TRADE SECRET LITIGATION
CD: What do you consider to be among the key trends shaping trade secret litigation in recent months? Have there been any significant legal and regulatory developments in this space?
Steadman: One of the key trade secret litigation trends is the increasing use, and leverage, of trade secret cases at the International Trade Commission (ITC). The ITC has long had the authority and jurisdiction under Section 337 to litigate trade secret cases involving imports to the US, but parties are now using that jurisdiction regularly. And it is quite powerful. If it finds imported goods made using a misappropriated trade secret, the ITC can exercise jurisdiction to issue an exclusion order, keeping imports from entering the US market. This is so even if the trade secret was allegedly misappropriated overseas, and even if the trade secret is used entirely overseas. The ITC can also exercise jurisdiction even if the domestic industry the ITC is protecting does not use the trade secret at all.
CD: In today’s digital age, how easy is it for employees, former employees, cyber criminals or other bad actors to misappropriate trade secrets? How would you characterise this risk for companies?
Hiller: The civil and criminal exfiltration of trade secret information has proliferated with the rise in electronic communication, storage and recording applications, and remote work capabilities. Security measures and compliance programmes mitigate risk, but victims often overestimate their security and underestimate their risk from insiders, cyber criminals and even nation states. Each company has a unique risk profile. To better understand that profile, identify vulnerabilities, and have an executable plan in the event of a theft, companies should conduct privileged risk assessments coupled with scenario-based testing.
Oct-Dec 2021 issue
DLA Piper