Category Archives: President Obama

New Defend Trade Secrets Act Requires Notice in Employee Agreements

pillarsOn Wednesday, President Obama signed into law the Defend Trade Secrets Act of 2016 (DTSA). The DTSA sets a single national standard for trade secret protection and gives the option of bringing trade secret cases in federal court and provides for remedies (such as seizure and recovery of stolen trade secrets).  The DTSA also creates whistleblower protections for employees who disclose trade secrets to an attorney or governmental official for the purpose of reporting or investigating a suspected violation of law.  But most urgently for employers, the DTSA contains a new notice requirement that employers need to take action quickly to satisfy.

Effective immediately, any new or updated agreements with employees, consultants or independent contractors that govern trade secrets or confidential information need to include a “notice-of-immunity.”  The notice may be provided via reference to a general policy document rather than restating the entire immunity provisions in each agreement.  An employer that fails to provide this notice will forfeit their right to exemplary double damages and attorneys’ fees in an action brought under the DTSA.

Employers wishing to take advantage of the DTSA’s protections need to revise their standard agreements and ensure that any agreement provided on or after May 11, 2016 includes the required notice-of-immunity.  We recommend that you consult with legal counsel to ensure compliance with this new requirement.