While companies are becoming more adept at securing data, cybersecurity remains a monumental challenge. Given the vastness of the internet, the ever-increasing practice of employing remote-based workers, the ease with which secure information can be transferred to a USB flash drive, and the unmonitored use of mobile devices, corporate espionage is on the rise.

Corporate paralegals will find themselves researching trade secret legislation and following related case law, thereby ensuring supervising attorneys are properly informed.

The Uniform Law Commission's Uniform Trade Secrets Act (UTSA) — approved in 1979 and subsequently revised in 1985 — defines a trade secret as "consisting of confidential, commercially valuable information." Jurisdiction issues can complicate the adjudication process when litigating trade secret cases. Each state has its own trade secret statutes and case law. States have also adopted varying versions of the UTSA language.

The formula for Coca-Cola and the recipe for Kentucky Fried Chicken are famous examples of trade secrets protected under state law.

Inconsistent language further complicates trade secret legislation. For example, the UTSA defines misappropriation as "disclosure or use of a trade secret of another without express or implied consent." The Computer Fraud and Abuse Act (CFAA) enacted in 1984 provides it is a crime to "intentionally access a computer without authorization or exceed authorized access, and thereby obtain information."

The CFAA is "not intended to prohibit the subsequent use or misuse of information." The statute does not expressly prohibit the misappropriation of information. Thus, if one's intent is to steal company secrets but the individual has authorization to access the files, the individual is not in violation of the CFAA.

In Tank Connection, LLC v. Haight, the Court found the authorized use of shared files does not violate the provisions of the CFAA. To further complicate how trade secret cases may be litigated, it is important to mention that the Connecticut Appellate Court and the Virginia Supreme Court ruled in complete opposition to one another.

However, the reasoning appears to be reinterpreted in United States v. Nosal (heard by the United States Court of Appeals for the 9th Circuit) where the dissent claims the 9th Circuit "improperly expanded the CFAA beyond ... to apply ... mere password sharing." At issue here is whether sharing one's company password is consistent with disclosing a company trade secret.

Corporate paralegals will want to devote special attention to the nature of the data that has been accessed, whether such access has been "authorized" and how the data is subsequently used when researching misappropriation of trade secrets.

The Economic Espionage Act of 1996 (EEA) defines trade secrets as "all forms and types of financial, business ... technical, economic ... information, whether tangible or intangible if (1) reasonable measures have been taken to keep such information secret and (2) the information derives economic value, actual or potential, from not being generally known ... by the public."

Thus, under the EEA, theft of trade secrets constitutes corporate espionage. Title I of the EEA was enacted to protect proprietary information by providing for both criminal and civil penalties for the theft of trade secrets. Proprietary information is defined as data of valid economic interest. Of note, the EEA does not protect American companies in cases where the offender is a foreign national and the "act" wholly occurs in a foreign country.

Congress passed an evolutionary piece of trade secret legislation this May. The Defend Trade Secrets Act of 2016 (DTSA) amends the EEA, which previously was limited to criminal cases. Trade secrets are now subject to both federal civil and criminal causes of action.

The DTSA as codified at 18 U.S.C. § 1836(b)(1) reads: "An owner of a trade secret that is misappropriated may bring a civil action if the trade secret is related to a product or service used in, or intended for use in, interstate or foreign commerce." Companies can also now apply for ex parte seizure orders to prevent dissemination of their purported stolen trade secrets in "extraordinary circumstances."

Proponents of the DTSA believe the Act provides uniformity. The definition of a trade secret under the DTSA is information "not known by other persons who can obtain economic value from its disclosure." The statute of limitations to bring an action within three years is consistent with the UTSA. However, the DTSA does not take precedence over state trade secret laws.

Further, the DTSA and state statutes may define trade secrets and misappropriation differently. There can be different remedies. In addition, plaintiffs now have a choice of state court, federal court, or both as a venue for where one's case can be filed. This leads to the question of whether this additional level of legislation (DTSA) will complicate and increase the expense of litigation.

One of the first cases to be filed under the DTSA was M.C. Dean, Inc. v. City of Miami Beach, Florida, where the plaintiff alleged trade secret misappropriation under both the DTSA and the Florida Uniform Trade Secrets Act (FUTSA). As of Aug. 8, Federal District Court held the plaintiff "did not take reasonable steps to protect the information as a trade secret."

As of this writing, the plaintiff has been granted leave to amend the complaint. This case should be tracked by paralegals to learn how federal and state statutes align (DTSA and FUTSA).

A second case to follow pursuant to the new DTSA, which involves multiple jurisdictions, is Universal Protection Service, LP, A California Limited Partnership v. Mark Thornburg, Mike Weatherl, and AGTAC Services, LLC, A Nebraska Limited Liability Company (UPS LP) filed in the U.S. District Court for the Northern District of Texas.

The plaintiff is seeking injunctive relief and damages for alleged misappropriation of trade secrets under the Texas Uniform Trade Secrets Act and in violation of the DTSA. A memorandum opinion transferring the case to the U.S. District Court in Nebraska indicates a duplicate case being handled there. The parties may have reached a settlement, based on the Nebraska court's order denying the transfer from Texas.

Both UPS LP and Dean will certainly set the stage for determining the effectiveness of the DTSA and whether it meets the expectations of uniformity expressed by its proponents.

According to the National Federal of Paralegal Associations' Model Code of Ethics and Professional Responsibility, paralegals have a duty to "participate in continuing education to keep informed of current legal, technical and general developments." Further, Guideline 10 of the ABA Model Guidelines for the Utilization of Paralegal Services states, "A lawyer who employs a paralegal should facilitate the paralegal's participation in appropriate continuing education."

Webinars and online roundtable discussions are frequently offered by reputable law firms or other legal entities. These opportunities may offer up-to-date summaries of current legislation or case law as well as the introduction of new technology or research tips on how to track trade secret legislation.

In summary, a paralegal's value is principally demonstrated by continuing education and awareness. Excellent research skills and being informed are both important assets of a competent paralegal.

Two noteworthy pieces of legislation currently in the news for corporate paralegals to follow are Brexit's potential impact on trade secrets and the U.S. Supreme Court's recent amendments to the Federal Rules of Criminal Procedure, which are anticipated to become law on Dec. 1. Resources are readily available to keep paralegals informed, such as joining intellectual property groups on LinkedIn, subscribing to research databases such as Westlaw or Lexis Advance, and scanning legal blogs on the Internet.