Keeping Secrets – A Practical Introduction to Trade Secret Law and Strategy, by Darin W. Synder and David S. Almeling, Oxford University Press, 2012
Some forms of intellectual property make headlines from time to time, like the recent Apple v. Samsung patent spat involving smart phone technology, and Rosetta Stone’s trademark fight involving Google’s AdWords. But rarely do patent and trademark cases approach the intrigue and novelesque quality of trade secret cases. The reasons are simple: most trade secret cases involve people—usually current or former employees—who were entrusted with a company’s most valuable confidential information, and who breached that trust for personal gain. According to the authors of Keeping Secrets, when that information is stolen and sold or used by thieves, the resulting cases are often scandalous and read like good spy novels.
While such matters make good fiction, the reality is anything but. Authors Snyder and Almeling report that the cost of trade secret theft may be as high as $300 billion per year. Litigation involving trade secrets has doubled each decade since the 1980s. Those statistics alone should make anyone charged with protecting a company’s secrets want to read Keeping Secrets. But it is the author’s warning at the end of the book that makes the most compelling argument for picking up a copy of the book: a company that ignores trade secrets does so at its peril.
Keeping Secrets is divided into three informative parts: (i) the basics, (ii) four keys to a successful trade secret strategy, and (iii) trade secrets in practice. The self-proclaimed “trade secret primer” lacks depth—it is nine short chapters long—but it makes up for it with informative and entertaining case studies, sharp examples of what not to do in the world of trade secret protection. For example, several case studies describe the disastrous results of companies failing to vet new employees with an eye toward trade secret protection and not requiring them to sign confidentiality agreements at the start of their employment. As the authors describe, studies show that confidentiality agreements between a company and its employees and between a company and third parties have the greatest impact in causing a court to find that a trade secret owner took sufficient measures to protect trade secrets. Without those measures, a thief may not be liable to the company whose secrets he stole.
Side Bar: Maryland, like most other states, adopted the Uniform Trade Secrets Act (available here). For more on the MUTSA, please see Theft of Trade Secrets: Causes of Action in Maryland, previously published on this website.
Like other forms of intellectual property, protecting trade secrets requires owners to be vigilant, argue Snyder and Almeling. It is not enough to merely protect intellection property rights by, for example, obtaining patents, registering trademarks, registering copyrights, and taking measures to secure trade secrets from the public. In Keeping Secrets, Snyder and Almeling suggest companies audit their trade secrets from time to time, and take other steps to identify whether a company’s secrets are leaking. If litigation is the only option, they provide several useful strategies for navigating the various decisions that inevitably arise in trade secret cases, and helpful tips for avoiding the common pitfalls.