Robert Milligan, Seyfarth partner and co-chair of the firm’s Trade Secrets, Computer Fraud & Non-Competes group, and associate Alex Meier recently attended the Sedona Conference on Trade Secrets (Working Group 12) in Denver, Colorado. Working Group 12 seeks to aid judges and practitioners in developing consensus-based guidelines for managing trade secret litigation and protecting trade secrets.
The presentations and commentary at the conference included:
- Leveraging Internal Assets in the Governance and Management of Trade Secrets—moderated by Robert Milligan
- The Proper Identification of Asserted Trade Secrets in Misappropriation Cases
- Equitable Remedies in Trade Secret Litigation
- Extraterritorial Reach of Trade Secrets Case law Synergies
- Cross-Border Discovery Issues in Trade Secret Litigation
- Inevitable Tension: Reconciling Public Court Access with Protecting Trade Secrets in Litigation
- Monetary Remedies in Trade Secret Litigation
- Judicial Roundtable
Part of the focus of the conference was on the two publications that are out for public commentary until October 31, 2022:
- The Sedona Conference Commentary on Monetary Remedies in Trade Secret Litigation, Public Comment Version
- The Sedona Conference Commentary on the Governance and Management of Trade Secrets, Public Comment Version
As part of the Leveraging Internal Assets in the Governance and Management of Trade Secrets presentation, the discussion centered on how some companies are increasingly looking to leverage the value of their trade secrets and how investing in an organized framework for a Trade Secret Management Program is fundamentally about risk mitigation and protection, but may also be about creating and extracting value from the trade secrets.
The panel discussed how a Trade Secret Management Program should be customized for a company’s business reality and involve all key stakeholders. Organizations necessarily rely on their employees to actually implement a Trade Secret Protection Program and to exercise appropriate care and judgment in connection with their use or disclosure of trade secrets. Employers reasonably expect that their employees will maintain the confidentiality of the company’s information (including information entrusted to the company by third parties) and that they will avoid either inadvertently or intentionally disclosing or using that information for any purpose outside the parameters of their employer’s business.
As part of a Trade Secret Management Plan, the panel discussed how employers should tailor their policies and procedures to guard against the risk of unlawful use or disclosure of their trade secrets, while avoiding inappropriately restricting their former employees’ application of their general knowledge, skill, and experience in their next employment. As part of the dialogue, the panel discussed how identification of what the company considers trade secret and employee education and engagement are essential parts of an effective Trade Secret Protection Program.
The conference provided a great forum to brainstorm and learn about how parties, lawyers, and judges are addressing novel or complex issues relating to trade secret litigation or management. Some of our major takeaways from the conference were:
- Ex parte seizure orders are still extremely uncommon—The Defend Trade Secrets Act of 2016 include a process to obtain an ex parte seizure order. The standard to get an ex parte seizure order, however, is so high that few practitioners reported that they had even sought an ex parte seizure order under the DTSA.
- Continued focus on trade secret identification—Every trade secret lawsuit begs the question of what intellectual property claims the plaintiff asserts―that is, what is each asserted trade secret? Numerous conference participants reported that a major sticking point for defendants remained getting plaintiffs to identify trade secrets with a sufficient degree of specificity. The level of specificity required varies by jurisdiction and many seasoned attorneys disagreed on the level of particularity required. Failing to make a sufficient disclosure can backfire, however at summary judgment or trial if the plaintiff simply points to a pile of allegedly misappropriated information and leaves it as an exercise for the judge or jury.
- Equitable relief should fit the case—Equitable relief, or its denial, must always be tied to the direct and circumstantial evidence presented to the court and the reasonable inferences therefrom and not rely simply on oft-cited mantras or invocations of presumptions
- Experience matters—During the judicial roundtable, members of the panel emphasized that trade secrets litigation is technical and complex, and parties put themselves at a significant disadvantage when litigating these cases with someone who lacks trade secret specific expertise.
If you or your organization is interested in learning more about The Sedona Conference’s Working Group 12, please visit The Sedona Conference’s website or contact us to learn more about Seyfarth’s involvement in Working Group 12.