If you are a business owner who has a product or service that is different than anyone else, you may have a legally protected “trade secret.” These are the secret sauce that makes your product or service unique and different than anyone else’s in your industry. Officially, a trade secret is legally protected intellectual property that is owned by the business and can include processes of production, designs or patterns, formulas, methods, or some combination of any of those. Trade secrets are exactly that — secret! They are not known or easily ascertainable by other businesses, thereby producing an economic advantage over your competitors.  

Types of Trade Secrets in Need of Protection

If another person or business somehow discovers your trade secret and discloses or reveals it without your consent in California, it is considered trade secret infringement, also known as misappropriation. Yours is likely guarded and confidential as a valuable asset of your business. Some trade secrets examples can include, but are not limited to, the following: 

  • Formulas or recipes
  • Software or hardware
  • Marketing techniques or information 
  • Process or technique to make a good or service
  • Any other business traits related to a company that makes their product or service unique

Patent Protection vs. Trade Secret Protection

Oftentimes business owners will apply for a patent for their unique trade secret for legal protection. However, there are cases in which even if your trade secret may be a viable candidate for a patent, as a business owner, you may decide to keep it as a trade secret and forgo patent protection.  

While patents protect your business secret, they only offer protection for a limited time. Conversely, trade secrets can be kept confidential forever. Additionally, to keep a trade secret, no legal requirements are needed as they are when obtaining a patent. 

However, patents are proven ways to protect your claim to a business operation, service, or unique trait related to your company.  Without patent protection, some person could painstakingly analyze and dissect your good, product or service and actually be able to determine what makes it unique, and then use it for his or her own commercial profit.  

Contacting an experienced business attorney can help you understand your rights, and help you make these legal decisions with confidence.. 

Trade Secret Misappropriation

However, you do not need a patent to be protected as a business owner in California with respect to your trade secret. If someone either inappropriately or illegally discovers and obtains a trade secret of your business, it is called trade secret infringement, or misappropriation. Because this can financially devastate your business, the state of California has established strict laws that govern trade secret infringement.  

Specifically, California’s trade secret regulations are found at Cal. Civil Code § § 3426-3426.11.  Additionally, under federal law, The Economic Espionage Act of 1996 makes misappropriation of trade secrets a federal crime. Whether prosecuted in state or federal court, it is a serious crime. 

Contact Coepio Legal

If you are a business owner in California and your trade secrets have been misappropriated, contacting an experienced business attorney can help you understand your rights and learn your options for legal recourse. 

Coepio Legal specializes in business legal advice for business owners, especially in San Francisco. Being a business owner carries with it a great deal of responsibility and obligations. You worked hard to create a unique product, and it deserves protection. As experienced business attorneys, we can help. Contact us today.