Trade secrets are supposed to be just that-secret. Trade secrets should be protected through agreement, limited access, marking as such. All of these efforts are adopted with a goal to keep proprietary information away from competitors. However, in one recent case, even though a company had gone through all the measures described above, the court still ruled them as no longer being secret.
In Fleetwood Packaging v. Hein, Fleetwood accused a former employee of its parent company, Signode Industrial Group, of stealing company trade secrets along with several important customers. The former employee had been discovered to have downloaded company confidential information, including contribution reports which included pricing information, and discounts. The court found the Fleetwood had attempted to protect its contribution reports through the execution of confidentiality agreements, limiting employee access to information and marking appropriate documents confidential. However, Fleetwood was also found to have shared this information with its customers! Because the customers were not part of Fleetwood any trade secret protection available was negated and the cause of action related to those reports was dismissed.
What’s the take away here? Treat your trade secrets as such-secret. Don’t share them with your customers or anyone else outside of your organization with a properly executed confidentiality agreement. Limit access to your proprietary information and monitor the access to detect any sudden and unauthorized or unnecessary downloads. In addition, be sure to mark all appropriate documents, including things such as white boards, demo products, etc. as “proprietary” or “confidential.”
Protecting proprietary information is critical to any organization. Having the right person to help you make those decisions is important. The Law Office of Kathleen Lynch PLLC is designed to help businesses such as yours keep ahead of the game. The first telephone consultation is free. Email us at firstname.lastname@example.org.