Trade Secrets - News

The song goes on as before: employees moving between competitors means litigation.

Clean Technology Intellectual-Property Claims On The Rise

Employees moving among these companies will cause more trade-secret lawsuits, said Bob O'Connor, co-head of Wilson Sonsini Goodrich & Rosati's clean- technology practice and a partner with the firm.

"Presently there is a tremendous amount of employee mobility, and with that comes the potential that information employees gain from a prior employer would be the kind of information that prior employer would not want to see in the hands of a new employer," O'Connor said.

The question remains: what has the first employer done to protect itself? Non-compete agreements, garden leave provisions, and the like are a must, but even more importantly are the security measures taken by the first employer.

Read Picture This for an interesting slant on those security measures:

The same urge is felt at businesses such as Samsung Electronics, where the desire to protect trade secrets has led to a ban on camera-phones inside some company facilities. U.S. federal courts also ban the devices, and sports teams are telling fans they can't use them to take videos at games.

Such efforts are, at best, fingers in the dike and, at worst, may fool corporate executives and government officials into believing they've actually accomplished something. Here's why: It takes very little effort to find a "spy shop"—a store selling all kinds of cloak-and-dagger stuff. The proprietor will be happy to sell you a camera that replaces the top button on your shirt, or one that fits nicely into your briefcase, giving you the same hidden-camera abilities that local television news programs so cheerfully demonstrate when they're looking for a ratings boost.

***

Companies also need to recognize that insiders, not outsiders, are the more serious threats. Then they need to work on policies that protect the information that simply must be kept secret without discouraging everyday business.

I'd urge people in authority to consider the possibility that some of the most closely guarded information would be better off in the public sphere. This is unquestionably true for government-held information, where the penchant for secrecy is frequently a tactic to keep taxpayers and political opponents from learning the details of mismanagement, or worse. It's likely true in companies as well, where information that might be used by competitors could well prove more valuable if made available to assist customers and investors in making better decisions. It might even help the company improve its products and services.