Bruzga & Associates

“Trade secret” means confidential business information that is of substantial economic value, and which is not readily ascertainable or is not generally known to the public. For example, the Coca-Cola Company’s most valuable trade secret is its cola drink recipe. Other examples of trade secrets include customer lists, marketing strategies, proprietary devices, formulations and manufacturing processes.

Three key reasons to protect trade secrets are:

ā€¢ If you fail to protect your company’s confidential information, your competitors or ex-employees may misappropriate the same for their personal advantage;

ā€¢ Certain proprietary inventions and formulations of your company may not be patentable. But, you may then derive commercial value by protecting them as trade secrets; or

ā€¢ You may wish to protect your confidential information for a period beyond the allowed 20 years of patent protection. In such cases, it may be wise to keep your confidential information as a trade secret, rather than trying to patent it.

Under the advice of competent counsel, the following steps can be taken to protect your valuable trade secrets, namely:

ā€¢ Ensure that all employees and independent contractors sign confidentiality or non-disclosure agreements;
ā€¢ Mark confidential documents with the term “Confidential”, have document retention and destruction policies in place, and regularly train employees on the continuing need to maintain confidentiality; and
ā€¢ Have high level employees sign non-competition agreements, preferably when they join employment, so that they would not compete with your company after leaving employment.