What Constitutes A Trade Secret?
Your trade secrets are your business’s most confidential and valuable assets, as they are what sets your New Jersey business apart from its competitors. While you should take the necessary measures to protect your intellectual property, you cannot always anticipate breaches. The law has protections in place to compensate businesses that are victims of intellectual property breaches. However, for the law to apply, the stolen information must meet the legal definition of a trade secret.
According to the Legal Information Institute of Cornell Law School, a trade secret, as defined by the Uniform Trade Secrets Act, is information that generates concrete or hypothetical independent economic value from the fact that it is not commonly known to or readily available by other persons. “Information” can include a pattern, formula, program, compilation, technique, method or process. A trade secret, under this definition, is also one that is the subject of significant efforts.
The Legal Information Institute also outlines the six factors used to determine whether information constitutes a trade secret prior to the development of the UTSA. Those six factors are as follows:
- The degree to which the information is available or known by individuals outside of your business
- The degree to which the information is available or known by those involved in your business, including employees
- How easy or difficult another person or entity can duplicate or acquire the information
- The value the information presents to your business or its competitors
- The amount of resources you expended to develop the trade secret
- The degree of measures taken to guard the information
This information is meant for purely educational purposes. It is not meant to serve as legal advice.
Understanding how this affects the small business economy is part of our job here at Santomassimo Davis LLP, as we primarily focus in providing expert Outside General Counsel for a variety of law firms and legal issues related to Corporate and Business Law in New Jersey, New York and Pennsylvania.
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