Is Trade Secret Protection Right for Your Business?
Modern businesses have begun to realize that some of their most important assets are completely intangible, things like business reputation or innovative ways of doing things. This has led more and more companies to begin seeking intellectual property protection for their ideas in order to gain an edge over their competitors. When people begin thinking about protecting their ideas, they think about patents, copyrights, and trademarks. However, there is another option that could make more sense, depending on the type of potential property in question. Businesses can also protect their ideas by making them trade secrets. Trade secrets are a less well known form of intellectual property protection that can still be quite powerful, particularly since it is the only type of intellectual property designed to protect innovations that can last forever.
Qualifying for Trade Secret Status
Trade secret status is a much more flexible type of intellectual property protection than the other three, and it can protect many different types of business information. Florida law allows many different types of information to qualify for trade secret protection, including computer programs, formulas, client lists, and proprietary methods or techniques. However, these pieces of business information are not inherently protected as trade secrets.
First, the law limits trade secret protection to information that has some economic value, and that other people cannot figure out just from the use of the information. For instance, take the recipe for Coca-Cola, one of the most famous trade secrets in the world. The company derives economic value from the edge that the formula’s taste provides over competitors, and no one can tell what goes into the formula just from buying or drinking a Coke.
Second, the business must also make reasonable efforts to maintain the secrecy of the information for trade secret protection to apply. Of course, that raises the question of what efforts are reasonable. The precise answer will depend upon the specific information in question, but reasonable efforts can include things like disclosing the information only on a need to know basis, protecting it with confidentiality agreements when disclosed, and keeping physical copies of the information under lock and key.
What Trade Secret Status Protects Against
Some of the most important things to understand about trade secrets are the limitations on what they protect against. Rather than preventing anyone from using the secret, the law prevents people from “misappropriating” the trade secret. This means that they cannot acquire, reveal, or use a trade secret that they have learned about through improper means.
The law also specifically defines improper means. It states that a person may not acquire trade secrets through things like theft, bribery, breaching confidentiality, or espionage. What this means in a practical sense is that if a person steals a trade secret from a business, then they cannot use it. However, if they happen to discover the same formula or think up the same business method, then the trade secret does not apply.
Companies that have valuable trade secrets can often benefit from proactive steps to ensure that the secret is protected by law. If you want to learn more about protecting your ideas this way, or you believe that someone has misappropriated some of your company’s confidential information, contact a West Palm Beach business litigation attorney at Pike & Lustig, LLP today.