Ten Ways Businesses Can Protect Their Trade Secrets

Since the purpose of this blog is to provide information that makes it easier for companies to protect their trade secrets and proprietary information, let’s get started with a list of steps that businesses should take to protect their trade secrets:

  1. Noncompete agreements. Make sure all key employees (or, ideally, all employees who have access to proprietary information) sign noncompete agreements.
  2. Nondisclosure agreements. All employees should sign an agreement that requires them to keep the company’s proprietary information confidential. This can be included in the noncompete agreement. Have employees without a noncompete sign a stand-alone nondisclosure agreement.
  3. Trade-secrets policy. Either as part of an employee handbook or on its own, implement a formal trade-secrets policy. Have each employee acknowledge in writing that they received and reviewed the policy.
  4. Employee training. A formal trade-secrets policy is only effective if employees know about their roles and responsibilities with regard to the company’s trade secrets and confidential information.
  5. Exit Interviews. All companies should be conducting exit interviews with departing employees whenever possible. These interviews should address trade secrets and confidential information, including making sure the departing employee is aware of his or her contractual and other legal obligations. This is also a good opportunity to learn where the employee will be working next, which could alert you to the risk of confidential information being disclosed if the departing employee will be working for a competitor or starting their own company that will compete with yours.
  6. Vendor Agreements. Anytime a vendor has access to confidential information, the agreement with that vendor needs a confidentiality provision.
  7. Restrict access. Make sure that confidential or proprietary information is only accessible to those employees who need this information to carry out their jobs. Access can be restricted through IT systems (e.g., password-protected documents) or more conventional means, such as providing employees with a locking drawer they can use to store printouts of confidential documents.
  8. Computer passwords. Make sure that all employees know to lock their computers whenever leaving their desks. Require all employees to change their passwords periodically.
  9. Reply all. Not only is it brutally annoying to receive unnecessary “reply all” responses, but inadvertent use of “reply all” can circulate proprietary information to unintended recipients. Discourage employees from using “reply all” unless absolutely necessary. Consider using an add-on to your email software that requires employees to confirm before “replying all.”
  10. Data-loss-prevention software. Install software that monitors sensitive information and alerts to possible improper disclosure of this information.

While some of these steps require the assistance of an attorney, others can be taken immediately.

In future posts, I’ll examine these in more depth.

4 responses

  1. Pingback: How to Use Exit Interviews to Protect Proprietary Information | Trade Secrets Law

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