With no known vaccine and high infection rates, countries all over the world continue to take precautions to protect their citizens from Covid-19 by issuing “Stay-at-Home” Orders that prevent residents from leaving their homes except for essential tasks. Homes have transformed from private retreats to offices for one or more working household members, classrooms, and daycares. While some members of the work force have balanced these competing interests for years, for many this is truly a strange new world. With no set end date, companies must implement steps now to ensure the protection of their valuable IP assets, especially their trade secrets. The balance between providing employees access to the resources necessary to do their jobs and the protection of valuable trade secrets, however, is delicate.
A trade secret is only valuable for so long as it remains a secret. Companies that choose trade secret law to protect their valuable information carefully weigh the costs of maintaining the secret, and the overall economic benefit to the company, against considerations such as whether it can be easily reverse-engineered. How can these companies ensure their trade secrets remain secret and avoid accidental disclosure in an environment where most meetings are conducted virtually using video conferencing technology and where multiple people may be working in the same home office space?
The jury’s $700 million verdict in Motorola Sols., Inc. v. Hytera Commc’ns Corp., Ltd. (see our prior blog post), and the ongoing high profile trade secret cases concerning Huawei, suggest that trade secret protection is more important than ever before. Lex Machina recently reported that trade secret filings increased 30% between 2015 and 2017 and remained steady since 2017. The increase during this period is attributed to the creation of a federal claim for trade secret misappropriation in the DTSA. In 2019, 72% of all trade secret filings had DTSA claims. See Lex Machina Trade Secret Litigation Report, pg. 3. While trade secret protection may not be the immediate concern of a company facing massive business disruptions due to the current pandemic, it should be. Absent reasonable steps now, to protect and maintain the secrecy of the company’s trade secrets could mean there may no longer be a business to return to after COVID-19.
Companies should not only proactively protect their workers by following local “Stay-at-Home” Orders, they should proactively protect their valuable trade secrets by instituting the following seven steps:
- As “Stay-at-Home” Orders and their less restrictive variants are extended and employees possibly grow weary of their new working situations, remind employees of their agreement to follow all company confidentiality policies, non-disclosure rules and security protocols outlined in their employment contracts. Requiring refresher training for employees and reminding them of these policies is also a good idea. If these policies do not exist, implement them now and provide the related training.
- Require employees to acknowledge receipt of and certify their understanding of the company’s confidentiality and non-disclosure policies. Affirmatively remind all employees of their agreement to not use information gained exclusively while at the company in conducting any work outside of the company. Conversely, remind employees not to use what another person or entity might consider her/his/its confidential information in doing work for your company.
- Remind all employees that any viewing or discussion of highly sensitive documents or information should be in private and out of earshot of others, including family.
- Eliminate employee use of personal devices or accounts to access or create copies of the company’s most sensitive information.
- Require employees to utilize only “company approved” conferencing technology, especially video conferencing technology, and require that additional security settings be in place when using it. Additionally, remind employees to check their surroundings when participating in any audio or video conference to protect against inadvertent disclosure.
- Review current access rights to the company’s confidential information and remove those who no longer need access. Consider installing key logging or access logging software that keeps a record of who accesses sensitive information and when. For any employee who currently needs access to the confidential information, employ a strict approval process and require periodic check-ins to determine if access is still necessary.
- Require employees to access confidential documents only through company created VPN portals and do not allow local saves of confidential documents or information.
Requiring strict adherence to all company confidentiality policies and enforcing good trade secret hygiene will not only help protect your company’s trade secrets during this time of an extremely diffuse workforce, but will help ensure protection after the pandemic is over.