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What are ‘reasonable measures’ for protecting trade secrets?

Mar 29, 2022 | Trade Secrets

Protecting trade secrets requires parties to take reasonable measures to keep the information in question private. However, the phrase “reasonable measures” can seem vague and subjective, creating confusion and vulnerabilities in a business’s intellectual property.

Examples of reasonable measures

There are several ways businesses can protect trade secrets. Some approaches are more effective than others, and courts may not consider certain efforts sufficient to provide adequate protection.

That said, some examples of measures that courts typically consider sufficiently protective can include:

  • Keeping sensitive information in password-protected digital files
  • Physically locking file cabinets containing trade secret information
  • Having employees with access sign confidentiality or non-compete agreements
  • Changing login credentials upon employee dismissal
  • Clearly labeling and identifying confidential information
  • Monitoring access and use of protected data
  • Restricting public access to the business
  • Requiring workers with access to attend training for how to handle trade secrets

These are just some of the relatively simple, cost-effective measures that can keep trade secrets private. And when businesses have these in place, any attempts to violate or circumvent them can trigger legal action.

Building a solid framework around proprietary information

If you have trade secrets to protect, putting these measures in place as soon as possible is crucial. To do this, business owners may want to consult:

  • Legal representatives
  • I.T. professionals
  • Human Resources managers
  • Security professionals

These parties can help business owners make informed decisions on securing their trade secrets adequately.

Unfortunately, there are people who will violate even the most aggressive protections. They might hack into digital files, misrepresent themselves or take protected information to use as leverage for a new job. In any of these cases, perpetrators can be liable for damages stemming from these violations.

However, keep in mind that to prevail in these legal claims, courts must find that the business had reasonable measures in place protecting trade secrets, to begin with. 

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