What is a Trade Secret? (and How do I Protect It?)
You’ve probably heard someone refer to the “secret sauce” when talking about a new, improved product or process for making something. And you’ve probably also heard about the “secret formula” for the world-renowned soft-drink commonly known as Coca-Cola or just Coke. And maybe you’ve even wondered what are the eleven herbs and spices that make Kentucky Fried Chicken taste so good? And if any of this sounds familiar, then you might just already know more about trade secrets than you thought.
A trade secret is any information that (i) has commercial or economic value by virtue of the fact that it is not generally known by the public and (ii) is the subject of reasonable measures to safeguard the secrecy of the information. While the formula for Coke and the recipe for KFC fried chicken are relatively well-known trade secrets, there are many others that aren’t as familiar to most. For example, the algorithms for the best-seller list of the New York Times and Google searches, the recipes for Twinkies and the special sauce on a Big Mac, and the formulas for WD-40 and Listerine are all protected as trade secrets. Because the owners of these trade secrets decided to protect them as trade secrets - rather than as patents or copyrights - they have benefited from the advantages provided by trade secret protection, including the potentially indefinite duration of trade secret protection. ¹
While you might not have a novel algorithm that performs improved Internet searches or a new formula for combating halitosis, you might have one or more trade secrets that have commercial value and should, therefore, be protected. Maybe you have compiled a customer or contact list that you would not want your competitors to see? Or maybe you have marketing or other business plans, advertising campaigns, or price lists you would like to keep secret. If you manufacture products, then you probably have a wealth of drawings, designs, and “know-how” relating to the processes by which your products are made. If you develop software for control systems, then you likely have many protectible algorithms contained within your code. If you do any type of research or product development, you almost certainly have laboratory, beta, and/or field test data and results. Each of these forms of information may be protectible as valuable trade secrets and, as such, may provide you with a competitive advantage in the market.
¹ For a more detailed explanation of the benefits of trade secret protection, see our FAQs webpage at www.brightwiselaw.com/faqs.
So if you think you might have information that qualifies for trade secret protection, the question then becomes what do you need to do to protect your trade secret information? What exactly are reasonable measures to safeguard the secrecy of trade secret information? Unfortunately, the answer to that question is a fact-sensitive, relatively complex question, so you should seek counsel from an experienced trade secret attorney. Having said that, some common measures used to safeguard the secrecy of trade secret information include the following:
physical security such as locks, safes, and restricted physical area access;
digital security such as passwords, dual authentication, and restricted digital file access;
Confidentiality and Non-disclosure Agreements;
Employment Agreements; and,
periodic training.
If you have any questions about whether you have any trade secret information, whether you should protect your secret information as a trade secret (instead of seeking patent or copyright protection), or how you can best protect your trade secret secrets in order to optimize the value and competitive advantage realized by your secret information, please contact Paul at paul@brightwiselaw.com.
______________________________________________________________________________________________
Elevating Innovation to
COMPETITIVE ADVANTAGE
___________________________________________________________
Any Comments?
[Warning: Do not include any confidential and/or proprietary information in any comments posted on this IP Blog page. Including confidential and/or proprietary information in any such comments risks the waiver of any attorney-client and/or work product privileges that may otherwise apply to such information.]