Congress Passes Legislation to Protect Trade Secrets

U.S. lawmakers recently passed legislation strengthening legal protection for companies’ trade secrets, including manufacturing processes.

The House voted 410-2 to approve the “Defend Trade Secrets Act.” The Senate unanimously passed the measure earlier in April.

The legislation, which President Obama is expected to sign soon, would open the door for companies to sue in federal court for damages related to theft of trade secrets.

House Judiciary Committee Chairman Bob Goodlatte said the measure “will help American innovators protect their intellectual property from criminal theft by foreign agents and those engaging in economic espionage.”

Theft of intellectual property, including trade secrets, is estimated to cost American firms more than $300 billion a year, according to a 2013 report by the Commission on the Theft of American Intellectual Property.

Trade secret theft already is a federal crime, but without the right to sue in federal court, companies must seek redress in state courts amid a patchwork of state laws.

In allowing civil suits in federal court for illegal procurement of trade secrets, including manufacturing processes, formulas, computer algorithms, industrial designs, business strategies and customer lists, the legislation aims to create uniform standards for what constitutes trade secret theft.

Source: Reuters S