What is a trade secret, and how do I protect a trade secret?

A trade secret is any “information, including a formula, pattern, compilation, program, device, method, technique or process” that has actual or potential economic value by virtue of its being secret, and which you make “reasonable efforts” to maintain a secret.

Trade secret protection is sometimes the best option for intellectual property protection, because it can last forever. If you are actually able to sell and use your invention without revealing certain key details of the invention needed to practice it, then trade secret protection may be available. The key is ensuring that you are making “reasonable efforts” to maintain secrecy. Most of our clients who use trade secret protection engage us to review their procedures and ensure that their efforts to maintain secrecy are sufficient.

It is often not enough to simply download the first nondisclosure agreement you find off the Internet and assume this will protect your trade secret if you get everyone involved to sign it. For instance, we have seen many online nondisclosure agreements that only bind the other party to secrecy for a limited period of time—after this period the other party is free to practice the invention. This is a serious flaw in most cases and would completely undermine the inventor’s rights. There are other examples, but suffice it to say that we generally recommend having an attorney draft, or at least review and edit, any nondisclosure or other secrecy agreement.

One risk of relying on trade secret protection is that it does not protect against copying if another party is able to uncover your secret through reverse engineering. Accordingly, if your invention is a mechanical device, it is very likely that it can be disassembled and reverse engineered. If your invention is a complex formula for a new adhesive, or a complex process that is always performed in secrecy, then your invention is more likely to be a potential option for trade secrecy protection.

We offer:

  • Preparation of nondisclosure and other secrecy-related agreements
  • General consulting and assistance related to preserving trade secret protection

Please contact us to discuss trade secret law and to schedule an appointment.