Common Questions Related to the Defend Trade Secrets Act

I Am Not Bound By A Confidentiality Provision; Can I Use Secret Company Data At My Next Employer?

No. The Defend Trade Secrets Act states that any information which a company has and tries to protect, that is not publicly known and is of economic value to the company is a trade secret. Sharing any of this data with a future employer is potentially misappropriation of trade secrets under the Defend Trade Secrets Act. Most states also have parallel state law statutes which cover trade secret misappropriation.

I am Bound by a Confidentiality Provision, Can I Still Blow the Whistle?

Confidentiality provisions are common contracts that employees enter into. These provisions generally prohibit the disclosure of information to anyone outside the company. Employees who wish to blow the whistle on employer activities often face the question of whether they could be sued for such disclosures.

Federal law provides limited protection to employees who disclose illegal conduct, but that protection only applies to the extent the employee discloses the information (1) in confidence and; (2) to a government official or an attorney either directly or indirectly under the Defend Trade Secrets Act. The Defend Trade Secrets Act in essence provides an exception to confidentiality provisions provided disclosure is made under the right circumstances.

The Defend Trade Secrets Act only provides protection to companies who take “reasonable measures” to protect their data. Companies should take active measures to protect their confidential information, particularly company information located on computers.  Companies should also have return of documents policies and confidentiality clauses in place for employees who have access to company data. It is also useful for companies to have employee handbook provisions that cover the confidentiality of company data and deal with company devices and e-mails.

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