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3 Reasons Why The Defend Trade Secrets Act Will Help U.S. Manufacturers Protect IP

By Drew Greenblatt

Trade secrets – including manufacturing designs & processes, customer lists and R&D information – are the ‘secret sauce’ of manufacturing competitiveness.

Trade secrets – including manufacturing designs & processes, customer lists and R&D information – are the ‘secret sauce’ of manufacturing competitiveness. Yet every day, unscrupulous competitors and rogue employees steal our trade secrets to the tune hundreds of billions of dollars each year. This theft, whether it be through cyber-attack, espionage or other means, undermines fair competition, reduces return on investments and kills U.S. jobs.

Companies are taking steps to secure their IT systems and protect their trade secrets – requiring non-disclosure agreements, limiting exposure to business partners and restricting employee access, installing forensic software programs that track downloads, and educating employees on the basics of IP protection –  but more must be done.

If U.S. firms are to compete in the global marketplace and create jobs here at home, current laws must be updated to reflect the sophisticated nature of the threats. Here are 3 reasons why Congress should create a federal civil cause of action for trade secrets misappropriation pass the Defend Trade Secrets Act (DTSA):

1)Ease 

Unlike other forms of IP — including patents, trademarks and copyrights — trade secrets are not currently protected with a federal civil remedy. Current trade secret laws vary from state to state. The bill would create a federal civil cause of action for trade secret misappropriation and allow manufacturers to leverage the federal courts when interstate trade secret theft is discovered, avoiding the time-consuming and costly process of going through multiple state courts.

2) Speed

My factory in Baltimore is less than four-hours from seven major international airports in five different states. Unlike State-based law enforcement officials who are confined to their local jurisdictions, Federal agents are permitted to cross state lines to pursue perpetrators nationwide therefore increasing the speed and likelihood of preventing this valuable data from leaving the country permanently.

3)Flexibility

The bill does not preempt state law therefore preserving the flexibility and legal options of manufacturers. Trade secret owners can continue to rely on the traditional state law of trade secrets while benefiting from significant efficiencies under the Act.

The Senate is scheduled to vote on final passage of the legislation on Monday, April 4th. The Senate Judiciary Committee approved the bill unanimously on January 28, 2016 and it currently has 64 cosponsors. Please call your Senator today to get this done.

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