Research Assessment #8

Date: ​November 18, 2019

Topic: ​Intellectual Property Law

MLA Citation: ​“Digital Media Law Project.” ​Trade Secrets | Digital Media Law Project​,

www.dmlp.org/legal-guide/trade-secrets.

Analysis:

During my last interview, with Mr.Ross Angus Williams, he said a phrase that really

started turning the gears in my head: “trade secrets.” As soon as I heard these words I became

extremely curious upon the subject matter and ended up having an entire discussion on what they

were, how they affect IP lawyers and their jobs, and other intriguing pieces of information

pertaining to trade secrets. However, my thirst for knowledge was not fully satisfied, so after

conducting research upon the topic of trade secrets, I finally found an article that I believe covers

most of what I was hoping to learn, including:

● What trade secrets are

● What the goal of trade secrets are

● How trade secrets relate back to law

I will be breaking down this information and explaining why it is important to me below.

Trade secrets, in their simplest definition, are a piece of information or an actual physical

device that can make or break a company. Luckily, Mr.Williams specialized in trade secrets and

he referred to them as the “secret formula.” Trade secrets attempt to give businesses an

advantage over other companies by allowing them to keep the most crucial parts of their product,

idea, etc secret. If this “secret” does somehow get out the person or group responsible for
releasing the information may face various legal punishments in order to “undo” their actions

and repay the corporation. This information is crucial for me to understand as my mentor may be

working with trade secrets, and understanding what they are, as well as what they do, will enable

me to become more involved with actual legal tasks.

After understanding the meaning and function of trade secrets, I wished to relate them

back to my area of study: law (more specifically, intellectual property law). Thus, I delved

further into the topic of trade secrets and discovered, as stated above, that the exposition of trade

secrets leads to many legal issues. Both, the exposer and the victim, must acquire lawyers to

represent them in cases, which may potentially go to trial, in order to ensure that both sides get a

fair trade off for the crimes off the exposer. To elaborate, the company that had its secrets

exposed must be “repaid” in a proper manner, while the defendant must make sure that they do

not overpay for their mistake. The First Amendment is the most helpful and most utilized

component to protect the defendant, while the plaintiff attempts to “victimize” their clients (the

company that had its secrets exposed) to win the case and get a better deal out of the trade off.

Furthermore, trade secrets are tied back to the legal profession because an attorney is needed to

draft up the necessary documents that protect the secrets. Since the process of acquiring the

documents can be tedious and complex, it is always a better idea to have a professional complete

the process. While in the process of my mentorship, I hope to see some of these procedures

myself (unlikely because it’s a secret) to gain some experience in an area of interest and future

occupation.

Gaining insight about trade secrets proved beneficial and interesting and I have gained

even more knowledge in something I wish to pursue. As I continue to complete these research
assessments I will focus on specific aspects of IP law, as it seems that is what I am transitioning

into (entertainment is a subset of intellectual property). Having already covered hard IP aspects

(patents and trade secrets) I will attempt to make the next few assessments about soft IP topics

(trademark, copyright, etc.).

Article:

Trade Secrets
A trade secret is a ​form of ​intellectual property​ that applies to business secrets​. If a
company or other organization creates or compiles information that gives it an
economic advantage over its competitors​, it can protect that information as a trade
secret -- in a sense becoming the "owner" of the trade secret. To do so, however, a
business must take reasonable precautions to keep the information secret, and it loses
its property right when competitors or the public at large uncover the secret​. Trade
secrets law is governed by state law. However, most U.S. states have adopted their own
slightly modified version of the ​Uniform Trade Secret Act (UTSA)​, so there is a good
deal of ​uniformity among state laws on the subject​. For state-specific information,
please see the ​State Law: Trade Secrets​ section of this guide.

This part of the article just gives an introduction to trade secrets and describes them
as a “economic advantage.” It is useful to know that the state laws are generally
uniform, as I may move around when I become a legal professional.

The ​main goal of trade secrets law is to provide a way for businesses to capitalize on
their unique practices or knowledge created through their time and effort​. Unlike
copyright​, ​trade secrets law protects ideas and facts, rather than just the form in which
they are expressed​. A trade secret can be ​any kind of information relating to a business
-- formulas, plans, designs, patterns, supplier lists, customer lists, financial data,
personnel information, physical devices, processes, computer software, and a catch-all
category​ ​of "know-how." The most "well known" trade secret is the ​"secret formula"
for Coca-Cola​, which has been kept under wraps for more than 100 years.

This paragraph goes into more detail on the goal of trade secrets (“...provide a way for
businesses to capitalize on their unique practices or knowledge created through their
time and effort…”) and explains what forms they can come in (pretty much anything).
The secret formula for Coca-Cola is also mentioned, and I found this interesting as that
is the example that Mr.Williams utilized (only 2 people in the world know it).

By definition, trade secrets are not disclosed to the public. In this way, they are
different from inventions and creative works that are copyrighted or patented. And, in
contrast to copyrighted or patented information, ​trade secrets are not time-limited --
they last as long as the company manages to keep them secret​. The company that
creates them has the sole ability to exploit the secret as long as it manages to keep it
from becoming public knowledge. The catch is that ​trade secrets can disappear
without warning or any specific period of time passing​. Once disclosed, they're gone.
In addition, ​trade secrets law provides no protection against someone independently
developing the owner's trade secret information or reverse engineering it from a
finished product​.

Trade secrets can go on forever and can disappear very easily (if the secret gets out).
Also, if someone can distinguish the secret by themselves without utilizing illegal
means then the individual is protected from any legal issue.

For the most part, trade secrets law is directed against industrial espionage and
ex-employees sharing their former employers' proprietary information with new
employers. You might justifiably ask, then, what all this has to do with citizen media
and online publishing? Trade secrets law ​prohibits publishing someone else's trade
secrets under certain circumstances​, and businesses and other organizations
sometimes look to trade secrets law as ​a way of stopping the traditional and
non-traditional media from publishing valuable, sensitive, or damaging information​.
Many readers may recall Apple's dispute with ​Think Secret​, ​AppleInsider​, and
O'Grady's PowerPage​ over leaks of confidential information about unreleased Apple
products before MacWorld 2005. Apple turned to trade secrets law to make out its
case. Ultimately, the courts never decided the merits of Apple's trade secrets claims
because Think Secret settled and ceased operations, and Apple voluntarily withdrew
its lawsuit against the other sites after a California court upheld the website operators'
right to protect the identity of their sources under the California shield law. For
additional details on the lawsuits, see our database entries, ​Apple v. DePlume​ and
Apple v. Does​. Going back to 1999, Ford sued a website operator named Robert Lane
for posting its confidential documents and photographs on his site. Current and
former Ford employees had provided Lane with secret materials in violation of their
confidentiality agreements with the auto giant. The court found that Lane had likely
violated the Michigan Trade Secrets Act, but held that the First Amendment to the U.S.
Constitution did not permit the court to order Lane to remove the photographs and
documents from the Internet. See ​Ford Motor Company v. Lane​, 67 F. Supp. 2d 745
(E.D. Mich. 1999), for details.

Trade secrets protect from any illegal forms of exposition and provide protection from
the media.

If, like many people, your online activities are limited to synthesizing and commenting
on materials you find online, then trade secrets law will not have any real impact on
you. For a business to protect information under trade secrets law, the information
must be secret. If you can find a piece of information by searching the Internet, then in
all likelihood so can the company's competitors, and that information is not a trade
secret. If, on the other hand, you engage in​ ​investigative reporting or regularly rely on
confidential sources​, you should familiarize yourself with trade secrets law in order to
avoid potential liability​ and to stand up for yourself should someone send you a
cease-and-desist letter. There are two scenarios where trade secrets problems are
likely to come up; in legal terminology, this is when a court could find that you have
"misappropriated" a trade secret.

Scenario One​: You ​personally acquire a trade secret by improper means, such as theft,
trespass, hacking, or breach of your own employment contract, even if you do not
publish the trade secret​. This type of conduct is outside the scope of this guide. If you
are accused of engaging in such activities, we suggest that you seek ​immediate legal
assistance​. See the section on ​Finding Legal Help​ for some suggestions.

If someone were to discover or expose any trade secrets through illegal means, then
they would need to find a lawyer immediately as they will have many potential legal
issues.

Scenario Two:​ You ​publish secret information received from a source and you know
that the source acquired it through theft, hacking, or some other improper means, or
breached a duty of confidentiality by giving it to you​. This later situation could easily
come up if you rely on employee sources for information about a company. If you want
to rely on insider sources or are simply curious about what qualifies as a trade secret
and what activities may cause trade secret liability, please see ​Basics of a Trade Secret
Claim​.

The second way to get into legal trouble from trade secret issues, is to expose
information gained from a source that obtained it through illegal methods.

If you are considering publishing information that might be considered a trade secret,
don't be intimidated. ​Not every company document is a trade secret, and a business
ordinarily cannot stop you from publishing embarrassing -- but not secret or
economically valuable -- information​. Even if you publish a bona fide trade secret, ​the
First Amendment of the U.S. Constitution may protect you from having to take it down
and even from paying damages​, especially if you publish the trade secret in order to
report or comment on a matter of public concern. To illustrate both points, imagine
that a source inside the XYZ Tire Company provides you with a secret company
memorandum revealing a hazardous defect in the company's tires; you may have a
host of legal arguments why publishing that information is lawful, including that the
information in the memorandum is not a trade secret and that the First Amendment
protects your activity. Keep in mind, however, that the law is not clear in this area. If
you are interested in the legal protections the law may offer your publishing activities,
consult the ​Publishing Trade Secrets​ section.

The First Amendment will protect against most trade secret issues,and since not all
company documents concern trade secrets, there should not be too much fear in
exposing companies’ secrets.