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Elements of a trade secret claim and proving misappropriation

On Behalf of | May 10, 2019 | Intellectual Property

When a person possesses information that meets the legal definition of a protected trade secret, and if someone or some entity misappropriates that information for his or her or its own benefit, the owner of the intellectual property may file a trade secret claim. If successful, New York may fine and/or imprison the offender and award the plaintiff damages. However, the enjoy the remedies of a trade secret claim, the plaintiff must establish the elements of a successful claim and be able to prove misappropriation.

According to Cornell Law School Legal Information Institute, there are three essential elements of a trade secret claim. For one, the subject matter in question must qualify for protection under the Uniform Trade Secrets Act. Two, the owner of the intellectual property must prove that he or she took reasonable measures to protect the property from disclosure or misappropriation. Three, the holder must prove that someone or some entity wrongfully misappropriated or acquired the information.

The American Bar outlines what a person must prove to establish misappropriation. According to the paper, there are two ways to prove misappropriation. The first way is to show that an individual who has knowledge or should reasonably have knowledge of a property’s protected status acquired the information via improper means.

The second way is to prove that a person disclosed or used a trade secret without consent, either express or implied, from the owner of the trade secret. The person who disclosed the information must have used improper means to acquire the information; have known or had reason to know the information was secret when he or she acquired and/or used it; or, before a substantial change of job duties, knew or had reason to believe information was secretive and the acquisition of it was either through mistake or by accident.

Regardless of how a plaintiff attempts to prove misappropriation, he or she must establish “improper means.” One can establish this key element by showing, among other things, breach of a commercial non-disclosure agreement, breach of a confidentiality contract, breach of a license agreement, theft, improper enticement of another to breach privacy responsibilities or industrial espionage.