Trade Secret Protections at the Patent Office

The USPTO is hosting a free symposium on Trade Secret Protections – May 8, 2017, from 9 a.m. to 4 p.m. EDT at the Alexandria HQ as well as via webcast. More info here: https://www.uspto.gov/​learning-and-resources/​ip-policy/​enforcement/​trade-secret-symposium.

DTSA enforcement continues to primarily focus on charges against former employees who join a competitor.  In Santander Securities v. Gamche, 2017 WL 1208066 (E.D. Penn. April 2017), the case centers on Gary Gamche who left Santander and joined a competitor Citizens Securities as a financial advisor – taking with him a list of his clients.  Similarly, in Brand Energy v. Irex, the construction company claims its former employees stole its proprietary business information (target bids and potential customer information); joined competitor Irex; and began poaching business.  So far, there are only a few DTSA decisions. In Brand, the Pennsylvania District Court  recently denied the defendant’s 12(b)(6) motion to dismiss for failure to state a claim upon which relief may be granted – finding that the alleged use easily fits within very broad definition of misappropriation found in the new federal statute.

Although the DTSA is limited to post-enactment misappropriations, the court in Brand held that it can apply to “continuing misappropriation that occurs after the effective date.”   Following Adams Arms, LLC v. Unified Weapon Sys., Inc., 16–cv–1503, 2016 WL 5391394, at *5–7 (M.D. Fla. Sept. 27, 2016).

In addition to the DTSA claim, the court found that the RICO and CFAA claims had been appropriately pled.

CFAA (Computer Fraud and Abuse Act) is interesting in that it imposes liability on anyone who knowingly “accesses a … computer without authorization, or exceeds authorized access” of the computer.  Here, Brand’s theory is that of ‘indirect access.’ After leaving BRAND, the defendants convinced a current employee to access the database and provide information.  According to the judge here, the defendants can be seen as accessing the computer (albeit indirectly and non-electronically via the employee) without authorization.  The statutory justification for this outcome is the court’s conclusion that Congress could have particularly defined “access” as “personal access” or “direct access” but instead left the term broadly stated.

 

 

Brand Energy v. Irex.

Dennis Crouch

About Dennis Crouch

Law Professor at the University of Missouri School of Law. Co-director of the Center for Intellectual Property and Entrepreneurship.

9 thoughts on “Trade Secret Protections at the Patent Office

  1. So the PTO which was set up to be in the business of issuing patents in exchange for public disclosure of invention information is now also in the business of promoting efforts to prevent public disclosure of invention information.

    1. They want the disclosure of infos regulated by the gubmit. Which, of course they do. They’re a bureau aren’t they?

  2. According to the judge here, the defendants can be seen as accessing the computer (albeit indirectly and non-electronically via the employee) without authorization. The statutory justification for this outcome is the court’s conclusion that Congress could have particularly defined “access” as “personal access” or “direct access” but instead left the term broadly stated

    Absurd. The first word of the CFAA is “Whoever”

    The plain and ordinary meaning of “accessing a computer” does not mean receiving information from a person who accessed a computer. The receiver could not have clear knowledge that the CFAA would apply to that act.

    Of course, the act may have been the culmination of a conspiracy, so the receiver would have no reason to believe that they would be immune from the liability of theft by engaging another to do the stealing, but this extension of the CFAA makes any theft of information by any means a CFAA violation, since virtually all information starts or ends on a computer somewhere.

    1. And meanwhile the filthy rich sl im eb@alls who want to own the Internet are selling whatever information they can figure out how to collect from you to the highest bidders, no questions asked. And Republicans are working overtime to kick down whatever barriers stand in the way.

      What a great country.

      1. “And meanwhile the filthy rich sl im eb@alls who want to own the Internet”

        /Eyeroll

        “And Republicans are working overtime to kick down whatever barriers stand in the way.”

        Repeal one regulation with likely negligible effect and MM states that republicans are “working overtime to kick down barriers to people owning the interbuts”. Lolol.

        Keep the lols coming MM. You still plotting assaults agin whitey and whitey’s property?

        1. Repeal one regulation with likely negligible effect

          LOLOLOLOLOLOLOLOLOLOLOLOL

          And yet so very, very important to these rich white men in congress who otherwise excel at doing nothing and preventing anyone else from doing anything. So mysterious.

        2. whitey’s property

          A perfect summation of the US Supreme Courthouse. Well done.

          You still plotting assaults

          Of course. Are you and Milo still planning on coming to my hood with your Pimply Ped0 Luvvers Comedy Show?

          1. “Of course.”

            Any of your buddies plotting along with you?

            “Are you and Milo still planning on coming to my hood with your Pimply Ped0 Luvvers Comedy Show?”

            Brosefulous, when are you going to learn that there is only one side that is pro-P in their acronym?

  3. “wherein said device is installed in a hyperloop pod or track”

    File your applications now and “ride” along! Don’t be left behind in the rusting pile of robot cars.

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