Free Enterprise - The FindLaw Small Business Law Blog

How Can a Startup Protect Trade Secrets?

You're starting a business because you've got some great, new ideas. So how do you protect those ideas once you're in business?

From intellectual property laws to non-disclosure agreements, there are quite a few legal options for protecting trade secrets. Here's how to know which is the right option for a particular product or idea, and which are right for your startup.

How to Protect Your Company Secrets

Not everything unique to your startup falls under patent, trademark, or copyright laws. Unique pricing schemes, organization structures, and even recipes may be beyond traditional IP laws, so you may need to rely on non-disclosure and non-compete agreements for your employees, contractors, and possibly service providers as well.

What to Do if Employees Are Stealing Your Data

It may be hard to fathom that someone you started your business with is stealing your ideas. And once you've wrapped your head around the concept, it may be even harder to prove. It may not sound very trusting, but you need to start with a clear and comprehensive policy regarding company secrets, along with information technology systems that aid in detecting data theft. It doesn't hurt to gently remind your employees that theft of trade secrets can be a crime.

What to Do if an Ex-Employee is Using Your Trade Secrets

Once an employee is out the door and let's your company secrets out of the bag, so to speak, what options do you have? First, there are state and federal statutes -- including the Economic Espionage Act -- that criminalize the theft of trade secrets. You may also be able to obtain a civil injunction barring the ex-employee from further work or disclosure that would expose trade secrets. In some cases, the person's new employer could be liable as well.

For a more comprehensive view of protecting your startup's trade secrets, inventions, or ideas, contact a local intellectual property attorney.

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