One challenge of running a business is knowing whether or not it’s right to pursue a particular strategy. In the area of intellectual property, California law provides protections for a wide array of things making it hard sometimes to identify how to categorize an asset. Is it a trade secret? Maybe it’s something that needs patenting. What’s the best way to protect a company’s asset value?
What constitutes a trade secret can vary. Generally speaking, a trade secret is any confidential information that gives you a competitive edge in your market. It might be an unpatented invention or process, a prototype design, or any non-public documents that contribute to your operation’s success.
What to do
It’s important to know that trade secret law is not the same as patent law. Obtaining a patent provides protection for certain unique things for a certain amount of time. A trade secret can be forever, if you succeed in keeping it secret. Here are some steps to consider:
- Identify that it’s a secret and worth keeping. If the information in question is already out there, it’s not a secret. Even if it is secure, it might not have potential value for the future.
- Be sure your people know. A written policy provided to all employees is recommended. This tells workers how tell what is secret and can be useful in litigation if it comes to that. It should include monitoring to ensure compliance.
- Practice need to know. The more people who know a secret, the less likely it will be kept. Limit disclosure based on what an employee needs to do the job.
- Ensure standard practice identifying secret documents. It might sound somewhat NSA-ish, but if you lack a standard method for identifying what is confidential and who is responsible for it, damaging leaks could result.
- Physically isolate what’s most important. What this should cost and how much energy to expend depends on the size of the company, but restricting access can prevent secret theft and aid in tracking. And don’t forget to secure computers, too.
- Use confidentiality agreements. The time may come when you turn to third parties to leverage full value of secrets. Extreme care in allowing access through licenses or otherwise is always wise. A signed agreement reinforces that you are serious about protecting interests.
Of course, if in doubt, consult an attorney.