How Can a Business Protect a Trade Secret in Virginia?

  • By:Andrew P. Connors, Esq.

As soon as your business opens its doors, it is creating and using information that may have value by not being known to others.  This confidential information, called a “trade secret,” is subject to protection in Virginia by both the Virginia Uniform Trade Secrets Act and the the newly enacted federal Defend Trade Secrets Act. Obtaining trade secret protection in Virginia for things as simple as client lists and as complex as secret formulas (like how to make Coca-Cola) are of vital importance.  Such trade secrets can be protected from misappropriation, if your Virginia business plans appropriately to protect this important intellectual property.

What is a trade secret?

Maintaining trade secret protection in Virginia is not necessarily difficult–it merely requires proper legal planning.  Generally speaking, a trade secret under both the Virginia Uniform Trade Secret Act and the federal Defend Trade Secrets Act is any information, including a formula, pattern, compilation, program, device, method, technique, or process that (1) derives independent economic value by virtue of its secrecy and (2) is subject to reasonable means to maintain the secrecy of the information.

How can my Virginia business maintain a trade secret?

Any information that derives independent economic value by virtue of its secrecy should be kept secret to the best of your ability.  Usually, this means taking relatively simple steps and working with your Virginia attorney to implement a trade secret protection plan.  Employees, independent contractors, and other persons with access to the information must sign an appropriate non-disclosure agreement or confidentiality agreement that will withstand scrutiny in a Virginia or federal court.  Your business should also implement other policies, like “need-to-know” rules, marking documents “confidential,” ensuring limitations to physical access, and using passwords and encryption for electronic access. Documenting these procedures will be key to later proving trade secret status in court.

How can I stop trade secret misappropriation in Virginia?

Your business can enforce a trade secret subject to appropriate protection in Virginia after someone misappropriates the secret. In Virginia, an action for trade secret misappropriation provides you with a remedy beyond a simple contract breach (for instance, a breach of a confidentiality agreement by an employee), since the Virginia code and the federal Defend Trade Secrets Act (an extension of the federal Espionage Act) provide for separate rights of recovery, including injunctive relief, elevated damages, and attorneys’ fees.  Misappropriation, however, requires an unlawful act.  A breach of a confidentiality agreement or acquiring the secret through corporate espionage are examples of an unlawful act that will support trade secret misappropriation in Virginia.  Reverse engineering is an example of conduct that a court will generally view as lawful in Virginia.

Bottom line: protect and enforce your trade secrets

A Virginia law firm knowledgeable in trade secret law can help your business protect and enforce your trade secrets.  Do not overlook the protection of this valuable information.

Andrew P. Connors, Esq.
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Andrew P. Connors, Esq.

Partner & Attorney at Connors & Brenke
Mr. Connors is a Virginia business attorney focusing his practice in intellectual property law, contract law, business law, technology law, and civil litigation. His Virginia law firm, Connors and Brenke, provides legal counseling and representation to businesses throughout the Commonwealth of Virginia. Contact Connors & Brenke to request an appointment.
Andrew P. Connors, Esq.
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Posted in: Blog, Business Law, Intellectual Property Law, Litigation