Trade Secret

What Is a Trade Secret? A trade secret is any confidential business information that derives independent economic value from not being generally known to competitors and is the subject of reasonable efforts to maintain its secrecy. Unlike patents, trademarks, and copyrights, trade secrets are not registered with any government agency. Protection depends on the owner taking active steps to keep the information confidential. ## Examples of Trade Secrets - Manufacturing processes and formulas - Customer lists and pricing strategies - Software algorithms and source code - Business strategies and marketing plans - Supplier information and cost structures - Research data and test results ## Legal Protection Trade secrets are protected under the federal Defend Trade Secrets Act (DTSA) and the Uniform Trade Secrets Act (UTSA), adopted by most states. To qualify for protection, the information must have independent economic value because it is secret, and the owner must take reasonable measures to maintain secrecy, such as non-disclosure agreements, access restrictions, and employee training. Misappropriation, whether through theft, breach of confidence, or improper means, can result in injunctive relief, actual damages, unjust enrichment, and in some cases, exemplary damages and attorneys' fees.