New law places focus on global trade secret theft

DTSA allows a trade secret owner to apply for the seizure of misappropriated things.

The Dollar Business Bureau

The Defend Trade Secrets Act of 2016 (DTSA) that was passed by the US Congress last month is expected to be signed by President Obama very soon. This act has come mostly because of the congressional concerns over the global economic espionage.

According to legal experts, the weak protection of trade secrets within the purview of the World Trade Organization (WTO) is the main reason for the congressional demand for action on this law. Also there is no organisation, international law or treaty to protect the trade secrets.

Scott McDonald and Jackie Johnson, attorneys at a law firm Littler Mendelson informed that the US has partly gained support from international jurisdictions in preserving trade secrets. This is mainly because it does not possess a federal civil statute for reference in enforcing similar laws by its treaty partners. The DTSA is the solution for this problem, they commented.

The DTSA allows a trade secret owner to apply for the seizure of misappropriated things without the other party’s knowledge. It is designed to be utilised in instances where a defendant is seeking to go away from the country. The DTSA also needs the Attorney General to prepare a biannual report to the House and Senate Judiciary Committees on global trade secret theft affecting the US firms.

The report will include recommendations for legislative and executive actions to address the challenges along with informative material for the US firms to protect themselves, according to McDonald and Johnson. The main provision of the DTSA is to offer a new federal court civil remedy for acts of misappropriating the trade secrets.

Other key features of the DTSA include uniform definitions for the trade secrets and misappropriation, companies can apply for an injunction and sue for double amount of the damages. The legislation also provides protection from prosecution for the whistle-blowers. Also it doesn’t eliminate the US state law remedies related to the trade secrets.


The Dollar Business Bureau - May 12, 2016 12:00 IST