Adams Law Group, llc

Taking a former employer’s “trade secrets” isn’t just an employment law issue.

The new economy, with its emphasis on innovation, has increased the risk of employers involving law enforcement in what usually amounts to civil employment matters.  Many employees are now “knowledge workers” who are selected because of their expertise in highly-skilled and highly-specialized fields.  These knowledge workers are engaging in fields that are purposefully innovative—that is—new ways of approaching problems or disrupting existing industries.

With business innovation comes the development of “trade secrets.” Trade secrets are practices, methods, or developments created by a business that the business takes steps to keep confidential.  Knowledge workers are given access to or help create these trade secrets.  Often, at the time a knowledge worker leaves an innovative company they will be tempted to begin a new enterprise, or sell what they’ve learned to a third party.

Non-compete agreements, non-disclosure agreements, and other employment contracts will usually already be in place to dissuade a leaving employee from utilizing their former company’s trade secrets.  These agreements are usually enforced with civil lawsuits.  However, government prosecutors may also take an interest in an employee taking (called misappropriating) trade secrets.  A few examples of the trade secrets that drew the government’s attention:

  • A Coca-Cola marketing plan. US v. Williams, 526 F. 3d 1312 – Court of Appeals, 11th Circuit 2008.
  • A unique way of manufacturing a pill. US v. Hsu, 155 F. 3d 189 – Court of Appeals, 3rd Circuit 1998.
  • A new process for applying hard coatings to the laminate contact surfaces of caul plates.  US v. Krumrei, 258 F. 3d 535 – Court of Appeals, 6th Circuit 2001.
  • A new acrylic adhesive formula.  US v. Yang, 281 F. 3d 534 – Court of Appeals, 6th Circuit 2002.
  • Microsoft Windows source code. US v. Genovese, 409 F. Supp. 2d 253 – Dist. Court, SD New York 2005.
  • Airplane brake designs stored on pirated AutoCad files. US v. Lange, 312 F. 3d 263 – Court of Appeals, 7th Circuit 2002.

If you are a knowledge worker who has been accused of misappropriating a trade secret, you can assume you are being investigated—certainly by your former employer and their attorneys—but also potentially by the government.  If you believe you are being investigated for a trade secret misappropriation you need to consult a knowledgeable attorney immediately.

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