Law.com Subscribers SAVE 30%

Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.

The Intellectual Property StrategistFeaturesIntellectual PropertyLitigationTrade Secrets

Avoiding Trade Secret Losses During Corporate Collaboration

By Felix Eyzaguirre and Katherine D. Prescott
May 01, 2020

Effective corporate collaborations — whether close customer relationships, supplier partnerships or formal joint ventures — demand that sensitive information be shared. Without proper agreements and well-defined boundaries, however, those corporate collaborations can lead to loss of trade secret protection and entangle the parties in litigation.

Protect Trade Secrets Through Controlled Sharing Subject to Confidentiality Agreements

Generally, to be a trade secret, information must: 1) be secret, not generally known or readily ascertainable; 2) have value arising from the fact that it is secret; and 3) have been subject to reasonable steps to ensure that it remains secret. Therefore, when trade secret information is shared outside a company, including with customers, appropriate safeguards must be put in place to maintain that information as a trade secret. As the cases discussed below illustrate, it is fundamental that there be a well-scoped confidentiality agreement or non-disclosure agreement (NDA) in place before trade secrets are shared with collaborators and potential collaborators.

In Madison Oslin v. Interstate Res., No. MJG-12-3041, 2015 U.S. Dist. LEXIS 37587 (D. Md. Mar. 25, 2015), the court found the alleged trade secrets were not trade secrets in part because they had been shared with prospective and current customers without the protection of a confidentiality agreement. Similarly, in Prostar Wireless Group v. Domino's Pizza, 360 F. Supp. 3d  994 (N.D. Cal. 2018), the court found that the alleged trade secrets relating to the architecture of Prostar's pizza delivery tracking system were not secret, where Prostar had shared conceptual design overviews and technical specifications for its system with pizza and IT companies without nondisclosure agreements in place.

This premium content is locked for Entertainment Law & Finance subscribers only

  • Stay current on the latest information, rulings, regulations, and trends
  • Includes practical, must-have information on copyrights, royalties, AI, and more
  • Tap into expert guidance from top entertainment lawyers and experts

For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473

Read These Next
The Article 8 Opt In Image

The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.

Major Differences In UK, U.S. Copyright Laws Image

This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.

Beach Boys Songs Written Decades Ago Triggered Current Quarrel With Lawyers Image

There's current litigation in the ongoing Beach Boys litigation saga. A lawsuit filed in 2019 against Nevada residents Mike Love and his wife Jacquelyne in the U.S. District Court for the District of Nevada that alleges inaccurate payment by the Loves under the retainer agreement and seeks $84.5 million in damages.

Strategy vs. Tactics: Two Sides of a Difficult Coin Image

With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.

Transfer Tax Implications on Real Property Leases Image

The real property transfer tax does not apply to all leases, and understanding the tax rules of the applicable jurisdiction can allow parties to plan ahead to avoid unnecessary tax liability.