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Protecting Trade Secrets in the United States. 2007 US / China Legal Exchange (Xian, Beijing, Shanghai) Rex Hockaday, Caterpillar (China) Investment Co., Ltd. 2007 US/China Legal Exchange (Oct 22-26, 2007). Protecting Trade Secrets in the US. US Trade Secret Law

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Protecting trade secrets in the united states

Protecting Trade Secrets in the United States

2007 US / China Legal Exchange

(Xian, Beijing, Shanghai)

Rex Hockaday, Caterpillar (China) Investment Co., Ltd.

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us

Protecting Trade Secrets in the US

US Trade Secret Law

Enforcing Trade Secret Rights

Trade Secrets as Part of Your Business

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us1

Protecting Trade Secrets in the US

US Trade Secret Law

Enforcing Trade Secret Rights

Trade Secrets as Part of Your Business

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us2

Protecting Trade Secrets in the US

US Trade Secret Law

State Law

Common Law

Federal Law

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us3

Protecting Trade Secrets in the US

US Trade Secret Law

State Law. Uniform Trade Secrets Act (UTSA)

What is a Trade Secret (TS)

Misappropriation of Trade Secrets

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us4

Protecting Trade Secrets in the US

US Trade Secret Law

State Law. Uniform Trade Secrets Act (UTSA)

What is a Trade Secret

Information …

Independent economic value

Not generally known or readily ascertainable

Reasonable efforts to maintain secrecy

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us5

Protecting Trade Secrets in the US

US Trade Secret Law

State Law. Uniform Trade Secrets Act (UTSA)

What is a Trade Secret

Information …

Independent economic value

Not generally known or readily ascertainable

Reasonable efforts to maintain secrecy

  • technical & non-technical

  • physical & electronic

  • combinations

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us6

Protecting Trade Secrets in the US

US Trade Secret Law

State Law. Uniform Trade Secrets Act (UTSA)

What is a Trade Secret

Information …

Independent economic value

Not generally known or readily ascertainable

Reasonable efforts to maintain secrecy

  • actual or potential

  • to owner and others

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us7

Protecting Trade Secrets in the US

US Trade Secret Law

State Law. Uniform Trade Secrets Act (UTSA)

What is a Trade Secret

Information …

Independent economic value

Not generally known or readily ascertainable

Reasonable efforts to maintain secrecy

  • secret

  • not “absolutely” secret

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us8

Protecting Trade Secrets in the US

US Trade Secret Law

State Law. Uniform Trade Secrets Act (UTSA)

What is a Trade Secret

Information …

Independent economic value

Not generally known or readily ascertainable

Reasonable efforts to maintain secrecy

  • internal & external secrecy

  • nature & value of information

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us9

Protecting Trade Secrets in the US

US Trade Secret Law

State Law. Uniform Trade Secrets Act (UTSA)

Misappropriation of Trade Secrets (TS)

Acquisition of TS and know or have reason to know it was acquired by improper means, or

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us10

Protecting Trade Secrets in the US

US Trade Secret Law

State Law.Uniform Trade Secrets Act (UTSA)

Misappropriation of Trade Secrets (TS)

Use or disclosure of a TS by person who

used improper means to acquire knowledge of TS, or

knew or had reason to know TS was:

° derived by improper means,

° derived from/through person with duty to protect, or

° acquired in manner creating a duty to protect, or

before a material change in position, knew/reason to

know it was a TS acquired by accident or mistake

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us11

Protecting Trade Secrets in the US

US Trade Secret Law

Common Law. §757,Restatement of Torts (1939); and §§ 39-45, Restatement (Third) of Unfair Competition (1995)

What is a Trade Secret (TS)

Misappropriation of Trade Secrets

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us12

Protecting Trade Secrets in the US

US Trade Secret Law

Common Law. §757,Restatement of Torts (1939); and §§ 39-45, Restatement (Third) of Unfair Competition (1995)

What is a Trade Secret

Information …

Sufficiently valuable

Sufficiently secret

Provides economic advantage

Intended to be consistent with the definition of trade secrets in the UTSA.

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us13

Protecting Trade Secrets in the US

US Trade Secret Law

Common Law. §757,Restatement of Torts (1939); and §§ 39-45, Restatement (Third) of Unfair Competition (1995)

Misappropriation of Trade Secrets (TS)

Acquisition, use or disclosure of a trade secret

Wrongfulness (misappropriation)

Consistent with the UTSA.

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us14

Protecting Trade Secrets in the US

US Trade Secret Law

Federal Law

The Trade Secrets Act

The Computer Fraud and Abuse Act

The Economic Espionage Act of 1996

The National Stolen Property Act

Mail Fraud, Wire Fraud, etc.

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us15

Protecting Trade Secrets in the US

US Trade Secret Law

Enforcing Trade Secret Rights

Trade Secrets as Part of Your Business

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us16

Protecting Trade Secrets in the US

Enforcing Trade Secret Rights

Enforcement Authorities

Protecting Trade Secrets in Litigation

Case Studies

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us17

Protecting Trade Secrets in the US

Enforcing Trade Secret Rights

Enforcement Authorities

State Courts (TS Statute, common law, breach of contract)

Legal Relief

temporary & permanent injunctions

court-ordered affirmative actions

Equitable Relief

royalties

compensatory damages

punitive damages

Federal Courts (Statute, breach of contract)

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us18

Protecting Trade Secrets in the US

Enforcing Trade Secret Rights

Protecting Trade Secrets in Litigation

Request protective order during discovery

Request in-camera proceedings

Courts may seal records

Courts may order a person not to disclose alleged trade secrets without court approval

Always at risk—hard to “un-ring the bell”

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us19

Protecting Trade Secrets in the US

Enforcing Trade Secret Rights

Case Studies

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us20

Protecting Trade Secrets in the US

QUESTIONS / COMMENTS ?

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us21

Protecting Trade Secrets in the US

US Trade Secret Law

Enforcing Trade Secret Rights

Trade Secrets as Part of Your Business

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us22

Protecting Trade Secrets in the US

Trade Secrets as Part of Your Business

Importance of Protecting Trade Secrets

General Business Practices to Protect Trade Secrets

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us23

Protecting Trade Secrets in the US

Trade Secrets as Part of Your Business

Importance of Protecting Trade Secrets

Broadly defined, potentially everywhere

Define & differentiate your business

You can only protect what you know & understand

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us24

Protecting Trade Secrets in the US

Trade Secrets as Part of Your Business

General Business Practices to Protect TS’s

Identify & understand your [key] trade secrets

Protection linked to secrecy

Practical Protection Measures

Who is responsible for protection?

How do you protect responsibly?

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us25

Protecting Trade Secrets in the US

Trade Secrets as Part of Your Business

General Business Practices to Protect TS’s

Identify & understand your [key] trade secrets

What are your trade secrets?

Where are your trade secrets?

Why they are valuable?

Who knows about them?

How are you protecting them?

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us26

Protecting Trade Secrets in the US

Trade Secrets as Part of Your Business

General Business Practices to Protect TS’s

Identify & understand your [key] trade secrets

What are your trade secrets?

Where are your trade secrets?

Why they are valuable?

Who knows about them?

How are you protecting them?

  • what differentiates your products

  • what differentiates your business

  • what is “secret”

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us27

Protecting Trade Secrets in the US

Trade Secrets as Part of Your Business

General Business Practices to Protect TS’s

Identify & understand your [key] trade secrets

What are your trade secrets?

Where are your trade secrets?

Why they are valuable?

Who knows about them?

How are you protecting them?

  • manufacturing/R&D facilities

  • business centers

  • computer systems!

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us28

Protecting Trade Secrets in the US

Trade Secrets as Part of Your Business

General Business Practices to ProtectTS’s

Identify & understand your [key] trade secrets

What are your trade secrets?

Where are your trade secrets?

Why they are valuable?

Who knows about them?

How are you protecting them?

  • how much competitive advantage

  • how easy/expensive to protect

  • what is the life span

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us29

Protecting Trade Secrets in the US

Trade Secrets as Part of Your Business

General Business Practices to Protect TS’s

Identify & understand your [key] trade secrets

What are your trade secrets?

Where are your trade secrets?

Why they are valuable?

Who knows about them?

How are you protecting them?

  • how many people “need to know”

  • internally & externally

  • who should “own” them

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us30

Protecting Trade Secrets in the US

Trade Secrets as Part of Your Business

General Business Practices to ProtectTS’s

Identify & understand your [key] trade secrets

What are your trade secrets?

Where are your trade secrets?

Why they are valuable?

Who knows about them?

How are you protecting them?

  • responsible parties

  • processes & contracts

  • auditing

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us31

Protecting Trade Secrets in the US

Trade Secrets as Part of Your Business

General Business Practices to ProtectTS’s

Protection linked to secrecy

How secret (extent TS is known inside/outside the company)

Value of TS to company

Extent of protection measures

Cost to develop TS

Ease of acquisition/duplication

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us32

Protecting Trade Secrets in the US

Trade Secrets as Part of Your Business

General Business Practices to ProtectTS’s

Practical Protection Measures

“Reasonable under the circumstances”

Processes, documentation & contracts

Employees

Third parties

Business

Security (physical & systems)

Hide your secrets

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us33

Protecting Trade Secrets in the US

Trade Secrets as Part of Your Business

General Business Practices to ProtectTS’s

Who is responsible for protection?

Everyone is responsible to protect trade secrets

Executive leadership should take ultimate responsibility

Experienced managers should have direct responsibility

Everyone must feel responsible to protect trade secrets

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us34

Protecting Trade Secrets in the US

Trade Secrets as Part of Your Business

General Business Practices to Protect TS’s

How do you protect responsibly?

Review: “trade secrets” are very broadly defined

How many trade secrets can you afford to protect

Understand costs:

good business practices

incremental protection

Sell the value to the company and the relevant partners

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us35

Protecting Trade Secrets in the US

QUESTIONS / COMMENTS ?

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the us36

Protecting Trade Secrets in the US

Rex Hockaday

Senior Corporate Counsel

Manager, Asia Pacific IP Office

Caterpillar (China) Investment Co., Ltd.

Room 1701 China Life Tower

No. 16 Chaoyangmenwai Avenue

Beijing 100020, P.R. China

Phone:+86 (10) 5921 0595

Mobile:+86 139 1117 2352

Fax:+86 (10) 5921 0099

Email:[email protected]

2007 US/China Legal Exchange (Oct 22-26, 2007)


Protecting trade secrets in the united states1

Protecting Trade Secrets in the United States

2007 US / China Legal Exchange

(Xian, Beijing, Shanghai)

Rex Hockaday, Caterpillar (China) Investment Co., Ltd.

2007 US/China Legal Exchange (Oct 22-26, 2007)


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