Protecting Trade Secrets in the Era of the Data Breach -

The prevalence of data breaches cannot be ignored. New data breaches continue to occur one after an-other. In the first half of 2015 alone there were reports of large scale data breaches involving multiple companies in the healthcare industry, the United States Office of Personnel Management (OPM), the IRS, a telecommunications provider, an online console gaming provider, and a transportation company. Organizations face a monumental task of safeguarding confidential data, as the concept of a safe perimeter around private networks continues to erode and adversaries become ever more sophisticated. While efforts and failures to secure data have received a large amount of press, most of it has been focused on breaches relating to information about people—whether financial or medical. This is primarily because most of the laws that relate to liability for data breaches in the U.S. deal with identifiable information relating to individuals. In addition, the thought of peoples’ private information being stolen or disclosed invokes a strong emotional reaction from the public that a breach of other business data does not.

Nevertheless, companies should be equally concerned about the breach of non-personal business data, such as their trade secrets, and establish proper safeguards to mitigate the attendant risks. The Uniform Trade Secret Act identifies a trade secret as follows...