Rights Against Third Parties

A trade secret owner also wants to protect his/her trade secrets from the unauthorized disclosure and/or use by a third party—that is, a party to whom the trade secret owner did not directly disclose the information. This situation most frequently arises when an employee of the trade secret owner changes jobs and the former employer/trade secret owner wishes to prevent the new employer from disclosing and/or using the trade secrets that the employee learned during his/her prior employment.

A trade secret owner may assert a misappropriation claim against a third party to prevent or remedy unauthorized disclosure and/or use by a third party when the third party knows that the information is considered to be a trade secret and the information was disclosed to the third party through a breach of duty (either by virtue of a contract or by a special relationship/implied contract owed to the trade secret owner).

Additional Rights of a Trade Secret Owner

The owner of a trade secret also possesses the right to prevent individuals who learn the trade secret through improper means from disclosure and/or use of the information. According to the law, "improper means" includes obtaining another's trade secrets through (1) illegal activities, (2) fraud and misrepresentation, and (3) legal but improper means, such as industrial espionage or other extraordinary measures.

Rights to Use Another's Trade Secrets

A party can learn, obtain, and use another's trade secret in three lawful ways. First, a party may independently discover another's trade secret; trade secret law does not give a trade secret owner rights against one who learns the secret through independent invention. Second, a party may properly "reverse engineer" a trade secret in order to learn it. Finally, a party can learn and use another's trade secret through a disclosure to it which is not in breach of a contract or special relationship or with knowledge of such a breach.

REFERENCES

Advisory Commission on Patent Law Reform. 1992. A Report to the Secretary of Commerce. August. Washington, D.C.



The National Academies | 500 Fifth St. N.W. | Washington, D.C. 20001
Copyright © National Academy of Sciences. All rights reserved.
Terms of Use and Privacy Statement