Protecting trade secrets may require going to court

Glenn W. Peterson

Keeping proprietary information within the company can present a challenge to Sacramento business owners. Every time an employee leaves, whether voluntarily or otherwise, steps need to be taken in order to make sure that no trade secrets leave with him or her. If an employer discovers that someone did leave the company with one or more trade secrets, it may be necessary to take steps to retrieve the information and protect it. Phillips 66 had to do just that when it turned in to the FBI a former employee who ultimately admitted to taking at least one trade secret upon his resignation.

The 35-year-old man worked with a team to develop a next generation battery. In Dec. 2018, he left the company with a thumb drive upon which he had copied several proprietary research and development files. He later returned it, claiming he “forgot” to leave it when he left the company. Upon its inspection, some files were deleted from it. Those files turned up on a hard drive in the possession of the man, who was a permanent resident of the country at the time.

The former employee recently pleaded guilty to theft. More than likely, those at Phillips 66 hope that he did not have time to transmit the information to anyone before the drive was seized. Any business owner here in Sacramento who has trade secrets can understand that fear. Companies live and die by their confidential processes, and losing one could cost even small companies significant amounts of money.

Protecting trade secrets can feel like a full time job for many companies, regardless of their size. Putting policies and procedures in place to help ensure that no information leaves the company with former, or even current, employees could help. However, the system needs to balance the needs of the company with the rights of the employee. Consulting with an intellectual property attorney could be a wise first step.