The inevitable disclosure doctrine in trade secrets cases is a simple concept. At its core, it presumes a former employee will inevitably disclose and use trade secrets of the former employer in the employee’s role with the new employer. As a result, it further presumes, it is inevitable that the former employee will disclose and use the trade secret information already in the employee’s head in a substantially similar new role.
Several federal courts have approved using the federal Defend Trade Secrets Act (DTSA) to grant injunctions to former employers to prevent threatened disclosure of trade secrets. When so doing, federal courts focus on the former employee’s new role to determine whether the employee is likely to misappropriate information–mere possession of trade secrets is insufficient. In states including Illinois, New York, and Pennsylvania, federal courts permit use of the DTSA to enjoin former employees because such use is consistent with the state’s adoption of the inevitable disclosure doctrine. But in other states, including California, the DTSA does not support claims asserting the inevitable disclosure doctrine.
Two 2022 decisions refusing to use the inevitable disclosure doctrine will have a major impact on how the DTSA will be applied in the future. These cases were decided in federal courts in Oregon and Maine, which further shows the breadth of the split across the country. We foresee the U.S. Supreme Court ruling on this issue in the next couple of years.
Regardless of the outcome, you need to remain vigilant when protecting your trade secrets. There is no excuse for not keeping them confidential and limiting access to them.
We remain ready to help you resolve any trade secret issues you may have.
David Seidman is the principal and founder of Seidman Law Group, LLC. He serves as outside general counsel for companies, which requires him to consider a diverse range of corporate, dispute resolution and avoidance, contract drafting and negotiation, real estate, and other issues. He can be reached at firstname.lastname@example.org or 312-399-7390.
This blog post is not legal advice. Please consult an experienced attorney to assist with your legal issues.