Trade Secret Protection - Jaeckle Fleischmann & Mugel, LLP

Often a company's intellectual property cannot be appropriately protected by patent or copyright laws; patent and copyright protection is limited in scope and time, and certain subject matter does not qualify for such protection. In those situations, it is imperative that a company take appropriate steps to protect valuable intellectual property as trade secrets.

Trade secrets - information that a company possesses that is not known outside the company and gives the company a competitive edge - can be an extremely valuable component of a company's intellectual property portfolio. Unlike patents that have a fixed term, trade secrets, which include such things as customer lists, marketing plans, manufacturing processes and formulas, can last potentially indefinitely so long as the trade secret remains secret. The decision whether to patent an invention or keep it as a trade secret is an important one. Considerations include, for example, the subject matter of the invention and the difficulty or ease in which it may be reverse engineered.

A key legal requirement to a successful trade secret program is that it be "reasonable under the circumstances". Federal and state trade secret laws dictate whether this standard has been met and will look to the policies and procedures the company has in place to safeguard their trade secrets. If the policies and procedures are found to be either too excessive or not strict enough, the company stands to lose its valuable trade secrets.