets?
To protect trade secrets from being taken by others, a business must demonstrate that reasonable efforts were made to maintain the confidentiality of the information. What is reasonable depends on the value of the information, the ease with which it could be acquired by others, and the extent to which it is known outside the business.
"Reasonable efforts" have been held to include advising employees about trade secrets, limiting access to confidential information on a "need to know" basis, controlling facility access, and the use of confidentiality and non-disclosure agreements with licensees and vendors.
The business should identify its trade secrets and implement reasonable safeguards to prevent non-confidential disclosure of that information to others.