The following is a non-exhaustive checklist of steps that a business might take to protect information it considers to be a trade secret. While these steps will provide a good overview, it is highly recommended that any business consult with an attorney familiar with litigating trade secret matters to develop a robust plan to protect trade secrets that will work for your business.
These steps are not intended as being all-encompassing. In some circumstances they will be insufficient, and in other instances, they may be overkill. These steps are offered as guidance, and there are additional steps a business may consider taking to protect its trade secrets. However, it is hoped that this list will help businesses start a discussion on the topic and implement steps to protect trade secret information that is reasonable for their business and situation.
Determine What Is a Trade Secret
□ Identify the trade secret information
□ Specifically
□ By category
□ Identify where the trade secret information is located
□ Determine who has access to the trade secret information
□ Is the information only accessible internally?
□ Is the information accessible by third parties?
□ How is the information used in the business?
□ Create a document that specifically identifies the trade secrets, where the trade secrets are located and who has access to the trade secrets
Procedures and Policies — Internal
□ Restrict access to the trade secret information
□ Undertake periodic audits to monitor and evaluate compliance
□ Mark and stamp documents containing trade secret information as “confidential”
□ Educate employees on what information is considered to be a trade secret
□ Devise document handling procedures for documents that contain trade secret information
□ Restrict access to documents containing trade secret information – give them need-to-know access
□ Devise sign-in/sign-out procedures to access documents that contain trade secret information
□ Documents containing trade secret information cannot leave the premises or certain areas of the premises
□ Provide periodic updates about the policies and the fact that compliance is monitored
□ Keep documents containing trade secret information separate from other business documents.
□ Train employees regarding document handling procedures for documents containing trade secret information
□ Implement procedures regarding removal of documents containing trade secret information from the premises
□ Reproduce only a limited number of documents that contain trade secret and confidential information
□ Enter into separate non-disclosure agreements with key employees and employees that have access to trade secret information
□ Ensure that the information that is considered to be a trade secret is separately identified as trade secret information.
□ Implement a procedure for tracking and destroying documents that contain trade secret information
□ Have a company-wide confidentiality policy and require all employees to acknowledge and sign the policy
□ Make sure the employee handbook provides that there is no expectation of privacy for employees
□ Use work for hire/development agreements with employees and independent contractors
□ Have a document retention policy
□ Have an email policy
□ Provide updates about the policies to all employees
□ Make all computers, laptops, tablets and smartphones company-owned
□ Obtain copyrights to protect important written materials and software
□ Obtain patents to protect inventions, business processes and software
□ Monitor compliance with procedures and policies and communicate concerning efforts to monitor compliance
Policies and Procedures – Departing Employees
□ Disable accounts and network access privileges of terminated and departing employees
□ Examine and/or copy employee’s laptop and other devices before departure
□ Conduct exit interviews of all employees
□ Obtain information about new employer
□ Obtain information about new position and responsibilities
□ Remind departing employee of need to inform new employer of non-disclosure agreement and obligations
□ Remind employee of obligations of confidentiality
□ Provide employee with copy of non-disclosure agreement
□ Obtain return of company documents and other company property
□ Have employee acknowledge in writing confidentiality obligations and return of company documents and property
□ Document the exit interview
Physical Security Measures
□ Require employee identification badges or cards where appropriate
□ Install visitor control systems – visitor badges – where appropriate
□ Keep drawers or areas containing confidential information separated and locked
□ Implement policies addressing the use of company information on employee personal devices
□ Implement computer security measures
□ Password protections for different levels of access
□ Require periodic password changes
□ Require multi-character passwords
□ Database/file restrictions
□ Secure laptops
□ Code trade secret data
□ Monitor use of portable storage devices
□ Remove external ports from computers
□ Control access to Internet
□ Forensic examination of departed employee’s computer
□ Copy hard drive of departed employee
□ Install computer surveillance measures/monitor computer use
□ Encrypt trade secret information
□ Appropriate virus and malware protections.
□ Ensure all discarded computer equipment is erased before disposal
□ Shred documents containing trade secret information
□ Establish physical barriers to prevent unauthorized viewing of trade secret processes
□ Post “no-trespassing” and/or “restricted area” signs
□ Institute overall plan physical security precautions
□ Fences
□ Limit number of entrances and exits
□ Use alarms
□ Use self-locking doors
□ Use after-hours security
□ Use secured dumpster
Procedures and Policies – External
□ Devise policy for providing trade secret information provided to third parties
□ Require third parties to sign non-disclosure agreements as a condition of gaining access to trade secret information
□ Ensure that the information that is considered to be a trade secret is separately identified as trade secret information.
□ Use confidentiality/non-disclosure provisions in contracts with third parties
□ Devise a policy for tracking trade secret information provided to third parties.
□ Periodically audit measures third party has in place to protect trade secret information.