TRADE SECRET INFORMATION
Trade secret laws attempt to strike a balance between protection of your secrets as intellectual assets of your company and your employees' ability to change jobs. Companies have used trade secret laws to protect information used to produce well known products for many years. The formula for Coca-Cola has been held as a trade secret since its introduction. By holding the formula for Coca-Cola as a trade secret, Coke has avoided the public disclosure that would have accompanied patent protection. Trade secret protection is not suitable for all products but should be considered along with the other forms of intellectual property protection within the context of your particular objectives, see Combining Patent, Copyright, and Trade Secret Protection.
Trade secret protection of valuable business information originated in state common law. An attempt to make trade secret law more uniform across the states has resulted in the Uniform Trade Secret Act (UTSA) which has been adopted by a majority of the states. In Washington State, Chapter 19.108 RCW regulates trade secrets.
A trade secret is defined in RCW 19.108.010(4): "'Trade secret' means information, including a formula, a pattern, compilation, program, device, method, technique, or process that: derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and is the subject of efforts that are reasonable under the circumstances to maintain its secrecy."
At the federal level, the Economic Espionage Act of 1996 (EEA) criminalizes stealing trade secrets and provides for jail time and fines. The EEA prohibits the theft of trade secrets, as well as the "knowing possession" or use of a misappropriated trade secret, which it broadly defines as "business, financial, scientific, technical or economic information in any form." The law covers a broad range of information, ranging from client contact lists and distribution strategies to computer program code. Corporations violating the act can be fined up to $10 million and its officers may face criminal prosecution.