REASONABLE STEPS TO PRESERVE EXISTENCE OF A TRADE SECRET

Given that a trade secret cannot exist in the absence of reasonable steps to preserve the secrecy or confidentiality of the subject mater, certain steps are highly advisable. In order to attain the benefit of trade secret protection, whether under the common law (in states such as New Jersey) or under the Uniform Trade Secrets Act (as in such states as Florida). Steps which have been deemed to be reasonable to meet the threshold of secrecy or confidentiality necessary to qualify for trade secret protection, either under the common law or where the Uniform Trade Secret Act is in force, include the following:

A. Steps To Preserve Existence Of A Trade Secret

1. Utilize non-disclosure agreements (NDAs) and the like with employees, colleagues, consultants and third parties.

2. Mark all business plans, documents, proposals and the like to which the trade secret is applicable as “Subject to Trade Secret” or “Confidential.”

3. Take action against employees who violate the secrecy terms of their employment or take legal action against a third party if it violates non-disclosure agreements.

4. Do not leave confidential or sensitive material in places which can be readily viewed by persons not having a “need to know.”

5. Limit access of employees, contractors, consultants and the like to specific aspects or elements of a trade secret or to the entire trade secret.

6. Employ appropriate security measures with respect to Internet and intranet communications.

7. Create security access levels which are job or project specific for employees, contractors, consultants and the like.

8. Lock-up sensitive materials when they are not in use.

9. Obtain clearly defined NDAs with independent consultants, contract manufacturers, engineers, artists, and the like involved in development of products or prototypes which embody the trade secret.

10. Require special passes for access to email containing materials subject to trade secrets.

11. Provide periodic memos to employees, staff, consultants and the like regarding sensitivity/confidentiality of trade secrets and the like.

12. Keep a log of all those having access to such sensitive information.

13. Mark any documents, and every page thereof, with a notice of confidentiality or statement that the subject matter thereof is subject to trade secret.

There are also certain acts which one should not do in order to preserve a trade secret.

B. These include:

1. Posting a description of the secret on a website, bulletin board or the like.2. Engaging in an act which makes the content thereof available to the public.

3. Demonstrating the trade secret, if it comprises a process, in front of customers or in a public media.

4. Discuss or display of the trade secret with the media, or with a public official or any third party who has not executed an NDA or otherwise acknowledged the confidentiality thereof.

5. Distributing or advertising a product that in any way embodies the trade secret.