B LAW 341

BUSINESS
LAW I
SECTION 005
INTRODUCTION TO
Employment
CONTRACTS, and
Innovation
LIABILITY ISSUES &
Protection
INTELLECTUAL
TOPIC OUTLINE
I. Employment Discrimination (continued)
A. Sexual Harassment
B. Americans with Disabilities Act
II. Health and Safety Protection
A. Fair Labor Standards Act
B. Family Medical Leave Act
III.Trade Secrets
A. Qualifying Information
B. Misappropriation

2017 Daniel R. Cahoy

INTELLECTUAL PROPERTY PRINCIPLES
Information is a public good
But will be underproduced if not partially privatized
Free rider
Property rights provide exclusivity
Creates incentive to produce information
Intangible property rights
Right to exclude, but not necessarily use
Not tied to an object
Alienable
National scope
Differences from country to country
Generally need to secure this right in every country
Go to international countries, only right in Canada but not US
It depends on the nature of the right
How you get them differs

2017 Daniel R. Cahoy

INTELLECTUA INTELLECTUA
L PROPERTY L PROPERTY
GIVES YOU GIVES
AN OTHERS
INCENTIVE INCENTIVE
TO CREATE TO
OR INVEST DISTRIBUTE

2017 Daniel R. Cahoy

 Right Standard Term Examples Reg?
New, Yes, US
Mousetrap;
Utility Nonobvious, Patent &
20 years from filing software; formula,
Patent Useful Trademark
delivery system
Invention Office
KFCs original
Valuable,
Trade No limit, as long as recipe; Apples new
Secret No
Secret still secret products; Customer
Information lists
UPSs use of Optional, US
No limit, as long as
Source brown; Coke logo; Patent &
Trademark still in use and not
Indicator phrase Penn Trademark
abandoned
State Office
Image,
Depends on State -
Right of voice, Joe Paternos
Up to 100 years No
Publicity representati image
after death
on
Life of author + 70
years, or Books; music; Optional, U.S.
Original
Copyright 95 years from movies; paintings; Copyright
Expression publication, 120 from
sculptures Office
creation
Yes, US
Ornamental
Design 14 years from Shoe designs; Patent &
Object of
Patent issuance auto wheel shape; Trademark
Mfg.
Office
T.S. SUBJECT MATTER
Any information held as a trade secret
Formulas, compilations, programs, etc.

Cokes formula is one of the oldest trade secret

How do you run the M restaurant
Operation secret

Takes values from being secret

If you say what it is, it destroys the secret
Once people can figure, it disappear

2017 Daniel R. Cahoy

 FUNCTIONAL INFORMATION: TRADE
SECRET THEFT
Trade Secret Protection
Prevent or penalize misappropriation (theft) of qualifying secret information
Any information
Not commonly known or ascertainable
Must be maintained as a secret
Disclosure destroys secret
Has value from being kept secret
Prominent state law
Uniform Trade Secrets Act
Most states use It
New Federal law
Defend Trade Secrets Act of 2016
New federal trade protection
Applies across across the country, a uniform TS law across the country
Federal criminal protection since 1996
Economic Espionage Act
Federal criminal laws, can only used by the government, u cant sue it
No filing procedure
Perpetual (if kept secret)
2017 Daniel R. Cahoy
AMA V. MARTIN
Al Minor & Assoc. is an actuarial firm
Approximately 500 clients
Developed by Al Minor since 1983
Martin worked as actuary from 1998-2002
In 2003, Martin formed his own company
Solicited 15 clients
AMA sued for T.S. misappropriation
Secret client list
Court
Law does not distinguish between tangible and intangible form
Client list meets definition of T.S.
Martin Misappropriated Secrets

He didn'tt take any documents that is marked

He didntt sign the confidentiality or non-competing agreements
He knew it was secret but took the intangible infor. Meet the definition
of TS.
Even if you only know it in your head.
2017 Daniel R. Cahoy
 FUNCTIONAL INFORMATION: TRADE
SECRET THEFT
Misappropriation
You improperly acquired
Stolen or other espionage
Bribery or misrepresentation
Disclosure or use of anothers trade secret that
You promised to keep secret
You received from someone
Who misappropriated it
OR who acquired it under a duty to keep it secret
AND you knew of the impropriety
Damages and/or injunction

Tough issues
What is misappropriation?
When is agreement necessary
Secrecy agreements is not necessary for employees. It is assumed that
employees understand that sth is secret when made sure. Necessary
agreements for people outside of the firm
Employee mobility
2017 Daniel R. Cahoy
A STORY OF COKE SECRETS
In 2011, This American Life claimed to have original recipe for Coke
Published in a 79 newspaper article
Appeared in a photo
NOT a recreation
Confirmed by historian
Read recipe on air
Trade secret theft?
Secret and misappropriation?
Is it likely that this was not reverse engineered?
Coke can still have secrets on new products
Take as the criminal cases by the federal government
If they knew the information is misappropriated, the pepsi would be liable.

Did IRA glass commit trade secrete misappropriation?

He read the it at a old newspaper article
It was destroyed as a secret in 1979 when it was published on newspaper
Pepsi has reverse-engineering the coke and get the formulae and is not
considered appropriation.
reverse-engineering is never appropriation

2017 Daniel R. Cahoy

FUNCTIONAL INFORMATION: TS THEFT
Mis
Has to have wrongful behaviors
Cant accidentally steal it

2017 Daniel R. Cahoy