When can whistleblowers disclose trade secrets?

Jan 26 2020      On Behalf of  David M. Duree & Associates, P.C.      Intellectual Property Litigation

Whistleblowers are afforded a number of protections under state and federal law in order to allow them to report alleged wrongdoing without suffering retaliation by their employers. Among these protections is immunity under certain circumstances from civil or criminal liability for disclosing trade secrets.

This immunity is outlined in the Defend Trade Secrets Act (DTSA), which was signed in to law by President Obama in 2016. The DTSA provides remedies to companies and individuals whose trade secrets have been misappropriated.

For the whistleblower immunity to apply, the trade secret disclosure must be made in confidence to a government official, attorney or in a sealed lawsuit “solely for the purpose of reporting or investigating a suspected violation of law.” Further, if a whistleblower acquired access to trade secrets illegally, they aren’t protected from liability.

This doesn’t mean that companies are powerless to prevent trade secret disclosure under the DTSA’s whistleblower immunity provision. While whistleblowers can come from all levels of the company, the more you limit access to your trade secrets and other intellectual property (IP), the lower your chances are that a whistleblower will have access to this information and be able to disclose it.

If you learn that your trade secrets have been disclosed in a whistleblower complaint, it’s essential to find out if the whistleblower had legitimate access to them. If so, did they disclose them as outlined by the DTSA’s immunity provision? If not, be sure to notify the court of the violation.

An attorney experienced with IP can help you work to take action, if warranted, for illegal disclosure of trade secrets. They can also help you protect your trade secrets in the ensuing court cases.

Note, however, that to take action against the employee who inappropriately disclosed the information, you must have notified your employees of the immunity protection provided by the DTSA. Your attorney can also help you ensure that you’re providing proper notification.