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NYC Litigation Blog

Tuesday, April 17, 2018

Tips to Better Protect Your Trade Secrets

How can I protect my trade secrets even with ever growing technological advancements?

In today’s technology driven world, employers are increasingly vulnerable to theft of their trade secrets. Employees today can rapidly pass trade secrets through their cell phones or a USB. Even further, as more information moves to the digital cloud, misappropriation can happen nearly instantaneously. With such ease of theft, it has become all the more important for employers to take steps to protect their trade secrets through non-compete and trade secret agreements, as well as taking steps to limit access to trade secrets.

Use a Non-Compete Agreement and NDA

Non-compete agreements are created to protect employers from the threat posed by employees with insider knowledge leaving the company for a competitor. In recent years, non-compete agreements have come into disfavor in the courts. New York courts have held that non-compete agreements may be enforceable only in certain instances. To be valid, a non-compete agreement must be necessary to protect an employer’s legitimate business interests. Further, the agreement must be reasonable in time and scope, and not present an undue burden to the employee.

Employers will want to ensure their non-compete agreement is carefully crafted so as to protect trade secrets while not running afoul of current laws. Your employment law attorney will take steps to create a valid non-compete agreement that achieves your business interests.

In addition, or as an alternative to a non-compete agreement, you may wish to have your employees sign a trade secret agreement. This type of agreement is commonly termed a nondisclosure agreement or NDA. A nondisclosure agreement is a contract between you and the employee in which the employee promises to protect the confidentiality of secret information known to the employee during the employment.

Your NDA should define what constitutes confidential information, and what is excluded. It should also clarify the obligations of the employee. Most NDAs will contain a time period during which the employee cannot reveal the information. Violation of the NDA can come at a serious cost to the employee.

Restrict Access to Trade Secrets

Employers can further protect their trade secrets by limiting employee access to such secrets. Trade secrets should be disclosed only to those parties that need this information to complete their job. Files containing secret information should be restricted both in their physical and digital form. Your trade secret attorney will help you to develop a plan to protect your trade secrets to the fullest extent. Contact us today.


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