Lawmakers, Industry Tout Trade Secret Protections in Newly-Introduced Legislation
The expansion of civil litigation options for owners of trade secrets that allege their intellectual property has been infringed, a component of the Defend Trade Secrets Act of 2014, would benefit U.S. firms of all sizes, said President of Marlin Steel Wire Products Drew Greenblatt in testimony before the Senate Judiciary Subcommittee on Crime and Terrorism on May 13. The legislation (here) was formally introduced on May 12 by Sens. Chris Coons, D-Del., and Orrin Hatch, R-Utah. Trade secrets include everything from manufacturing formulas to clientele databases.
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“Trade secrets are not exclusive rights. Once disclosed, their value is lost forever. Theft has a real, measurable, real-world impact. It costs good-paying U.S. jobs and can even put entire businesses at risk,” said Greenblatt, while calling for more inter-agency collaboration to enforce trade secret protection. “We need a comprehensive, integrated push. The FBI, Justice, Customs and other agencies must work together to increase investigations and prosecutions, track down illicit gains and deliver real-time information to businesses about cyber threats and how to respond.”
The theft of trade secrets eliminates U.S. firms’ competitive edge, said Peter Hoffman, vice president of intellectual property management at The Boeing Company. “The theft of these trade secrets enables competitors to move directly into the production of competing knock-off products, thereby avoiding the investments and risks that the U.S. innovator must shoulder to bring a product to market,” said Hoffman in testimony. “And this is not just a concern for big businesses. Middle and small-size companies that rely on trade secrets have as much or more to fear as we do, particularly if their survival depends on a single product or service.”
The legislation would also be a critical improvement on recently-passed trade secrets laws, said Judiciary Committee Chairman Patrick Leahy, D-Vt. “American businesses often choose to rely on trade secret protection over other forms of intellectual property protection, allowing them to shield commercially valuable information from their competitors,” said Leahy at the hearing. “For that choice to remain viable, we must ensure that our laws protect trade secrets from theft and meaningfully deter and punish economic espionage.”