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Trading Secrets A Law Blog on Trade Secrets, Non-Competes, and Computer Fraud

Category Archives: Espionage

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Covert Cellular: Enough Protection for Trade Secrets?

Posted in Cybersecurity, Data Theft, Espionage, International, Trade Secrets

With the ever-increasing need to maintain communications with customers and your employees, mobile phones have become a requirement for business people. Spanish telecommunications company Geeksphone is targeting the business market with Blackphone, the first mobile phone that encrypts data transmissions. No one would argue against the value of increased wireless data security, but do CIA-style cellular phones really provide enough …

Global Business 101: Hire Your Competitor as a “Consultant”

Posted in Espionage, Trade Secrets

Why spend millions of dollars employing a bunch of bright, talented employees to develop your business when you can just hire a worker from your rival to steal all their research?  As on every test you took in school, isn’t getting the right answer more important than figuring out how to solve the problem?

Competition for business is fierce.  Small …

Chinese Espionage Latest Target: Liquid Paper

Posted in Espionage, International

Spell check features in word processing programs sent correction fluid the way of the buggy whip. Walter Liew and Robert Maegerle, however, saw a $28 million dollar payout to sell the secrets to, among other things, Liquid Paper. It is doubtful that they can “white out” the bars of their new prison cells, though.

Liew, a California engineering consultant, and …

Top 10 Developments/Headlines in Trade Secret, Computer Fraud, and Non-Compete Law in 2013

Posted in Breach of Fiduciary Duty, Computer Fraud, Computer Fraud and Abuse Act, Cybersecurity, Data Theft, Espionage, International, Legislation, Non-Compete Enforceability, Practice & Procedure, Privacy, Restrictive Covenants, Social Media, Trade Secrets, Unfair Competition

By Robert Milligan and Joshua Salinas

As part of our annual tradition, we are pleased to present our discussion of the top 10 developments/headlines in trade secret, computer fraud, and non-compete law for 2013. Please join us for our complimentary webinar on March 6, 2014, at 10:00 a.m. P.S.T., where we will discuss them in greater detail. As with all

Upcoming Webinar: 2013 National Year in Review — What You Need to Know About the Recent Cases/Developments in Trade Secrets, Non-Compete and Computer Fraud Law

Posted in Computer Fraud, Computer Fraud and Abuse Act, Cybersecurity, Espionage, International, Legislation, Non-Compete Enforceability, Practice & Procedure, Social Media, Trade Secrets

On Thursday, March 6, 2014 at 12:00 p.m. Central, Michael Wexler, Jim McNairy and Josh Salinas will present Seyfarth’s first installment of its 2014 Trade Secrets Webinar series. They will review noteworthy cases and other legal developments from across the nation this past year in the areas of trade secret and data theft, non-compete enforceability, computer fraud, and the interplay …

Upcoming Webinar: The Stakes Just Got Higher – Criminal Prosecution of Trade Secret Misappropriation

Posted in Computer Fraud and Abuse Act, Data Theft, Espionage, Practice & Procedure, Trade Secrets

On Tuesday, December 11, 2013 at 12:00 p.m. Central, Seyfarth attorneys Michael D. Wexler, Molly M. Joyce and Justin K. Beyer will present the twelfth and final installment in our 2013 Trade Secrets webinar series, focusing on criminal liability for trade secret misappropriation.

The topics they will cover include…

Trade secret misappropriation: what it is and how does it happen

Two Former Eli Lilly Scientists Accused of Stealing $55 Million in Trade Secrets on Behalf of Chinese Pharmaceutical Company In Southern District of Indiana Indictment

Posted in Data Theft, Espionage, International, Trade Secrets

In a year in which the United States has brought and prosecuted a series of high-profile criminal cases under the Economic Espionage Act (“EEA”), another one was recently added to the roll call in the Southern District of Indiana, this time against two former high-level scientists with pharmaceutical giant, Eli Lilly. 

On August 14, 2013, a grand jury in the …

AMSC/Sinovel Industrial Espionage Thriller Takes a Procedural Detour, Threatening U.S. Criminal Prosecution

Posted in Cybersecurity, Data Theft, Espionage, International, Trade Secrets

In a story that Hollywood would love to script, the U.S. Government charged Sinovel and its executives with soliciting the then-head of the Automation Engineering Department of AMSC’s Austrian subsidiary, AMSC Windtec GmbH, to steal AMSC’s source code in order that Sinovel might bypass a commercial relationship with AMSC and utilize AMSC’s trade secrets without paying for ongoing software licenses.  …

Nosal Update: Court Denies Motion for Acquittal and New Trial in Marathon CFAA and Trade Secret Misappropriation Criminal Case – Part III

Posted in Computer Fraud and Abuse Act, Cybersecurity, Data Theft, Espionage, Practice & Procedure, Trade Secrets

In Parts I and II of this post, we looked at the Court’s ruling on Nosal’s motion for acquittal and new trial following his conviction of three CFAA counts, two EEA counts and one count of conspiracy. In this final part, we look at what may lie ahead for Nosal and lessons employers may learn from this case.

What’s Next …

Nosal Update: Court Denies Motion for Acquittal and New Trial in Marathon CFAA and Trade Secret Misappropriation Criminal Case – Part II

Posted in Computer Fraud and Abuse Act, Data Theft, Espionage, Restrictive Covenants, Trade Secrets

In Part I of this post, we reviewed the Court’s ruling on Nosal’s conviction on the CFAA counts. Here in Part II, we turn to the Court’s ruling on the EEA counts, and the exclusion of evidence regarding Nosal’s non-compete provision.

B.    Nosal’s Conviction on the EEA Counts:

Nosal was convicted of two counts under the EEA for downloading, copying …

Obama Administration Issues Joint Strategic Plan To Protect America’s Intellectual Property

Posted in Cybersecurity, Data Theft, Espionage, Trade Secrets

The Obama Administration recently issued its 2013 Joint Strategic Plan on Intellectual Property Enforcement, building on the Joint Strategic Plan issued three years ago. In its 88 pages, the 2013 Plan outlines steps for federal agencies to take over the next three years to combat “[IP] infringement that has a significant impact on the economy, the global economic …

Representative Zoe Lofgren Introduces Bill to Create Private Civil Claim for Trade Secrets Theft Under the Economic Espionage Act

Posted in Espionage, Legislation, Trade Secrets

By Robert Milligan and Joshua Salinas

Representative Zoe Lofgren (D- CA) has been very active in the technology and innovation legislation space of late. Last week, Representative Lofgren and Senator Ron Wyden (D-OR) formally introduced companion bills, nicknamed “Aaron’s Law,” in the House and Senate seeking to amend the Computer Fraud and Abuse Act. Almost unnoticed was the fact …

Foreign Engineer Arrested For Trade Secret Theft Involving Medical Technology

Posted in Data Theft, Espionage, Trade Secrets

The U.S. Attorney’s Office in New Jersey recently charged a former employee with stealing trade secrets from a New Jersey medical technology company. 

The former employee, an Indian national, worked in a group at his former employer responsible for the manufacture of pen injectors and pre-fillable syringes.  He resigned from the company last month, and in the weeks leading up

Federal Legislation Proposed To Combat Cyber-Espionage

Posted in Cybersecurity, Data Theft, Espionage, Legislation

Cybersecurity has become a growing concern in the United States.  Legislation impacting this topic covers a variety of fields, including national security and defense, trade and international relations, intellectual property, and even privacy and civil liberties.  As technology is constantly changing, so too are the types of restrictions in place.

A group of prominent American Senators recently introduced the Deter

Seyfarth Attorneys Lead Trade Secrets and Cybersecurity Program

Posted in Computer Fraud and Abuse Act, Data Theft, Espionage, Practice & Procedure, Trade Secrets

California partners Robert Milligan and Jim McNairy will be presenting at a day long Bridgeport Trade Secret and Cybersecurity Program in Los Angeles on May 17th.

Trade secret litigation and employee mobility cases are the hottest areas of intellectual property and employment litigation. More and more senior level executives and employees are leaving one company to start or join a …

New York State Court Rejects Double Jeopardy Argument In Data Theft Case

Posted in Data Theft, Espionage, Trade Secrets

We have previously written about Sergey Aleynikov, a former computer programmer for an investment bank who beat federal charges of trade secret theft under the Economic Espionage Act in 2012.  Although Aleynikov was initially convicted of these charges, the Second Circuit Court of Appeals overturned his conviction, finding that the trade secrets relating to the source code Aleynikov had taken …

Employee Data Theft and Corporate Hacking Studies Point to Need for Additional Federal Trade Secrets Legislation

Posted in Computer Fraud and Abuse Act, Data Theft, Espionage, Legislation, Trade Secrets

By Robert Milligan and Jessica Mendelson

Today is the deadline for public comments requested by the Obama Adminstration on any proposed changes to federal law to combat trade secret theft. 

Some legal commentators have proposed several suggested changes to improve America’s trade secrets laws, including creating a federal civil cause of action for trade secrets misappropriation and clarifying that the …

Obama Administration’s Request for Public Comment on Trade Secrets Law Underscores Importance for Companies to Protect Their Proprietary Assets Now

Posted in Computer Fraud and Abuse Act, Data Theft, Espionage, Legislation, Trade Secrets

Trade secrets and cybersecurity are on the national agenda.

Responsible corporate leaders are closely following the issue and must be concerned about the adequacy of their protections and the fallout should there be a breach.

“There are only two categories of companies affected by trade secret theft: those that know they’ve been compromised and those that don’t know it yet,” …

Obama Administration Calls for Public Comments on Legislative Changes to Enhance Enforcement Against Trade Secret Theft and Economic Espionage

Posted in Computer Fraud and Abuse Act, Data Theft, Espionage, Legislation, Trade Secrets

By Robert Milligan and Joshua Salinas

Last week, the Office of the U.S. Intellectual Property Enforcement Coordinator published a Notice in the Federal Register soliciting public comments for an Administration legislative review related to economic espionage and trade secret theft.

The request specifically seeks written submissions from the public regarding “any recommendations for legislative changes that would enhance enforcement against, …

Federal Court Rules That Government’s Service Attempts Fail In Criminal Trade Secret Matter

Posted in Data Theft, Espionage, Trade Secrets

A federal judge in Virginia recently held that the United States Department of Justice’s attempts to serve Kolon Industries, Inc and five of its executives with criminal summons in a high profile criminal trade secrets action were ineffective, finding, among other things, that service on its U.S. subsidiary was not sufficient.

In the complaint, which was unsealed last October, the …

United States Announces Multifaceted Plan To Combat Trade Secret Theft At Home And Abroad

Posted in Data Theft, Espionage, Legislation, Trade Secrets

By Jessica Mendelson and Robert Milligan

On Wednesday February 20, 2013, the White House released a five-point plan (“the Plan”) intended to combat trade secret theft of American trade secrets. 

The plan is a collaboration between various federal agencies, including the Departments of Commerce, Defense, Homeland Security, Justice, State, Treasury, the Office of the Director of National Intelligence and the …

President Obama Signs Significant Cybersecurity Executive Order

Posted in Data Theft, Espionage, Legislation

By Misty Blair and Ken Wilton

Cybersecurity is at the forefront of the public and private sectors alike, as daily news reports warn of cyberattacks on American institutions such as media, banks, and governmental agencies.

It is in this spirit that, just Tuesday, President Obama signed the long-awaited Executive Order on “Improving Critical Infrastructure Cybersecurity” and devoted …

Aleynikov Case Continues to Grab Headlines in Trade Secrets Community

Posted in Data Theft, Espionage, Trade Secrets

Last year, Sergey Aleynikov, a computer programmer, beat federal charges of trade secret theft under the Economic Espionage Act. Although Aleynikov was initially convicted, the Second Circuit Court of Appeals overturned his conviction, finding that the trade secrets relating to the source code Aleynikov had taken were not related to a product “produced for. . . interstate or foreign …

2012 National Year in Review: What You Need to Know About the Recent Cases/Developments in Trade Secrets, Non-Compete, and Computer Fraud Law

Posted in Computer Fraud, Computer Fraud and Abuse Act, Data Theft, Espionage, Legislation, Non-Compete Enforceability, Practice & Procedure, Restrictive Covenants, Trade Secrets, Unfair Competition

In Seyfarth’s first installment of its 2013 Trade Secrets Webinar series, Seyfarth attorneys Michael Wexler, Robert Milligan, and Joshua Salinas will review noteworthy cases and other legal developments from across the nation this past year in the areas of trade secrets and data theft, non-compete enforceability, computer fraud, and company owned social media accounts and social media policies, as well …