Intellectual Property
Intellectual Property
Trade Secrets & Unfair Competition
Trade Secrets & Unfair Competition

Your company’s trade secrets can represent some of the most valuable business assets you own, so it’s vital that you take measures to protect those trade secrets. But that’s a task that’s much easier said than done, especially if you work in a competitive industry, particularly one with a relatively small pool of qualified employees.

After all, what’s to prevent a disgruntled employee from going to work for the competition, where he or she discloses your trade secrets, such as secret formulas, computer algorithms, or even client lists? Well, this is one area where key business contracts, such as non-disclosure agreements and non-compete agreements or restrictive covenants can be extremely useful.

But in addition to writing specific, non-ambiguous and comprehensive contracts, you need an experienced trade secrets and unfair competition lawyer to help you take measures to protect your company and your business interests. This includes taking prompt, decisive action, such as litigation in cases where your trade secrets are threatened.

What's the Definition of a Trade Secret?

The term “trade secret” can apply to a broad range of confidential information. In its most general sense, a trade secret is any piece of information that provides a business or individual with some sort of competitive advantage.

Trade secrets come in many forms, including:

  • a recipe, formula or compilation
  • a proprietary technique or manufacturing method
  • a piece of software, computer code or algorithm
  • a design or pattern
  • sales techniques/methods
  • distribution methods
  • client lists
  • supplier/wholesaler lists
  • a business or marketing strategy

Notably, some of these trade secrets can be patented, such as a recipe or formula, or a proprietary manufacturing technique/method. So, those items are typically afforded protection under patent law. Some other information may be protected under copyright laws (such as a document detailing a marketing method.)

But other trade secrets do not qualify for protection with a patent or copyright law, so it’s these items that are typically considered a trade secret that is covered under other business and intellectual property laws (also called IP laws).

What's Not Considered a Trade Secret?

There is some information that is not considered a trade secret. Generally, if the information is readily available to the public (and by extension, competitors), then this cannot be claimed as a trade secret.

For instance, you would typically be unable to claim your client list as a trade secret if you publicly post information about your clientele online or via social media. So, for instance, if a website design company were to post screenshots and links to each and every website they’ve designed, then they would generally be unable to claim this client list as a trade secret because that information has been released into the public domain.

What's Considered Unfair Competition?

Unfair competition laws cover a number of different elements. Examples of unfair competition practices include:

  • patent infringement
  • copyright or trademark infringement
  • misappropriation of trade secrets
  • trade libel, such as writing false information about a competitor company’s information

Another practice that is prohibited under unfair competition laws is known as tortious interference, which occurs when a one party convinces a person who has some sort of relationship with a competitor (such as a client, employee or even a business partner) to breach their contract or their duty to the competitor.

In short, unfair competition laws are designed to protect businesses from unfair business practices. Some antitrust laws also deal with matters of unfair competition.

How Can a Trade Secrets and Unfair Competition Lawyer Help My Business?

The laws governing unfair competition and trade secrets can be quite complex, and as a business owner, it can be quite challenging to interpret these laws in a way that’s meaningful and applicable to your precise situation or circumstances.

The team at Sandman Law works with business owners offering key legal advice and recommendations that will allow you to protect your business and its trade secrets, while simultaneously avoiding accusations of unfair competition.

Informally, business owners often call confidential know-how the "secret sauce" or "secret ingredient" to their operation. But there's actually an entire element of intellectual property law devoted to protecting information that provides a business or individual with a competitive advantage!