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What will reasonably qualify proprietary data as a trade secret?

In reference to today’s above-posed blog headline query, it can be emphatically stated first of all what will not ensure that a company’s prized internal data or information garners trade secret protection.

And that is merely claiming that it does.

Absent additional evidence to persuade a court that commercial principals erected safeguards around prized information deemed vital to business operation, a trade secret claim is not much more than a potentially refutable allegation.

That is certainly the way that a court recently weighing in on a trade secrets dispute sees things. An in-depth article on trade secret claims and required steps for protection notes the “painful lesson” imparted by a federal judge to a business claiming third-party infringement of proprietary information. The company alleged that key former employees took critically important data concerning customers, suppliers and pricing with them when they commenced work with a competitor.

The court duly acknowledged the company’s concerns. It also stated, though, that merely asserting the importance of the information in question did not qualify it for legal protection. In assessing that, the court looked for evidence showing that the company had “made reasonable efforts to maintain the secrecy of the information.”

The ruling on that was sharp and unequivocal: it wasn’t even a close call. The court found that the company’s processes and protocols in place to duly secure key data were “so lacking that it is difficult to identify their most significant shortcoming.”

The court’s delivered message in the case for companies demanding trade secret protection is manifestly clear, to wit: If you seek a favorable judicial ruling, demonstrate that you deemed data sufficiently important to address it with adequate security safeguards.

There are many ways to do that. Experienced attorneys from a proven business law firm can provide further information.

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