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- /* BBS LEGAL GUIDE COMMENTARY: The text of the 1985 Amended
- Uniform Trade Secrets Act follows, with comments. Please bear in
- mind that this is the UNIFORM TEXT, and that each state has made
- changes to the uniform text. This text is quite important for
- employer/employee relations since it defines protection of trade
- secrets in the absence of contract terms and provides the sole
- source of criminal penalties for unlawful breach of trade
- secrets. */
-
- SECTION 1
-
- As used in this [Act], unless the context requires otherwise:
-
- (1) "Improper means" includes theft, bribery,
- misrepresentation, breach or inducement of a breach of a duty to
- maintain secrecy, or espionage through electronic or other means;
-
- /* The list of "improper means" is not all-inclusive. */
-
- (2) "Misappropriation" means:
-
- (i) acquisition of a trade secret of another by a
- person who knows or has reason to know that the trade secret was
- acquired by improper means; or
-
- (ii) disclosure or use of a trade secret of another
- without express or implied consent by a person who
-
- (A) used improper means to acquire knowledge of
- the trade secret; or
-
- (B) at the time of disclosure or use, knew or had
- reason to know that his knowledge of the trade secret was
-
- (I) derived from or through a person who had
- utilized improper means to acquire it;
-
- (II) acquired under circumstances giving rise
- to a duty to maintain its secrecy or limit its use; or
-
- (III) derived from or through a person who owed
- a duty to the person seeking relief to maintain its secrecy or
- limit its use; or
-
- (C) before a material change of his [or her]
- position, knew or had reason to know that it was a trade secret
- and that knowledge of it had been acquired by accident or
- mistake.
-
- (3) "Person" means a natural person, corporation, business
- trust, estate, trust, partnership, association, joint venture,
- government, government subdivision or agency, or any other legal
- or commercial entity.
-
- /* Note that the government is supposed to keep trade secrets
- secret. However, don't take this too seriously since in many
- states you won't be able to sue to enforce your supposed right.
- There are many hazards when dealing with the government as a
- customer for software or computer services, including "freedom of
- information" acts that may make a contract supposedly keeping
- your code secret a nullity and useless. */
-
- (4)"Trade secret" means information, including a formula,
- pattern, compilation, program, device, method, technique or
- process, that:
-
- (i) derives independent economic value, actual or
- potential, from not being generally known to, and not being
- readily ascertainable by proper means by, other persons, who can
- obtain economic value from its disclosure or use, and
-
- (ii) is the subject of efforts that are reasonable under the
- circumstances to maintain its secrecy.
-
- /* Trade secrets under this definition include confidential
- information not based on inventions or engineering such as
- customer or prospect lists, or other customer information. */
-
-
- SECTION 2. INJUNCTIVE RELIEF
-
- (a) Actual or threatened misappropriation may be enjoined.
- Upon application to the court, an injunction shall be terminated
- when the trade secret has ceased to exist, but the injunction may
- be continued for an additional reasonable period of time in order
- to eliminate commercial advantage that otherwise would be derived
- from the misappropriation.
-
- (b) In exceptional circumstances, an injunction may
- condition future use upon payment of a reasonable royalty for no
- longer than the period of time for which use could have been
- prohibited. Exceptional circumstances include, but ar are not
- limited to, a material and prejudicial change of position prior
- to acquiring knowledge or reason to know of misappropriation that
- renders a prohibitive injunction inequitable.
-
- (c) In appropriate circumstances, affirmative acts to
- protect a trade secret may be compelled by court order
-
- 3. DAMAGES
-
- (a) Except to the extent that a material and prejudicial
- charge of position prior to acquiring knowledge or reason to know
- of misappropriation renders a monetary recovery inequitable, a
- complainant is entitled to recover damages for misappropriate.
- Damages can include both the actual loss caused by
- misappropriation and the unjust enrichment caused by actual loss.
- In lieu of damages measured by any other methods, the damages
- caused by misappropriation may be measured by imposition of
- liability for a reasonable royalty for a misappropriator's
- unauthorized disclosure or use of a trade secret.
-
- (b) if willful and malicious misappropriation exists, the
- court may award exemplary damages in an amount not exceeding
- twice any award made under subsection (a).
-
- 4. ATTORNEY'S FEES
-
- If (i) a claim of misappropriation is made in bad faith,
- (ii) a motion to terminate an injunction is made or resisted in
- bad faith, or (iii) willful and malicious misappropriation
- exists, the court may award reasonable attorney's fees to the
- prevailing party.
-
- 5. PRESERVATION OF SECRECY
-
- In an action under this [act], a court shall preserve the secrecy
- of an alleged trade secret by reasonable means, which may include
- granting protective orders in connection with discovery
- proceedings, holding in-camera hearings, sealing the records of
- the action, and ordering any person involved in the litigation
- not to disclose an alleged trade secret without prior court
- approval.
-
- 6. STATUTE OF LIMITATIONS.
-
- An action for misappropriation must be brought within three years
- after the misappropriation is discovered or by the exercise of
- reasonable diligence should have been discovered. For the
- purposes of this section, a continuing misappropriation
- constitutes a single claim.
-
- 7. EFFECT ON OTHER LAW.
-
- (a) Except as provided in subsection (b), this [act] displaces
- conflicting tort, restitutionary, and other law of this state
- providing civil remedies for misappropriation of a trade secret.
-
- (b) this act does not affect:
-
- (1) contractual remedies, whether or not based upon
- misappropriation of a trade secret;
-
- (2) other civil remedies that are not based upon
- misappropriation of a trade secret; or
-
- (3) criminal remedies, whether or not based upon
- misappropriation of a trade secret.
-
-
- 8. UNIFORMITY OF APPLICATION AND CONSTRUCTION.
-
- This act shall be applied and construed to effectuate its
- general purpose to make uniform the law with respect to the
- subject of this act among states enacting it.
-
-
- 9.SHORT TITLE.
-
- This act may be cited as the Uniform Trade Secrets Act.
-
-
- 10. SEVERABILITY.
-
- If any provisions of this act or its application to any
- person or circumstance is held invalid, the invalidity does not
- affect other provisions or applications of the act which can be
- given without the invalid provision or application, and to this
- end the provisions of this act are severable.
-
-
- 11. TIME OF TAKING EFFECT.
-
- This act takes effect on __________, and does not apply to
- misappropriation occurring prior to the effective date. With
- respect to continuing misappropriation that began prior to the
- effective date, the act also does not apply to the continuing
- misappropriation that occurs after the effective date.
-
-
- 12. REPEAL.
-
- The following acts and parts of acts are repealed
-
- (1)
- (2)
- (3)
-
-
- LIST OF STATES ADOPTING:
-
- ALABAMA
- ALASKA
- ARIZONA
- ARKANSAS
- CALIFORNIA
- COLORADO
- CONNECTICUT
- DELAWARE
- DISTRICT OF COLUMBIA
- FLORIDA
- HAWAII
- IDAHO
- ILLINOIS
- INDIANA
- IOWA
- KANSAS
- KENTUCKY
- LOUISIANA
- MAINE
- MARYLAND
- MINNESOTA
- MISSISSIPPI
- MONTANA
- NEBRASKA
- NEVADA
- NEW HAMPSHIRE
- NEW MEXICO
- NORTH DAKOTA
- OKLAHOMA
- OREGON
- RHODE ISLAND
- SOUTH DAKOTA
- UTAH
- VIRGINIA
- WASHINGTON
- WEST VIRGINIA
- WISCONSIN
-