FORT LAUDERDALE BUSINESS LITIGATION: POTENTIAL SECURITY MEASURES TO PROTECT YOUR TRADE SECRETS

Establishing the existence of a trade secret requires the plaintiff to prove it owns information that derives independent economic value from not being generally known to other persons, is not readily ascertainable by proper means by other persons, and is the subject of reasonable efforts under the circumstances to maintain the trade secret’s secrecy. Fla. Stat. § 688.002 (defining trade secret). This article focuses on the last element – the requirement that a trade secret plaintiff undertake reasonable measures under the circumstances to protect his or her trade secret. The Fort Lauderdale business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

Trade secret statutes like Florida’s Uniform Trade Secret Act and the Federal Defend Trade Secret Act do not typically define what constitutes reasonable measures of protection under the circumstances. ClearOne Commc’ns, Inc. v. Bowers, 643 F.3d 735 (10th Cir. 2011). Notwithstanding, measures may qualify as reasonable under the circumstances even if they are imperfect or ultimately fail to thwart misappropriation. The owner of a trade secret is not required to employ every possible measure to preserve secrecy of the trade secret. Life Spine, Inc. v. Aegis Spine, Inc., 8 F.4th 531 (7th Cir. 2021). Indeed, courts have recognized that many trade secrets would lose their economic value if the confidential measures employed to protect them limited use to a few persons within a company because it would prevent the businesses from using the information in a manner that could effectively generate economic value. WWMAP, LLC v. Birth Your Way Midwifery, 711 F. Supp. 3d 1313 (N.D. Fla. 2024). Therefore, a trade secret plaintiff can establish the existence of his or her trade secret absent proof it kept the trade secret “under lock and key only for the viewing eyes of company officials with the highest security clearance.” Tax Track Sys. Corp. v. New Inv. World, Inc., 478 F.3d 783 (7th Cir. 2007).

The reasonableness of a trade secret plaintiff’s efforts to maintain secrecy will depend on the particular circumstances of each case. Adler v. Loyd, 496 F. Supp. 3d 269 (D.D.C. 2020). Potential secrecy measures can include the following:

• access control policies or measures like passwords, thumbprints, or iris scans that protect computers, documents, and files containing the secrets;

• a safe or locked compartment storing secrets items;

• alarm systems;

• cameras and surveillance systems;

• non-disclosure or confidentiality agreements;

• written and verbal warnings to those who have access to the secrets;

• paper shredders;

• compartmentalization of information the restricts trade secret access to those who “need to know;”

• photocopier restrictions and digital file data transfer restrictions;

• cyber security measures like encryption; and

• security guards.

WWMAP, LLC, 711 F. Supp. 3d 1313. These suggested measures are not exhaustive. Different measures could be used and may offer greater protections depending on the facts and circumstances surrounding the trade secret at issue. In addition, there is no guarantee implementation of some or all of the suggested measures above will adequately protect the trade secret or demonstrate a trade secret plaintiff took reasonable measures under the circumstances to protect his or her trade secret. Court will generally look to different factors when analyzing the reasonableness of the protections employed such as the nature of the trade secret, the economic value of the trade secret relative to the costs of employing various security measures, the probability of misappropriation, the magnitude of the harm that would result from misappropriation, the size of the business and the number of its employees, and the extent of the business’s need to disseminate the secret to exploit its economic value. WWMAP, LLC, 711 F. Supp. 3d 1313. Trade secret owners should keep these factors in mind when considering what trade secret protections to employ and how many protections to use.

The Fort Lauderdale business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.