Competitive intelligence is a business function that many large companies utilize for the purpose of gathering and analyzing useful information about competitors in an ethical manner. Two Seyfarth Shaw LLP trade secret lawyers recently had an article published about this important business function and some of the trade secret issues involved.

Michael Wexler and Robert Milligan’s article, "Keep On the Right Side of the Line: A Trade Secret Law Perspective," was published in the September-December 2009 issue of Competitive Intelligence Magazine, which is a publication of the Society of Competitive Intelligence Professionals (“SCIP”), The article discusses the pitfalls a company encounters when it does not do enough to protect its key information. The authors also address some best practices for competitive intelligence (CI) professionals to gather useful information in an ethical manner while simultaneously protecting their own companies from disclosing sensitive information. They note that

Companies must continuously and aggressively seek new and effective ways to protect their proprietary and trade secret information. If a trade secret is leaked, its value to the company may be severely compromised and lost forever. Likewise, to avoid the often detrimental and serious repercussions that accompany improper intelligence gathering, companies must be extremely vigilant to ensure that they use only ethical means to acquire information about their competitors.

According to Michael and Robert, "A CI professional should gather intelligence by examining published information sources, conducting interviews, and using other ethical information gathering methods." They also point out that companies’ needs for creative trade secret protections has increased due to advances in technology and telecommunications. The authors conclude, "Competitive intelligence is an important aid to a company in the marketplace if it is gathered properly. However, if the information is gathered improperly, the information ceases to constitute competitive intelligence at all, and can result in detrimental and serious consequences for the CI professionals involved and their company."