Should businesses have stronger trade secret protections? (HR3326)

Summary for Congressional bill HR 3326 (114th):

  • Trade secrets are secret items that give a business a leg up against their competition (for example, Coca-Cola’s secret formula).
  • This bill creates a national legal standard for businesses to bring private civil action against those who steal trade secrets from them.
  • Currently, there are only state laws protecting trade secrets in civil trials.
  • Currently, only criminal action can be taken through federal courts.

In Depth:

  • This bill also gives the power of a “pre-notice ex parte”, which allows businesses to seize the alleged trade secret before bringing them to court.
  • The UTSA (Uniform Trade Secrets Act) has been adopted by 48 states, which provides for trade secret protection in civil courts.
  • However, the UTSA is slightly different across all states, leading to some confusion.
  • Increases the statute of limitations to 5 years (UTSA gives 3 years).
  • The difference between civil and criminal courts is that only the government can bring up a case in criminal court.
  • Trade secrets are the only form of IP in the US without federal civil actions available.

Vote Yet if you believe:

  • Businesses should have strong trade secret protections. #TradeSecrets #IP
  • Increasingly, foreign nations are stealing trade secrets from US companies. #Cybersecurity #TradeSecrets
  • Federal law creates uniformity throughout the country. #FederalVsState

Vote No if you believe:

  • State laws (UTSA) are already effective and sufficient. #FederalVsState
  • The “pre-notice ex parte” is ripe for abuse. #ExParte
  • The federal courts have enough cases to deal with. #FederalCourts link to HR 3326

(This is the 1st draft of the summary for a bill in Polinav. Summary & In-Depth is non-partisan & Vote yes/no reasons are fact-checked. if you think something is wrong, should be added or deleted, comment below!)

This one is fairly nonsensical to an average Joe, but it’s still important in some regards. One of the main points is to allow for a private, civil action in a federal court. There are state, civil actions available through the UTSA, but laws are a bit different throughout the country, so different procedural items and other legal jargon have to be understood for whichever state you’re dealing in. With it being at the federal level, everyone is on one system then.

That one isn’t particularly controversial, but more about whether we want the laws to be adjudicated at the state or federal level. The biggest point of contention has to do with the “pre-notice ex parte”. There are some important distinctions with this legal procedure.

Mainly, the business doesn’t have to get a court date for this. The whole point of getting a court date is to inform the opposing party that you’re taking some action & what action you’re taking. With an ex parte, you inform the opposing party the day before (so they can bring counsel if they’d like), you bring your case and supporting arguments and request the action to the judge right away. The judge then has the authority to allow the action or not.

It’s an interesting case to use this. If someone has stolen your trade secrets, because they’re trade secrets, there’s a certainty immediacy to it. Once it’s public – well – it’s not a secret anymore. So, allowing for this action does seem like a necessity for this use case. However, the fact is that the reason why this isn’t allowed is that we generally want the rule (and procedure) of law to exist. This could very easily be misused by malicious parties.

This one is hard to judge, but this one, I stand on the capitalist side; we should help businesses keep their intellectual property protected against improper methods of extracting trade secrets.

I want my representatives to vote YES on this bill!



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