Manufacturing & Distribution Client Alert - April 2017

TRADE SECRET PROTECTION UPDATE

When it comes to maintaining their competitive edge, most companies rely, to a greater or lesser extent, on safeguarding technological and other proprietary methods, processes and information against disclosure to, and use by, their competitors. While patenting of new inventions is one way of doing this, it is generally a lengthy and expensive process that may be less useful than simpler tools that serve the same purpose. Copyright protection can be an effective means for protecting certain intellectual property assets (computer programming and software, for example), but for any business that relies for its success on maintaining a technology lead over its competitors, protection of proprietary methods, processes and information as trade secrets may prove more useful in the long run.

In addition to protection through common sense measures (physical security, computer security, etc.) to prevent unauthorized access to trade secret and confidential information, most companies focused on the issue also impose restrictions on use and disclosure of such information through confidentiality agreements with employees, nondisclosure agreements with vendors and suppliers and the like. Rights and remedies for protection of trade secrets have also been available for decades under state trade secrets laws (most modeled on the Uniform Trade Secrets Act promulgated as a model for such laws nearly 40 years ago).

With enactment of the Defend Trade Secrets Act of 2016 (DTSA) in May of last year, those whose trade secrets have been stolen or misappropriated were afforded an additional path to seek redress under federal law. This new statute expanded on preexisting federal law allowing imposition of criminal penalties for trade secret theft or misappropriation, to now include a private right to pursue civil rights and remedies in federal court. Some rights under the DTSA overlap those also available under state laws, but some of its provisions create new avenues of attack against violators of private trade secret rights. For example, the DTSA creates the potential for seizure of property to prevent illegal dissemination of trade secrets under extraordinary circumstances, which could be useful, for example, in cases where recovery of an electronic device is critical to protection of company trade secrets contained on it.

While the majority of legal actions brought for enforcement of trade secret rights are still being brought under state trade secret laws, the number of legal actions based in whole or in part on DTSA claims since enactment of this federal law is substantial. As an additional tool for enforcement of trade secret legal rights and particularly because legal actions under it will be in federal rather than state courts it is to be expected that the DTSA will continue to increase in usage and importance going forward.

For further information, contact Bob Smartschan at (757) 624.3221 or resmartschan@kaufcan.com.


NEW OSHA/VOSH POSTER, ANTI-RETALIATION AND INJURY REPORTING RULES

In response to a change mandated by its federal counterpart, OSHA, the Virginia Department of Labor and Industry, Division of Occupational Safety and Health (VOSH) promulgated a new administrative regulation regarding reporting of injuries and enhanced anti-retaliation procedures. Highlights of the new regulation include:

  • Employers are encouraged to post a new OSHA poster. The new poster may be accessed on the Federal OSHA website, but keep in mind, to be compliant with applicable law either the previous poster or the most recent poster must be at least 8.5 by 14 inches. The new poster highlights the recent amendments to OSHA regs regarding employee protection from retaliation for reporting an unsafe working condition or injury.
  • Manufacturers and distributors may wish to take a close look at policies which require alcohol and/or drug testing after all workplace accidents and incidents. OSHA has indicated that a blanket requirement without a sufficient nexus between the employee to be tested and the accident or incident is retaliatory.
  • Under the new regulation, many manufacturing and distribution employers will be required to submit injury and illness reports electronically. This requirement will be phased in over a period of two years. Also, some of the data reported to OSHA in employer reports will be publicly posted on OSHAs website.
  • OSHA/VOSH previously would only respond to retaliation if alleged in a formal complaint by an employee. Effective January 1, 2017, retaliation may also be cited -- just as other safety and health violations -- when uncovered during a routine inspection or even from an employee complaint regarding an unrelated matter.

For further information, contact Bob Barry at (757) 624.3268 or rjbarry@kaufcan.com.


The contents of this publication are intended for general information only and should not be construed as legal advice or a legal opinion on specific facts and circumstances. Copyright 2017.

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