Category Archives: Trade Secret

intangible business assets

Trade secrets stories often show up in the media after a valuable employee from one company jumps ship and goes to a competitor. The former company is worried – in many cases, rightfully so – that the employee will be taking valuable trade secrets to the company’s competitor. Companies need to aggressively protect their trade secrets both before and after the departure of an employee. Indeed, the law requires this for companies to be able to receive trade secrets protection. A trade secret has to meet three conditions: It has to be information of some sort (a formula, a business practice, a design or something along those lines) A company has to take reasonable measures to protect the secret (it must make some effort, in other words, to keep the secret a secret otherwise a court may find that it was too widely known) A company must get an economic…
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We have commented in the past about the difficulty companies often have convincing juries that a competitor stole trade secrets. With so many trade secrets today involving digital information like computer code and particular methods, it can be difficult to demonstrate theft of trade secrets in the absence of clear evidence. In a recent trade secrets case, DuPont did not appear to have that problem. Two weeks ago, a jury awarded the company almost $1 billion in damages. The case pitted DuPont against a South Korean company, Kolon, the defendant. Like many trade secrets theft cases, this one started with an ex-employee going to a competitor. Michael Mitchell worked in sales and marketing for Kevlar, a DuPont product. DuPont terminated him 2006, and Mitchell went to Kolon shortly thereafter. DuPont contacted the Commerce Department and the FBI, which investigated and eventually charged Mitchell with the theft of trade secrets. Mitchell…
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A trade secret battle playing itself out in state court here in California highlights the difficulties companies face in proving trade secrets theft. The plaintiffs and the defendants in the case are making completely opposite allegations, so it will be up to the jury to figure it all out it the end. The case pits financial firm Trust Company of the West (“TCW”) against a former, high-profile bond trader, Jeffrey Gundlach. What Gundlach allegedly stole is the difficulty of the case. Unlike a trade secret that is easy to understand – say, the secret and highly-guarded Coca-Cola formula – trade secrets for TCW and Gundlach are less obvious. TCW attorneys told the jury that if it were to print a list of the trade secrets that Gundlach stole, the list would be two and a half times the height of the Empire State building. Gundlach, on the other hand, denies…
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