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Protecting Your Trade Secrets

By definition, a trade secret can be almost anything that has economic value and provides a competitive advantage. A well-known example of a well-kept trade secret is the Coca-Cola formula. Since 1891, founder Asa Candler maintained strict policies to keep and protect the formula from the public. Each state has its own laws for protecting trade secrets, but all require that an owner take “reasonable steps” to safeguard the secrecy and confidentiality of the trade secret information; otherwise, the legal protections are lost. Additionally, federal law allows a trade secret owner to bring an action in federal court for trade secret theft: Defend Trade Secrets Act of 2016 (DTSA). The subject matter of trade secrets is broadly defined and includes recipes, formulas, technology, sales and distribution methods, consumer profiles, client and supplier lists, manufacturing processes, etc. TRADE SECRET v. PATENT Trade secrets may concern inventions or manufacturing processes that do not meet the patentability criteria and therefore can only be protected as trade secrets. For example, customer lists or manufacturing processes are not entitled to patent protection. However, trade secrets may concern inventions or processes that fulfill the patentability criteria, but there may be an advantage to protecting them as trade secrets. Some notable advantages of trade secrets include: Patents have a finite period for protection; but, trade secrets last for as long as they are kept secret. Securing a patent can be resource intensive, whereas trade secrets have immediate effect and no registration costs. Under trade secret law, no disclosure to a government authority is required. KEEPING TRADE SECRETS, SECRET The key to maintaining trade secret protection is...