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This bill would enable individuals and companies to sue in federal courts to recover damages from the misappropriation or theft of trade secrets, while also ensuring the confidentiality of trade secrets during legal proceedings. A trade secret is a type of intellectual property that, unlike a patent, is concealed from public knowledge to give the owner an economic advantage over its competitors. Under current law, only the Dept. of Justice can file suit in federal court for trade secret misappropriation.

The owner of a misappropriated trade secret would be able to file a lawsuit in a federal district court, and the court would then be able to issue an order to seize any property necessary to preserve evidence in the case. All information gathered or stored by the court would be required to be protected from physical or electronic access while in the court’s custody. Any relevant civil suit filed in federal court must be initiated within three years of when the misappropriation should have reasonably been discovered.

Federal courts would have the following options at their disposal for remedying the case:

Grant an injunction to prevent actual or threatened trade secret misappropriation and take necessary steps to protect the trade secret;
Award damages for either the actual damages caused by the misappropriation, unjust enrichment not covered by the actual damages, or to require reasonable royalties be paid as compensation;
Award exemplary damages of up to two-times the award described above, plus reasonable attorney’s fees if the trade secret was willfully and maliciously misappropriated;
Award reasonable attorney’s fees to the prevailing party if a claim of misappropriation is shown to be made in bad faith based on circumstantial evidence, or a motion to terminate an injunction is made or opposed in bad faith.

Any individual who confidentially discloses a trade secret to a government official or an attorney in the process of reporting suspected misappropriation would be immune from criminal or civil liability. Companies would be required to inform employees about their immunity under the above circumstances in portions of contracts or corporate policy documents that discuss the handling and use of trade secrets.

The Dept. of Commerce and the Patent and Trademark Office would be required to provide relevant congressional committees with a report on the theft of trade secrets belonging to U.S. entities by foreign governments or businesses.

","official_title":"A bill to amend chapter 90 of title 18, United States Code, to provide Federal jurisdiction for the theft of trade secrets, and for other purposes.","short_title":"Defend Trade Secrets Act of 2016","popular_title":null,"short_summary":"(This measure has not been amended since it was reported to the Senate on January 28, 2016. The summary of that version is repeated here.)\n\nDefend Trade Secrets Act of 2016\n\n(Sec. 2) This bill amends the federal criminal code to create a private civil cause of action for trade secret misappropriation.\n\nA trade secret owner may file a civil action in a U.S. district court seeking relief for trade secret misappropriation related to a product or service in interstate or foreign commerce. The bill establishes remedies including injunctive relief, compensatory damages, and attorney's fees. It sets a three-year statute of limitation from the date of discovery of the misappropriation.\n\nA trade secret owner may apply for and a court may grant, in extraordinary circumstances, an ex parte seizure order to prevent dissemination of a trade secret if the court makes specific findings, including that: (1) a temporary restraining order or another form of equitable relief is inadequate, (2) an immediat...","summarized":true,"cost":0,"cost_commentary":"The CBO estimates that implementing this bill would have an insignificant effect on the federal budget.","impact":"Individuals and businesses whose trade secrets have been misappropriated; those who misappropriate trade secrets; federal courts; the Patent and Trademark Office; and the Dept. of Commerce.","argument_for":"Owners of trade secrets that were misappropriated should be able to sue in federal district courts to recover damages, given that trade secret theft is often an issue that crosses state and national borders.","argument_against":"Federal courts don’t need to deal with lawsuits related to trade secret theft. 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If a case needs to go to the federal level it should be allowed to just like any other case would.","argument_against":null,"show_argument_for":true,"show_argument_against":false,"upvote_count":1,"upvotes_for_count":1,"upvotes_against_count":null,"has_upvoted":false,"endorsement_count":1,"links":{"self":"https://www.causes.com/positions/13aacfc8-303d-49bc-849c-4ea303891e05"},"body":"Trade theft, is theft. If a case needs to go to the federal level it should be allowed to just like any other case would.","stance":"yea","created_at":"2016-04-04T19:35:41.419Z","shareable_image_url":"https://n.causes.com/share-images/positions/13aacfc8-303d-49bc-849c-4ea303891e05.png","note_color":null,"note_text":null,"bill_id":"s1890-114","user_id":"jZBb71zZ","endorser_ids":["jZBb71zZ"]}}

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If a Trade Secret is Stolen, Should the Owner be Able to Sue in Federal Court?