Further, the court in Brocade Communication Systems Inc. According Morlife, information that is difficult and time-consuming to obtain will likely be more protectable than information than was neither difficult nor time-consuming to obtain. In Morlife, the court ruled that information about customers that was "stored on computer with restricted access" which had been subject to "a confidentiality provision expressly referring to customer names and telephone numbers" fell under trade secret protection. whether the information was subject to confidentiality provisions.The court also found three factors to be helpful when determining whether something is a trade secret: 4th 1514 (1997), the California court held that customer identities from an organization's list are protected as trade secrets if the identities are not generally known to the industry. Sazonoz was employed for thirteen years by Susquehanna International Group ("Susquehanna"), a financial services firm headquartered in Pennsylvania with offices in Manhattan." Scope of Subject Matter Customer ListsĬustomer lists and other lists related to customer business qualify for trade secret protection if the lists' information cannot be ascertained from other generally available sources.
Economic espionage code#
Sazonov, a case currently pending in the United States District Court for the Southern District of New York, the defendant Sazonoz has been charged with violating the EEA for "attempt to steal valuable proprietary computer code that took his employer years to develop. In 1996, Congress enacted the Economic Espionage Act ("EEA"), codified as 18 U.S.C. In some circumstances, misappropriation of trade secrets is not only a tort it is a federal crime. Misappropriation of Trade Secrets as a Crime The misappropriation of trade secrets is considered a form of unfair competition, and is discussed in the Restatement (Third) of Unfair Competition. Trade secrets may be obtained by lawful means such as independent discovery, reverse engineering, and inadvertent disclosure resulting from the trade secret holder's failure to take reasonable protective measures. There are two basic situations in which obtaining the use of a trade secret is illegal where it is acquired through improper means, or where it involves a breach of confidence. Use of a trade secret belonging to another does not always constitute misappropriation. The trade secret holder must prove that the information was misappropriated or wrongfully taken.The holder of the subject matter must establish that reasonable precautions were taken to prevent disclosure of the subject matter.The subject matter involved must qualify for trade secret protection (see "Scope" below for more on this).There are typically three essential elements to a trade secret claim: The ease or difficulty with which the information could be properly acquired or duplicated by others.The amount of effort or money expended by the business in developing the information.The value of the information to the business and its competitors.The extent of measures taken by the claimant to guard the secrecy of the information.The extent to which it is known by employees and others involved in the business.
Sections 757 and 758 of the Restatement of Torts (1939) set forth the basic principles of trade secret law that were widely adopted by U.S. Prior the the development of the UTSA, improper use or disclosure of a trade secret was traditionally a common law tort.
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