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Employers: Are your business' trade secrets being afforded protection under the new federal trade secret law?

There has been recent major trade secret reform that affects the protection afforded to trade secrets. Employers should become familiar with the Defend Trade Secrets Act of 2016 (DTSA) at it imposes new and additional notice obligations on employers and it affects the protection afforded to employers’ trade secrets.

One of the most significant attributes of the DTSA is that it federally codifies trade secret law. Previously, lawsuits for trade secret theft have been brought only in state courts under state law. The DTSA establishes a new federal cause of action for trade secret misappropriation. This is an important benefit to employers, especially those that operate nationally, as now plaintiff employers will have access to federal courts and federal courts will have jurisdiction to issue injunctive relief as well as award compensatory damages and exemplary damages (for willful and malicious misappropriation).

Additionally, the DTSA provides an important new tool for plaintiff employers to obtain an ex parte court order to seize a trade secret by law enforcement and bring it within the custody of the court.

However, the DTSA does not provide automatic protections for all employers. The DTSA imposes new and additional notice obligations on employers, which such notice is necessary for an employer to obtain an award of exemplary damages or attorneys’ fees under the DTSA in federal courts.

Thus, it is imperative that employers retain legal counsel to review and, if necessary, modify all existing all employment, confidentiality and proprietary ownership agreements to include a standard notification clause and/or to establish a corporate trade secret policy containing the required notification clause.

For more information about the DTSA and how to protect your business’ trade secrets, call us to speak with our knowledgeable Florida business litigation attorneys at Rosenthal Law Group today.