Trade secret litigation is often times a difficult and intense area of business litigation for our Charleston business litigation lawyers. The most common matters that our business lawyer provide counsel are in regards to the enforcement of non-competition agreements, non-solicitation agreements and confidentiality agreement. We both challenge and defend such agreements by way of a lawsuit and/or negotiation. Trade secret litigation is often times a contentious and intense area of business litigation. The business or employer (who is typically the victim of trade secret theft) usually feels angry and betrayed, so there is a certain degree of heightened hostility. Conversely, those accused of trade secret theft, generally former employees, independent contractors, or business consultants, feel unfairly accused or prosecuted and may be worried about their livelihood and the ability to earn a living.
Definition of Trade Secret
The definition of trade secret is stated below. The language is derived from comment b of section 757 of the Restatement of Torts:
A trade secret may consist of any formula, pattern, device, or compilation of information which is used in one’s business, and which gives him an opportunity to obtain an advantage over competitors who do not know or use it. It may be a formula for chemical compound, a process of manufacturing, treating or preserving materials, a pattern for a machine or other device, or a list of customers…
One significant limitation on the definition of a trade secret is that it must relate to the continuing operation of a business. The following factors are customarily considered in determining the existence of a trade secret:
The extent to which the information is known by employes and other involved in the business;
The extent to which the information is known outside the business;
The extent of measures taken by the employer to guard the secrecy of the information;
The value of the information to the employer and to his or her competitors;
The amount and effort or finances expended by the employer in developing the information; and
The ease or difficulty with which the information could be properly acquired or duplicated by others.
After successfully establishing the existence of a trade secret, the injured party, generally the business or employer, must prove that the person accused of stealing the trade secret acquired the trade secret as a result of a confidential relationship.