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IP Law: Trade Secrets

This guide provides a primer for trade secret law, practical guides for field work, and legal resources.

Trade Secrets: A Primer

Trade Secrets are defined by statute as: 

  • "Information" that 
  • "Independent economic value, actual or potential"
  • from "not being generally known to, and not being reasonably ascertainable" by "proper means by," other persons "who can obtain economic value from" its "disclosure or use" and
  • is the subject of "reasonable" efforts to maintain its secrecy. 

UTSA § 1(4); 18 U.S.C. § 1839(3). The classic example is the secret formula for Coca-Cola. The formula is information--how much of certain ingredients should be mixed and when-- has economic value--makes Coca-Cola billions of dollars-- and the formula is not known by competitors, nor can the formula be discovered through experimentation. And of course, the formula is kept safe--literally-- by being kept in a safe.

Trade Secret law was originally rooted in common law practices at the state level, but over the last century have been codified into statutes (both on the state and federal level) and has grown to protect a myriad of different pieces of information. While traditionally trade secret law did just that--protect secrets of the trade--the law has evolved to provide protections for various forms of information such as business methods, compilations, computer passwords, computer software, cost data, customer data, formulas, inventions, price date, and even social media contacts. Trade secret law often falls beneath unfair competition and is considered a form of intellectual property that has both state and federal statutory protections. Further, both the state and federal government have a robust collection of case law delving into the particulars of statutory interpretation.


How to use this Guide

Trade secret law is not scary or difficult. The key is to be organized and prepared. This guide was built to facilitate legal research following the Rombauer method. The Rombauer method is a dynamic, reliable, and flexible legal research methodology that focuses on building a reliable base of understanding and growing your knowledge in sustainable steps. 

The Rombauer Framework is:

  1. Preliminary analysis (aka get organized and get some context)
  2. Search for Statutes 
  3. Search for Mandatory Case Precedent 
  4. Search for Persuasive Case Precedent 
  5. Refine, Double-Check, and Update 

To best utilize this guide, we suggest beginning by reviewing the practical guide series provided by Bloomberg, Westlaw, or Lexis. Next, read one of the listed handbooks or practical materials (such as West's In a Nutshell series, or Lexis' Understanding Trademark Law). Once you have a solid understanding of the fundamentals, begin preparing your research query. Is your issue state or federal or both? Which statute[s] is your problem going to fall under? What are your key search terms? What element of trade secret law do you need to understand better to make your case? What are the best defenses to your argument? Or, for research purposes, what is the relevant legislative history behind this? Generate a list of questions and key terms. Then dive in. We suggest beginning with the 50-State Survey Series (in print or available online through Bloomberg Law). Or if it is a federal issue, beginning with the relevant statute and exploring the citators and citing sources linked to that statute. With proper preparation, you should know from your preliminary analysis which issues are at stake and what primary sources you need to explore for your issue. And, of course, don't forget to check the currentness of the statutes and cases and ensure you have the most up-to-date information before finishing your research.

For more, check out this article by the University of Washington School of Law.


Good luck, and have fun!

And remember:

"Keep it secret, keep it safe."



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