Introduction
Welcome to the third edition of Jenner & Block's Trade Secret Update. Trade secret disputes continue to sit center-stage in state and federal courts with significant criminal and civil proceedings, whether it be eye-opening jury verdicts awarding hundreds of millions of dollars, or criminal prosecutions for trade secret theft appearing on the front page of national newspapers.
In the criminal context, the US Department of Justice continues to focus heavily on activities from China, resulting in numerous prosecutions of Chinese nationals for brazen theft of trade secrets. Prosecutions focused on China are expected to rise. But China is not the end of the story. Foreign nationals from other countries—as well as domestic actors—still pose a substantial threat to trade secrets belonging to US companies. The resulting DOJ prosecutions show the resources expended to protect those rights.
The civil context for trade secret actions has also remained in the limelight with some of the highest jury awards in recent years, showing that the stakes involved in trade secret disputes are some of the most serious faced by civil litigants.
This edition of the Trade Secret Update addresses developments in US trade secret law, discusses some of the most significant criminal and civil trade secret actions, and highlights particular interpretations of the Defend Trade Secrets Act (DTSA) and its effect on trade secret litigation since it took effect five years ago. We first describe some of the most notable recent trade secret civil decisions, including high nine-figure jury verdicts, other convincing defense wins, and reductions of awards through post-trial motions and on appeal. The Update also explains developments in the inevitable disclosure doctrine, what constitutes ownership of a trade secret to justify bringing an action, and the application of the Computer Fraud and Abuse Act where an actor exceeds his or her authority in accessing a computer system, as well as a number of issues specific to trade secret issues applying California law.
The Update also addresses international trade secret issues, such as extraterritorial application of the DTSA despite a presumption against such application, trade secret holders using the International Trade Commission forum to protect from misappropriation, and a primer on Japanese trade secret law.
What is indisputable is that trade secret issues must be front of mind for executives at nearly all US companies, or the harm to their businesses and their bottom line could be harrowing.
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Originally published March 24, 2021
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.