shutterstock_160974335In a recent formal Ethics Opinion, the American Bar Association stressed that lawyers must make reasonable efforts to prevent inadvertent or unauthorized access to confidential information relating to the representation of their clients. The ABA recognized that in the age of constant cybersecurity threats, law firms are targets for hackers for two reasons:

(1) they obtain, store and use highly sensitive information about their clients while at times utilizing safeguards to shield that information that may be inferior to those deployed by the client, and (2) the information in their possession is more likely to be of interest to a hacker and likely less voluminous than that held by the client.

The Opinion further recognizes that while the Model Rules of Professional Conduct do not impose greater or different duties of confidentiality based upon the method by which a lawyer communicates with his or her client, electronic communication involves risks that are constantly changing. Continue Reading ABA Encourages Encryption of Emails When Transmitting Confidential Client Information

shutterstock_421593898Join Seyfarth Shaw’s Trade Secrets Co-Chair Michael D. Wexler and Partner J. Scott Humphrey at the Management Association’s 2017 Employment Law Conference on Thursday, September 28, 2017. Mr. Wexler and Mr. Humphrey will discuss significant developments in Illinois and Congress, such as the Defend Trade Secrets Act, that have changed the landscape of trade secret and restrictive covenant enforcement. Understanding the impact of these changes, and the tools now available to employers for trade secret and restrictive covenant enforcement and protection, will help company’s safeguard its most valuable assets and maintain its advantage over competitors.

Please join us for a fast-paced and informative discussion that clarifies recent developments in restrictive covenant and trade secrets law, and provides “best practices” for protecting some of your company’s most valuable assets—trade secrets, restrictive covenants, and employees.

For more information and registration, click here.

shutterstock_392113519Seyfarth attorney Joshua Salinas will serve on a panel for “Trade Secrets in 2017: Recent Legal Trends and Developments LIVE Webcast,” presented by The Knowledge Group, LLC Live Webcast Series, on May 25, 2017.

Unquestionably, US companies face an increasing threat of cyberattacks from rival companies and foreign governments and the likely targets are trade secrets and other sensitive business information. Since many US companies have overseas operations, the threat of trade secret theft is on the rise which results to billion-dollar intellectual property (IP) theft losses annually.

To address the perceived insufficient legal protection of trade secrets, lawmakers have enacted a series of laws, such as the Economic Espionage Act of 1996 (EEA) and the Defend Trade Secrets Act (DTSA). The US Congress may also support further law and policy efforts aimed at improving trade secret protection. An increase in criminal enforcement efforts is also expected as President Trump indicates the value he gives on IP protection.

In this two-hour LIVE Webcast, a panel of distinguished professionals and thought leaders organized by The Knowledge Group will help businesses and IP counsel understand the recent legal trends and developments in relation to trade secrets. They will provide a comprehensive outlook for the year ahead and will also underscore best practices in protecting trade secrets.

Key topics include:

  • Trade Secret: Current Legal Trends and Developments
  • Trade Secret Theft
  • Trade Secret Protection under the Trump Administration
  • Best Practices to Protect Trade Secrets
  • Legislative Outlook

For more information and registration, click here.

Cross Posted from Carpe Datum Law

Recently, a widespread global ransomware attack has struck hospitals, communication, and other types of companies and government offices around the world, seizing control of affected computers until the victims pay a ransom.  This widespread ransomware campaign has affected various organizations with reports of tens of thousands of infections in as many as 99 countries, including the United States, United Kingdom, Spain, Russia, Taiwan, France, and Japan. The software can run in as many as 27 different languages. The latest version of this ransomware variant, known as WannaCryWCry, or Wanna Decryptor, was discovered the morning of May 12, 2017, by an independent security researcher and has spread rapidly.

The risk posed by this ransomware is that it enumerates any and all of your “user data” files like Word, Excel, PDF, PowerPoint, loose email, pictures, movies, music, and other similar files.. Once it finds those files, it encrypts that data on your computer, making it impossible to recover the underlying user data without providing a decryption key. Also, the ransomeware is persistent, meaning that if you create new files on the computer while it’s infected, those will be discovered by the ransomware and encrypted immediately with an encryption key. To get the decryption key, you must pay a ransom in the form of Bitcoin, which provides the threat actors some minor level of anonymity.  In this case, the attackers are demanding roughly $300 USD. The threat actors are known to choose amounts that they feel the victim would be able to pay in order to increase their “return on investment.”

The ransomware works by exploiting a vulnerability in Microsoft Windows. The working theory right now is that this ransomware was based off of the “EternalBlue” exploit, which was developed by the U.S. National Security Agency and leaked by the Shadowbrokers on April 14, 2017. Despite the fact that this particular vulnerability had been patched since March 2017 by Microsoft, many Windows users had still not installed this security patch, and all Windows versions preceding Windows 10 are subject to infection.

The spread of the malware was stemmed on Saturday, when a “kill switch” was activated by a researcher who registered a previously unregistered domain to which the malware was making requests. However, multiple sources have reported that a new version of the malware had been deployed, with the kill switch removed. At this time, global malware analysts have not observed any evidence to substantiate those claims.

You should remain diligent and do the following:

  • Be aware and have a security-minded approach when using any computer. Never click on unsolicited links or open unsolicited attachments in emails, especially from sources you do not already know or trust.
  • Ensure that your antivirus and anti-malware are up-to-date.
  • Apply Security Updates! Enable automatic updates and reboot weekly. Systems that are receiving automatic updates should already be protected against this malware. If you aren’t sure, visit https://support.microsoft.com/en-us/help/3067639/how-to-get-an-update-through-windows-update.
  • Backup your data! The risk of malware is losing your data. If you perform regular backups, you won’t have to worry about ransomware. Make sure you utilize a backup system that is robust enough to have versioning so that unencrypted versions of your files are available to restore. Make sure your backup system isn’t erasing your unencrypted backups with the encrypted ones!

If your organization is the victim of a ransomware attack, please contact law enforcement immediately.

  1. Contact your FBI Field Office Cyber Task Force immediately to report a ransomware event and request assistance. These professionals work with state and local law enforcement and other federal and international partners to pursue cyber criminals globally and to assist victims of cyber-crime.
  2. Report cyber incidents to the US-CERT and  FBI’s Internet Crime Complaint Center.

MEME_Cal Pecs eBookSeyfarth Shaw LLP has released its 2017 Edition of Cal-Peculiarities: How California Employment Law Is Different. Included within the publication is an overview of how California law is different in the areas of restrictive covenants , trade secrets, and computer fraud. For example, highlights include:

  • But for a narrow exception, new law provides that a California employer cannot in an employment agreement with an employee who primarily resides and works in California require the employee to (1) adjudicate outside of California a claim arising in California, or (2) accept the application of substantive law other than California’s with respect to a controversy arising in California. Cal. Labor Code § 925.
  • Also, although the Defend Trade Secrets Act of 2016 (DTSA) provides for a federal cause of action for trade secret misappropriation that may be pled in California courts, case law interpreting and applying the preemptive scope of California’s Uniform Trade Secrets Act (CUTSA) may impact what state law tort claims can be pleaded in conjunction with a DTSA claim, even where no CUTSA claim is pleaded.
  • Finally, in 2016, the Ninth Circuit published its opinion in United States v. Nosal, 844 F.3d 1024 (2016), where the court held that unequivocal revocation of computer access makes use of a password shared by an authorized system user to circumvent the revocation of a former employee’s access a crime.

Cal-Pecs provides many more useful details in the areas of areas of restrictive covenants, trade secrets, and computer fraud law. Cal-Pecs is available in an eBook to approved requestors.

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shutterstock_543904594In Seyfarth’s second webinar in its series of 2017 Trade Secret Webinars, Seyfarth attorneys Scott Humphrey, Robyn Marsh, and Dawn Mertineit focused on trade secret and client relationship considerations in the banking and financial services industry, with a particular focus on a firm’s relationship with its FINRA members. The webinar included practical steps financial institutions can implement to protect trade secrets and client relationships; tips on what to do if your trade secrets are improperly removed or disclosed or if a former employee is violating his/her restrictive covenant agreements; how to prosecute a case against a former employee who is a FINRA member; and the impact of the Protocol for Broker Recruiting on trade secrets and client relationships.

As a conclusion to this well-received webinar, we compiled a summary of three takeaways that were discussed during the webinar:

  • Remember that you can seek court injunctive relief (Temporary Restraining Order and, possibly, Preliminary Injunction) before proceeding in FINRA.
  • The definition of a trade secret varies but company, but you must take adequate steps to protect them as a company, and the information cannot be publicly available or easily discovered, to merit enforcement under the law.
  • Employers can take steps at all stages to protect their confidential information–don’t forget to implement on-boarding and off-boarding procedures, as well as policies and procedures that will be in effect during an employee’s tenure, to protect your information before a problem arises.

shutterstock_584007385New Location Added – Westside/Silicon Beach!

Trade secret identification and protection is more critical than ever for employers in California. Technology is consuming the way we do business, and new laws concerning trade secrets and the content of employment agreements with California employees makes trade secret identification and protection more critical than ever.

We invite you to join our Seyfarth attorneys Scott Atkinson, Jim McNairy, and Robert Milligan, along with James Vaughn, one of California’s leading computer forensics experts, in an interactive briefing designed to help California employers navigate these tricky waters and provide best practices for trade secret protection.

Topics slated to cover include:

  • How to best identify and protect trade secrets
  • What employers need to know about the DTSA
  • The impact of new California Labor Code Section 925
  • Effective use of restrictive covenants in employment agreements
  • How to catch a trade secret thief
  • Responses to potential trade secret theft
  • Choosing the right court to protect trade secrets
  • Considerations for suing under the DTSA vs California law (or both)

 

May 10, 2017
8:00-10:00 a.m.
Seyfarth Shaw LLP
Los Angeles – Downtown
333 South Hope Street
Suite 3900
Los Angeles, CA 90071
register

 

May 17, 2017
8:00-10:00 a.m
Seyfarth Shaw LLP
San Francisco
JPMorgan Chase Building
560 Mission Street, 20th Floor
San Francisco, CA 94105

register

 

May 24, 2017
8:00-10:00 a.m.

Westside/Silicon Beach
DoubleTree Hotel
6161 West Centinela Avenue
Culver City, CA 90230

register

shutterstock_506478736“I’m from the government and I’m here to help.” Yeah, right.[1]

Most businesses think protecting their intellectual property is their own responsibility, and it is. But what about when your intellectual property rights are violated by an evildoer? Who are you going to call? While your obvious choice will be the law firm sponsoring this blog, you might also be able to get help from your local prosecutor.

Both State Attorneys General and Federal Prosecutors have tools at their disposal that let them bring the full force of the government to your side—when they are motivated to do so. Speaking at a State Fraud & Prevention Summit in Atlanta recently, Georgia Attorney General Chris Carr announced how his office is available to take action on cybersecurity and data breach fraud cases, and he even pointed to several Assistant AGs in the audience who were there and ready to help.[2] Carr said his state’s emphasis on protecting data privacy and security is enhanced by the U.S. Army recently announcing that its new Cyber Command Headquarters (ARCYBER) will be located in Georgia.[3] Other states have similarly dedicated AGs ready to help, and sometimes you can even get local prosecutors to take interest in your case. Continue Reading Enlisting Government Help to Protect Your Trade Secrets

Every day, companies unknowingly give up intellectual property and trade secrets which they could have otherwise protected with simple processes. Poor R&D policies may not capture patent rights on a company invention. A faulty or simply outdated employment agreement may not protect a customer list used by an employee who leaves for a competitor. These pitfalls are easily avoidable by implementing measures on the front end and educating employees on the basics of intangible property and how to protect it.

In this webinar, Seyfarth IP and trade secret attorneys provided a basic overview of what types of intellectual property and trade secrets are protectable, how to protect them, and helpful tips to ensure that a company is doing everything they can to avoid common issues associated with intangible property.

As a conclusion to this well-received webinar, we compiled a summary of three takeaways that were discussed during the webinar:

  • Businesses routinely miss out on opportunities to protect their valuable intellectual property simply because they do not realize that their inventions or developments qualified as intellectual property in the first place. Particularly in light of changes in patent law that reward the first party to file for a patent – regardless of whether they invented something first or not – it is important to be proactive about applying for patent protection as early as possible. If a business believes that an invention may qualify for either a design or utility patent, it should take steps to start the patent application process as soon as possible.
  • Copyright and trademark protection are also an important, and often overlooked, component of intellectual property protection. Trademarks are routinely granted for patterns, brands, logos, trade dress, and other identifying images which businesses may have thought were too generic to qualify for such protection. Copyrights are also becoming an increasingly important tool in protecting computer code.
  • Trade secrets are also intellectual property, but are governed by an entirely different set of laws and are protected in different ways, often through litigation. Because the recently-enacted Defend Trade Secrets Act of 2016 requires the owner of trade secrets to have taken reasonable steps to protect that information, businesses should identify their processes for identifying what information qualifies as a trade secret and what steps they have taken to protect that information, including the implementation of employee confidentiality agreements. Confidentiality agreements drafted before 2016 need to be updated to include certain whistleblower language as a result of the passage of the Defend Trade Secrets Act.

shutterstock_330853187It is well known that 18 U.S.C. § 1836, et seq. (the Defend Trade Secrets Act or “DTSA”) finally provides a mechanism for pursing trade secret claims in federal court. A recent decision, however, serves as an excellent reminder that failure to establish personal jurisdiction over a defendant will nevertheless result in dismissal of your DTSA claim—and potentially your entire case. So, before you rush off and file that DTSA claim in your local federal court, carefully consider if it’s really the right court after all.

In Gold Medal Products Co. v. Bell Flavors and Fragrances, Inc., 1:16-CV-00365, 2017 WL 1365798 (S.D. Ohio Apr. 14, 2017), the plaintiff filed suit in the U.S.D.C. for Southern District of Ohio against its former employee, William Sunderhaus, and his new employer, Bell Flavors, alleging misappropriation of trade secrets and confidential information. As part of its lawsuit, Plaintiff asserted a DTSA claim, which Defendants moved to dismiss for lack of personal jurisdiction. Continue Reading Don’t Forget to Establish Personal Jurisdiction in Defend Trade Secrets Act Cases