A trade secret is a form of intellectual property. It is defined as any information, process, formula, technique, or method that is not readily known by the public and provides an economic benefit to its holder. In order for information to keep its status as a trade secret, the holder must make reasonable efforts to preserve its confidentiality.
Unlike other forms of intellectual property, such as trademarks and patents, the items being protected by trade secret laws are not always immediately “visible” or discernible in physical form. They often consist of processes, methods, or “ways of doing things.” Thus, one way to gain a grasp of concept of a trade secret is to examine different examples of them.
Many different types of information and processes can be considered trade secrets. Some common examples of trade secrets are:
Popular examples of trade secrets include the recipe for Coca-Cola and the formula for WD-40. Trade secrets may also include items that a person or company has not chosen to patent yet, such as a new plant hybrid or mechanical invention.
Unlike copyrights and other types of intellectual property, one does not register their trade secrets with government agency. Instead, trade secret protection is typically secured through means such as contracts, non-disclosure agreements, non-compete forms, and other similar documents. These provide guidelines for people who are exposed to information regarding the trade secret to prevent them from sharing that information with anyone who may disseminate the information to the company’s competitors. A contract or agreement designed to protect the trade secret generally limits the person’s ability to share the information with others, which allows the trade secret to remain a secret.
Thus, trade secret protection terms should be stated specifically in the contract terms. Since there is no registration process for trade secrets, expiration of the protection must be stated specifically in the written documents if there is any expiration. Also, if the trade secret is released to the public or is no longer considered to be confidential, the holder will usually lose protection and exclusive rights to the secrets.
Trade secret misappropriation is a major legal issue and can lead to problems for various parties to the agreement. Misappropriation or theft of a trade secret can also lead to criminal consequences for the violating party. Thus, it is important that the terms for confidentiality are clearly stated in all documents and that all parties understand the terms.
Trade secrets are important for the operation of many business endeavors. You may need to hire an intellectual property attorney in your area if you need assistance with trade secret laws. Your attorney can provide you with legal research and advice to help you understand your rights with regard to a particular trade secret. If you have any legal disputes, or if you need to file a lawsuit, your lawyer can represent you during court proceedings.
Last Modified: 08-31-2015 04:03 PM PDTLaw Library Disclaimer
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