In a competitive marketplace, trade secrets can mean the difference between rising profits and going out of business. Employers who wish to maintain their competitive edge often utilize non-solicitation, non-competition, and non-disclosure agreements to protect their confidential information. These legal contracts aim to preserve the secrecy of company information.
At Starzyk & Associates, P.C., our attorneys have years of experience assisting companies to protect their trade secrets. We concentrate in employment law, keep up to date on recent changes in the legal landscape, and are flexible in crafting legal documents to fit our clients' needs.
Frequently Asked Questions about Trade Secrets & Confidential Information
What is a trade secret?
A trade secret can be any secret formula, pattern, device, or compilation of information used in a company's trade or business that gives the holder of the information a competitive advantage over those who do not know or use it. Examples include business methods, customer information and lists, manufacturing processes and procedures, pricing data, product design, vendor lists, and technical data. To be legally protectable, the trade secret must not be generally known to the public and efforts must be made to maintain secrecy.
Are trade secrets patents?
No. This is a common misconception. Unlike patents, trade secrets do not have to be registered and may be maintained indefinitely as long as the secret is never revealed to the public. However, trade secrets are more difficult to enforce than a patent and protection may be lost if the information becomes known to the public.
How do I protect my trade secrets?
Companies wishing to preserve their confidential information often turn to a number of legal contracts. One important method is a non-disclosure agreement. The aim of a non-disclosure agreement is to create a confidential relationship between two parties and to restrict the disclosure of confidential information or proprietary knowledge under specific circumstances.
Is a non-disclosure agreement the same as a non-competition agreement?
No. Non-competition agreements seek to prevent an employee from competing with his or her employer for a specified time, in a particular place or in a particular way. A non-disclosure agreement prevents disclosure of trade secrets and confidential information acquired by a former employee.
Courts will generally enforce non-competition agreements as long as the duration, geographical area and scope of activity are not overly broad. Non-disclosure agreements are easier to enforce under Texas law because they do not prevent the employee from making use of the general experience he acquired during employment.
What happens if an employee breaches his non-disclosure agreement?
An employer may file a lawsuit against the employee. This lawsuit could enjoin the employee from future disclosures of confidential information. The employer could also seek damages for the breach of the non-disclosure agreement.