7015 College Blvd
Suite 375
Overland Park, KS 66211

M - F 8:30am - 5:00pm
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The Defend Trade Secrets Act of 2016

By Katherine Tracy

On May 11, 2016, President Barack Obama signed the the Defend Trade Secrets Act of 2016 into law. The DTSA makes it possible for trade secret owners to bring claims for trade secret misappropriation in federal court under a federal statute. The DTSA may expand protections to information not otherwise protected under state trade secret laws; provides for civil seizure of trade secret information if specific requirements are met; provides for civil remedies for misappropriation of trade secrets and recognizes protections from liability for whistle blowers.

A court may order civil seizure of trade secret information upon an affidavit or verified complaint. However, such seizures may require extraordinary circumstances. In such seizure cases, the Court will take possession of the trade secrets and a seizure hearing will be held. Beware, however, because damages, including attorney’s fees, are available to a defendant for wrongful seizure.

Civil remedies available under the DTSA include injunctions as long as the injunction does not seek to preclude employment. There may be other mechanisms available, aside from the DTSA, to preclude employment. A trade secret owner may also recover damages, including damages caused by the loss of the trade secret, unjust enrichment or a reasonable royalty for misappropriated trade secrets. Double damages and attorneys’ fees may also be recovered for willful and malicious misappropriation.

The DTSA also has immediate impact on existing and future non-disclosure agreements between employers and their employees. The DTSA protects employees from civil and criminal liability if an employee discloses trade secret information: in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney and solely for the purpose of reporting or investigating a suspected violation of law; or in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Additionally, employees may be permitted to disclose trade secrets under certain situations in the event the employee brings a retaliation claim against the employer related to the employee’s reporting of suspected violations of the law. Existing non-disclosure agreements may need to be revised to account for these provisions of the DTSA.

If you have questions about the DTSA or have a non-disclosure agreement and have questions about whether the non-disclosure provisions are enforceable in light of the DTSA, please contact us.

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913.345.2555

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7015 College Blvd, Suite 375 — Overland Park, KS 66211


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    M - F 8:30am - 5:00pm

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    7015 College Blvd
    Suite 375
    Overland Park, KS 66211