Nobody’s Business But Your Own: Famous Trade Secret Leaks to Learn From

Companies have the right to protect and zealously defend intellectual property. Most forms of intellectual property are straightforward, but trade secrets aren’t like other types of intellectual property, and businesses must take extra measures to preserve their rights.

Companies use a form of D.I.Y method when it comes to trade secrets; the information remains unregistered to preserve confidentiality. Companies can go to great lengths to protect trade secrets because the protection afforded to them lasts only as long as the information remains protected. Once the secret is out, all bets are off.

Trade secrets can be violated intentionally or by mistake. Several well-known trade secret leaks have occurred throughout the years, and there are lessons you can learn from each:
CBS vs. Russell Hantz
CBS filed a lawsuit in 2011 against publisher Jim Ealy after he made contact with a former “Survivor” contestant who willingly leaked spoilers about the show. Once Ealy was named in a lawsuit, he promptly spilled the beans about his source, and CBS refrained from pursuing the case. The lesson to be gleaned from this little episode is that people talk, and it’s hard to keep secrets about anything when winners and losers are involved. A 5-million-dollar disclosure clause didn’t deter Hantz from talking. It’s still unclear if the leak was real or calculated as a publicity stunt, as Hantz was discovered actively participating in publicizing the show some time later.
Panasonic & the Angelababy Fiasco
Hong Kong fashion model and Panasonic Ambassador Angelababy accidentally leaked photos of the company’s brand new camera by positing pictures on Instagram. When the model realized she made a mistake, she deleted the pictures. However, the damage was done. Now the model has lost her position as ambassador, and she’s in hot water with a lawsuit filed against her claiming she has affected Panasonic’s market and future releases with her major faux pas. Accidents happen, but sometimes they can be avoided if all parties are clear about projected timelines. Chances are Angelababy did not violate Panasonic’s secrets intentionally. Nevertheless, she made an expensive mistake that could cost her a career.
Goldman Sachs Employee Leaks Apple & Intel Trade Secrets
Absolute power corrupts absolutely, and financial reasons appear to be reason enough to motivate professionals to leak trade secrets. Such was the case in early 2012 when a Goldman Sachs employee was caught on wiretap leaking secrets about both Apple and Intel. It isn’t clear what information was leaked, but the information was used to enhance the stock portfolios of the parties involved in receiving the content of those secrets. This particular employee is currently facing insider trading charges. What is the key takeaway here? No one is immune, and you never know who might be waiting in the wings to exploit top secret information. 
Protecting Trade Secrets
Curators of trade secrets have the right to defend their secrets. In some cases, the secrets must be defended in a court of law:

  • Employees bound to not disclose trade secrets by virtue of their position.
  • People who discover trade secrets through dishonesty or deception.
  • People who accidentally discover trade secrets but who have reason to know the information is protected.
  • People who violate signed disclosure agreements.

There is only one type of violation that cannot generally be prosecuted: individuals who discover trade secrets through the process of reverse engineering are protected from prosecution.

Every US state has laws that prohibit the theft and/or dissemination of trade secrets. These laws are protective measures prescribed by the content of the Uniform Trade Secrets Act. Trade secret owners can enforce their rights against thieves and spies by asking a court to intervene and issue an injunction to prevent information from being disclosed. Trade secret owners can also sue for damages for economic injuries suffered due to theft and dissemination of trade secrets.

It’s important to know that procuring and disseminating trade secrets can be a crime. Persons who violate trade secret laws can be prosecuted under state and federal charges.

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