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Trade secret protections available at both state, federal level

News and Notes Focused on the 3 Public Faces of IP Law

  • Brand Image Protection - Trademark Law
  • Visual Image Protection - Copyright Law
  • Personal Image Protection - Right of Publicity Law

The Image Protection Law blog has been created in order to share stories and information on the legal aspects of: 1) the marketplace reputation of a company or product captured in its trademark, 2) published or publicly-displayed artwork, photography, and any created visual design, and 3) use of a person's photograph or likeness for product promotion or other commercial purposes.

The "IP3" share at least one thing in common: Image is everything. In these posts let's look at what that means in the realm of intellectual property in the news, but let's also be prepared to explore if there's something more beyond "everything." Don't forget, the intellectual in "intellectual property" doesn't mean smart or brainy, although by nature true creators often are. The word is used to refer to any creation, i.e., a "product of the mind." While this blog will be regularly updated, you are encouraged to share your thoughts on these posts.

When many people think of intellectual property protections, they think of trademark, copyright and patent protection. While these protections are certainly important, there is another form of intellectual property protection that businesses actually rely on more often: trade secrets.

A trade secret is essentially valuable information a business makes reasonable efforts to keep confidential. States have long allowed businesses to enforce trade secrets in court, but federal law now protects trade secrets as well. Understanding how these protections compare allows businesses to make the best choice regarding the forum in which they seek to protect their trade secrets. 

California's Uniform Trade Secrets Act protects against trade secret misappropriation, consisting primarily of unauthorized use or disclosure. California law allows businesses to protect against both actual and threatened misappropriation of trade secrets.

Courts may prohibit future use of a trade secret by injunction.  In terms of monetary recovery, businesses seeking to protect a trade secret may be able to recover damages for actual losses caused by misappropriation, unjust enrichment to the extent it does not duplicate actual damages, or a reasonable royalty for the period of wrongful use. If the misappropriation was willful and malicious, punitive damages may be awarded as well.  

In order to take advantage of trade secret protection in California, a business is required to file a claim within three years after the misappropriation is discovered or within three years of when it should have been discovered with "reasonable diligence."

Until fairly recently, it was only at the state level that trade secrets could be enforced. Just last year, the federal Defend Trade Secrets Act was passed into law, giving businesses another avenue of enforcing trade secrets. In our next post, we'll look at some of the basic features of this law and some of the considerations that might go into choosing between state and federal trade secret protection

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