On May 11, President Obama signed into law the Defend Trade Secrets Act of 2016, giving more options for individuals and corporations to take action when their trade secrets are stolen.
The DTSA, which went into effect immediately, borrows heavily from the language of the Uniform Trade Secrets Act (UTSA), variations of which have been adopted by 47 states, including Florida. Even so, the DTSA contains substantial changes impacting clients and attorneys.
New Federal Cause of Action
The major feature of the DTSA is the ability of an owner of a trade secret to bring a private, civil action against theft, “if the trade secret is related to a product or service used in, or intended for use in, interstate or foreign commerce.” (18 U.S.C. § 1836(b)(1).) Previously, the only recourse was to file a civil complaint under state law or seek federal criminal charges under the Economic Espionage Act of 1996.
As a result, victims of trade secret theft have in hand a powerful tool allowing them to retrieve their stolen information. If a victim can meet a rigorous eight criteria test through affidavit or verified complaint, a district court can issue an ex parte order to seize certain property necessary to prevent the propagation or dissemination of misappropriated trade secrets.
Balancing Act
Yet, the DTSA attempts to strike a balance between the victim and the person accused of trade secret theft. While a victim can take action to remove the trade secret from the target’s possession, they must post a bond sufficient to pay any damages in the case of wrongful or excessive seizure. In addition, the DTSA prohibits the victim from accessing the seized property until after the court hearing, which protects the target should any of the information belong to the target. If the seizure was sought in bad faith, the DTSA gives the target the ability to sue for damages, including punitive damages.
Victims that prevail under the new civil cause of action can obtain an injunction, monetary damages, and exemplary damages of not more than two times the actual damages awarded and attorney’s fees.
Implications for Employment Agreements
There is an important difference between the DTSA and Florida’s UTSA. The DTSA requires an employer to provide notice to employees of certain immunities to be eligible for an award of exemplary damages and attorney’s fees against an employee. An employee is broadly defined in the Act and the notice requirement applies to all contracts and agreements that are entered into or updated after May 11.
State Law Not Preempted
The DTSA does not preempt Florida’s UTSA, but allows parties to bring claims under the UTSA, the DTSA, or both. The ability to bring a DTSA action together with a UTSA could save claims for exemplary damages and attorney’s fees in a case where a plaintiff failed to provide the necessary employee notice under the DTSA.
Overall, the DTSA provides a new set of options for victims of trade secret theft, increasing the value of trade secrets and providing individuals and businesses with more options for protecting their intellectual property.
Relevant Resources:
Search Blog
Follow Us
Recent Posts
- Federal Court Strikes Down the DOL’s Increased Salary Thresholds for Executive, Administrative, Professional, And Highly Compensated Employee Overtime Exemptions
- Breaking News: FinCEN Postpones Beneficial Ownership Reporting Deadlines for Companies Impacted by Recent Major Storms
- What You Need to Know About the U.S. Department of Transportation’s Build America TIFIA Loan
- Breaking News: Federal Judge Blocks Nationwide Implementation of the FTC’s New Rule Banning Noncompete Agreements
- September 4th is Almost Here: How Employers Can Prepare for the Upcoming Effective Date of the FTC’s Non-Compete Rule
- Florida’s New Statutory Home Warranty: What Home Builders Need to Know
- Orange County Proposes Temporary Suspension Ordinance on New Development Applications
- Raising the Roof: The U.S. Department of Labor Announces Rule Raising Salary Thresholds for Overtime Exemptions
- New Guidelines Anticipated Following HHS’s Health Cybersecurity Concept Paper
- SECURE 2.0 and Protecting Your Designated Beneficiaries
Popular Categories
- Employment and Labor
- Litigation (Labor & Employment)
- Construction
- Department of Labor
- Business of Real Estate
- Landlord-Tenant
- Construction Litigation
- Real Estate Law
- Salary
- Competition
- Cybersecurity
- Intellectual Property
- Appeals
- Construction
- Contracts
- Litigation
- Trusts and Estates
- Public Private Partnership
- Data Security
- Business
- Supreme Court
- Development/Land Use
- Technology
- IP Litigation
- Privacy
- Litigation (Appellate)
- Patents
- Business
- Public Finance
- Regulatory Compliance
- Florida Government Contracts
- Foreclosures
- Trademark
- Contracting
- Health Care
- Financial Institutions
- Compliance
- Estate planning
- International Dispute Resolution
- Florida Public Contracts
- Government Contracting
- Government Contracts
- Property Tax
- Government
- Conveyances
- Lease
- Appellate Blog
- Patent Office
- Insurance
- Wealth planning
- Federal Government Contracting
- Florida Bid Protests
- Public Contracts
- Infringement
- Cyber fraud
- Proposal Writing
- Public Bidding
- GAO
- Bid Protest
- International Arbitration and Litigation
- Americans with Disabilities Act
- Arbitration
- International
- Restrictive Covenants
- Grant Writing
- Copyright
- Promissory Notes
- Title
- Small Business
- Florida Procurement
- Public procurement
- Consumer Privacy
- PTAB
- General Liability
- Technology
- International Arbitration
- Liens and encumbrances
- Liens
- Creditor's Rights
- Bidding
- Attorneys' Fees
- Inter Partes Review
- Consumer Protection
- Power Generation
- Regulation
- Venue
- Contracting
- Government Vendor
- State Government Contracts
- Ad Valorem Assessments
- Florida Administrative Law
- Attorneys' Fees
- Florida Rules of Appellate Procedure
- Bankruptcy
- Florida Public Procurement
- Russia-Related Arbitration
- Mortgages
- FINRA
- Record on Appeal
- Rehearing
- Eviction
- Loan guaranties
- Patents - Assignor Estoppel
- Statute of limitations
- Statute of repose
- Dispute Resolution
- Liens
- Maritime
- Damages
- Briefing
- Request for Proposal
- Patents - Obviousness
- Commercial Brokerage
- Trade Secrets
- Bid Writing
- Florida Bidding Strategies
- Renewal
- Attorneys' Fees
- Florida County Lands
- Florida Economic Incentive Packages
- Jury Instructions
- Stay
- Design Professionals
- Certiorari
- Forum Selection
- email hacking
- Offers of Judgment
- Prevailing Party
- Settlements
- Assignment of Contract
- Assignment of Proceeds
- Designer Liability
- Lis Pendens
- Appellate Jurisdiction - Deadlines
- Banking
- Federal Rules of Appellate Procedure
- Finality
- Fintech
- Marketing/Advertising
- Preservation
- Unlicensed Contracting
- Evidence
- Evidence
- Expert
- Expert Science
- Federal Supply Schedule
- Florida Public Records Law
- Mootness
- Socio-Economic Programs
- Sunshine Law
- Veteran Owned Business
- Homestead
- Partnerships and LLCs
- Standing
Editors
- Of Counsel
- Partner
- Partner
- Partner
- Partner
- Partner
- Partner
- Associate
- Partner
- Partner
- Associate
- Partner
- Partner
- Partner
- Partner
- Senior Associate
- Partner
- Associate
- Partner
- Senior Associate
- Partner
- Associate
- Partner
- Partner
- Partner
- Partner
- Partner
- Partner
- Partner
- Partner
- Partner
- Partner
- Partner
- Partner
- Partner
- Partner
- Partner
- Partner
- Of Counsel
- Senior Associate
- Partner
- Associate
- Partner
- Partner
- Associate
- Partner
- Partner
- Partner
Archives
- November 2024
- October 2024
- September 2024
- August 2024
- June 2024
- May 2024
- February 2024
- November 2023
- August 2023
- July 2023
- June 2023
- May 2023
- April 2023
- February 2023
- January 2023
- December 2022
- November 2022
- October 2022
- September 2022
- August 2022
- July 2022
- June 2022
- May 2022
- April 2022
- March 2022
- February 2022
- January 2022
- December 2021
- October 2021
- September 2021
- August 2021
- July 2021
- June 2021
- May 2021
- April 2021
- March 2021
- February 2021
- January 2021
- December 2020
- October 2020
- September 2020
- August 2020
- July 2020
- June 2020
- May 2020
- April 2020
- March 2020
- February 2020
- January 2020
- October 2019
- August 2019
- July 2019
- May 2019
- April 2019
- March 2019
- February 2019
- January 2019
- December 2018
- November 2018
- October 2018
- September 2018
- August 2018
- July 2018
- June 2018
- May 2018
- April 2018
- March 2018
- February 2018
- January 2018
- December 2017
- November 2017
- October 2017
- September 2017
- August 2017
- July 2017
- June 2017
- May 2017
- April 2017
- March 2017
- February 2017
- January 2017
- December 2016
- November 2016
- October 2016
- September 2016
- August 2016
- July 2016
- June 2016
- May 2016
- April 2016
- March 2016