How are your trade secrets protected?

For many businesses, one of its most valuable assets is its intellectual property portfolio. If your business is focused on technology, medical products or drugs, as many in the Boston area are, you probably hold many patents. While patents make up an important element of many businesses IP portfolio, they are only part of that portfolio.

Your trademarks and copyrights can be equally valuable, especially if your trademark is especially well known, like the Boston Red Socks “socks.” If you are a publisher, author or artist, your copyrights may be your most valuable asset. However, there is an additional category of your IP portfolio that may be overlooked, and that is your businesses trade secrets.

Trade secrets can cover virtually any element of your businesses intellectual property, and may appear similar to patents, but there are many differences. For one, trade secrets never expire, which is why the Coca-Cola Company has never patented their formula for Coke. They never have to disclose the recipe, which would be necessary if they patented the formula, and the patent protection would eventually expire, allowing many “new” cokes to appear in the market.

You may believe your business does not really have an item that would qualify as a trade secret, but you may be wrong. If you have client or customer lists, those lists are likely a trade secret and you would not want them disclosed or released to the public.

Trade secret protection is contractual. You should have in place with anyone who has access to these secrets confidentially agreements that bar them from releasing this information, and extend after they leave your employment.

Breach of these agreements by former employees can trigger complex business litigation if you believe they are using your trade secrets. A case involving former employees of Gillette, who now work for P&G, has resulted in such litigation.

Gillette alleges employees who worked with product development and research have taken their knowledge to P&G, breaching their confidentially agreement. This type of litigation has the added complexity of the need to ensure confidentiality of much of the subject matter of the litigation., “P&G sues former Gillette employees over alleged trade-secrets leak,” Barrett J. Brunsman, January 16, 2015