Thursday, February 14, 2013

B.A.F.F.L.E.D. Law

Trouble with Trade Secrets?

In this post from April 2012, we gave you a rundown on trade secrets, and their place in fashion law, technology, and intellectual property in general.  Today, we are giving you the rubric for consideration, when you feel like your brand’s secrets may have been shared.

First, you have to be sure you actually have a trade secret.  To be considered a trade secret, your process or strategy must actually be a secret, and something setting your product apart from others.  It should not be obvious, because if it is, others would easily be able to detect it and use it—negating the secrecy. Great examples are the special sauce on the Big Mac, the secret ingredient in Coca-Cola, or a washing/treating method for fabrics.

Further, you have to validate things like:

     -Financial value
       -What was done to protect the secret and whether it was reasonable?
       -Were time and money spent on development of the secret, and keeping it private?

Next, you must determine what law is applicable.  This will be based on either the state your company is housed, or the state where the compromise took place. 

Once you’ve figured these things out, the rest will be in the hands of an attorney.  They should be looking to find out whether there was an unfair head start for the defendant to steal your secret and what the equities are.  The 2 of you will also have to determine what kind of relief you’d like to receive; an injunction stopping the defendant from using your secret, damages for their unauthorized use, or both.  The considerations above will help you figure this one out.

In addition to the trade secret-based matters, you will also have to consider things like employment contracts, policies, and conflict of laws materials.  Did you have your employees sign an agreement stating they would keep the secrets private?  Did they know the secret was actually a secret?  Have you shared disciplinary procedures with them for violating your policies?  Do you know who had a hand in sharing the secret?  And finally, are the laws different in the state where the infringement occurred—if it’s a different state than yours?

Surely some of these things are totally for the lawyer to figure out.  However, you should always have as much knowledge on protecting your brand as possible.  The more you know, the safer your brand and products will be.  

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