Trade secrets can differentiate and add value to a business without the expense and formality of applying for a patent. The Uniform Law Commission drafted the Uniform Trade Secrets Act (“UTSA”) in 1979 (since amended and supplemented) in order to better protect trade secrets for U.S. companies operating in multiple states. The UTSA aimed to create the same standards and remedies across state boundaries regarding the misappropriation of trade secrets, rather than applying the patchwork of laws that various states had created. To date, almost every state, the District of Columbia, Puerto Rico and the U.S. Virgin Islands has adopted the UTSA.
There are three general requirements for information to be considered a trade secret. Businesses should make sure that the following critera are met:
1) The information must actually be secret (i.e. it is the secret sauce -- something not generally known among, or readily accessible to, circles that normally deal with the kind of information in question);
2) It must have commercial value because it is a secret; and
3) The rightful holder of the information must have taken reasonable steps by the to keep it secret (e.g., through confidentiality agreements, keeping the recipe in a virtually or physically locked file, etc.).
Please contact us to make sure that you are appropriately protecting your business’ trade secrets!