Protecting Trade Secrets Under Coronavirus COVID-19 Work From Home Policies

Proprietary information that belongs to a business can be considered a “trade secret” or  protected confidential information. The law provides protection for trade secrets.  These assets are a form of valuable business property or “intellectual property”.  Employees can be required to keep trade secrets confidential.  They must not to turn around and sell those secrets on the open market or give them to a competitor.

COVID-19 is having a huge impact on businesses. The government has issued stay-at-home orders.  Businesses have also implemented work-from-home policies for employees. These policies, however, may create new challenges for businesses in protecting their confidential information and trade secrets.

What is a Trade Secret?

In California, the trade secrets of a business are protected by the Uniform Trade Secret Act. Generally, a “trade secret” is any information that has economic value from not being known to the public.  The owner must  take reasonable efforts to maintain its secrecy. Examples of trade secrets include formulas, patterns, techniques and customer lists.

Factors to Consider

• Whether the information is known outside the business and how widely it is known.
• The extent to which company employees know of the trade secret.
• The measures used to protect the trade secret.
• The value the secret has both to the business and to competitors.
• The amount of money or effort that the company spent to develop the secret information.
• How difficult it would be to obtain or duplicate the information.

Protecting Trade Secrets While Employees Work From Home

Work-from-home policies protect the health and safety of the workforce and maintain business operations during the COVID-19 pandemic. Businesses implementing such policies should consider the following steps to limit risks to confidential information and trade secrets as employees work from home:

• Review existing company confidentiality practices and procedures. Businesses may already have in place written policies in place to protect its trade secrets. However, these policies were likely developed with a traditional workplace or office environment in mind, and therefore should be revised to address unique confidentiality risks posed by employees working from home.
• Businesses should institute a written confidentiality policy  one immediately.
• Adopt or review existing non-disclosure and confidentiality clauses in employment or vendor agreements.
• Adopt or review restrictions on employees sending or keeping confidential information or trade secrets on systems not authorized by the business, for example, personal email accounts, home computers and external hard drives
• Businesses should revisit existing restrictions on employee access to confidential information and trade secrets. For which employees is access to confidential information essential? Can the scope of accessible information be further limited?
• Use Non Disclosure Agreements (“NDA”).

Getting Legal Help

Your business should do everything possible to protect the trade secrets that are valuable to your organization. The Irvine business litigation and intellectual property lawyers at Brown & Charbonneau, LLP can help you to take steps to protect your proprietary information. We can assist in developing or evaluating company confidentiality policies, drafting and enforcement of agreements to protect trade secrets and help you to file a lawsuit and put the legal system to work in protecting your business interests. To learn more about how we can help, email us or give us a call today at 714-406-4397 to schedule a consultation and learn more about how we can help you.

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