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"LAWCHEK® Intellectual Property"
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reproduction, use, or disclosure of this work shall be |
What steps should I take to protect my trade secrets? |
Protection
of a trade secret generally requires "efforts that are reasonable
under the circumstances to maintain its secrecy."
Uniform Trade Secrets Act § 1(4)(ii) (1985).
Steps that should be considered to maintain the secrecy of a
trade secret include:
(1)
Physical Security.
The trade secret owner should provide physical security to limit
access to the trade secret.
Examples of such measures include: locked and/or guarded
entrances; a locked location for trade secret documents with access
granted based upon a "need-to-know" basis only; physically
covering equipment embodying trade secret information when not in use;
employee badges coded and policed for varying levels of access; visitor
badges limiting access to areas containing trade secrets; a log book for
visitors and visitor escorts; a "clean desk" policy which
requires removal of secret work in progress during any absences (e.g.,
lunch, bathroom, overnight and vacation); and the use of passwords in
software to limit access and a policy requiring employees to frequently
change passwords.
(2)
Document Handling Policy.
The trade secret holder should promulgate and enforce a uniform
document handling policy, including: shredding all waste (discarded
drawings, plans, specifications, etc.) and destroying all non-paper
waste produced from trade secrets; locking copy machines after hours;
marking documents "Confidential"; using paper with preprinted
proprietary notice for all drawings, specifications and technical
reports; requiring management approval to copy a document marked
"Confidential" and educating clerical staff to never violate
this policy; and establishing an inspection and approval process for all
outgoing materials to make certain that no trade secrets are
inadvertently disclosed.
(3)
Employee Education.
The trade secret holder should adopt a policy of employee
education addressing the importance of trade secrets and identifying
trade secret material, and the policy should be reflected in employee
handbooks or manuals.
(4) Employment Agreements.
Employment agreements should have a nondisclosure of trade
secrets clause, and, for particular employees, a noncompetition
agreement.
(5)
Nondisclosure Agreements.
Nondisclosure agreements should be used with all outside entities
receiving or having access to trade secrets.
Outside entities include vendors, consultants, suppliers,
subcontractors, etc.
(6)
Pre-employment Interviews.
Pre-employment interviews with prospective employees can help
avoid potential liability.
The pre-employment interview should include:
an oral review of the employment agreement to ensure that the
employee understands the relevant trade secret clauses; a statement to
the prospective employee that signing the employment agreement is a
condition of employment; a statement from the prospective employee that
employment will be commenced without disclosure of any previous
employer's trade secrets.
(7)
Employee Termination Procedures.
Finally, appropriate employee termination procedures can prevent
trade secrets from leaving with former employees.
An exit interview should always be conducted, no matter how
uncomfortable the situation.
Exit interviews should include:
reminding the employee orally and in writing of the continuing
nature of the nondisclosure provisions of the employment agreement;
identifying and advising the employee of specific trade secrets; and
identifying the employee's new employer. |
This is not a substitute for legal
advice. An
attorney must be consulted.
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