Almost 6 Months In, What Have We Learned About the Defend Trade Secrets Act?

Now that almost six months have passed since President Obama signed the Defend Trade Secrets Act (DTSA) into law, let’s take a look at what we’ve learned about the statute thus far.

1. The fuss about ex parte seizures was overblown. Prior to the statute’s enactment, opponents were concerned about misuse of the DTSA’s ex parte seizure remedy. But so far, problems have not materialized. There have not been any reports, at least to my knowledge, of an ex parte seizure being reversed once the defendant had an opportunity to respond. In fact, I’m only aware of one case involving an ex parte seizure order, discussed here, and the judge denied that request.
2. The DTSA can apply to misappropriation that stared pre-enactment. Even though the statute expressly applies solely to actions occurring after enactment, several courts have interpreted the act to cover pre-DTSA misappropriation. But only if the misappropriation continued after the statute’s enactment. I wrote about one such case from the S.D.N.Y. here. The Middle District of Florida reached the same conclusion in Adams Arms, LLC v. Unified Weapon Systems, Inc., Case No. 8:16-cv-1503-T-33AEP.
3. Courts analyze DTSA and state-law trade-secrets claims together. Both types of claims are grounded in similar concepts, so it is hardly surprising that courts analyze the claims together, while applying similar reasoning to the two statutes. For example, in M.C. Dean, Inc. v. City of Miami Beach, Florida, Case No. 16-21731-CIV-ALTONAGA, the Southern District of Florida dismissed claims under both the DTSA and Florida’s Uniform Trade Secret Act, after discussing the two claims together.

So far, there have not been many reported decisions interpreting the act. A Westlaw search for “Defend Trade Secrets Act” yields only 14 results. I will continue to monitor decisions addressing the DTSA and provide regular updates as the statute matures.