Trade Secrets Misappropriation Damages

Trade secrets are information used to operate businesses that are valuable, secret, and afford an actual or potential economic advantage to an enterprise. The theft or misuse of trade secrets often causes significant damage to a company’s profitability. Hampton IP can help you define and set the metes and bounds of misused trade secrets. Then, value the trade secrets and estimate a monetary award for their misappropriation.

Trade secrets are often described as formulas, patterns, a compilation of data, computer programs, devices, methods, techniques, processes, or other embodiments of economically valuable information.

Almost anything can be a trade secret as long as it meets the following three criteria:

• Can be defined
• Provide an economic advantage
• Have economic value
• A reasonable effort was made to maintain secrecy

Trade secrets can be patentable (process, formula) or non-patentable (customer list, pricing).

Trade Secret Law

Trade secret law in the United States has historically been governed by common law. In the mid-1960s the American Bar Association launched an effort to draft a uniform trade secrets act, later known as the Uniform Trade Secrets Act. By 1988, many States had modeled their trade secrets statutes on the Uniform Trade Secrets Act (“UTSA”). In 1996, Congress passed the Economic Espionage Act of 1996 which made it a federal crime to misappropriate trade secrets.

The Defend Trade Secrets Act of 2016 brought trade secret litigation to a Federal cause of action. Trade secret misappropriation awards sometimes resemble trademark and copyright infringement concerning the elements of damages courts award; however, rights associated with trade secrets are markedly different from rights associated with other intellectual property in that a trade-secret owner cannot exclude others from recreating the trade secret through legitimate means.

In most instances, the owner of a trade secret must show that the claimed secret information:

• It is not generally known.
• Confers an economic benefit from its secrecy.
• Underwent consistent, reasonable efforts to maintain the secrecy of confidential information.

We understand and utilize all acceptable damage valuation methodologies used to value trade secrets.

Why Work with Our Expert Consultants?

The professionals at Hampton IP provide persuasive expert witness testimony to help the court and jury understand the true value of trade secrets in your case.

We clearly explain lost profits, incremental costs, the accounting of ill-gotten gains, deductible costs and apportionment when applicable. 

We clarify complex fact patterns and present our findings in precise, clearly written and supported Rule 26 Reports and convincing trial expert witness testimony.

Our representative trade secret cases highlight some engagements in which we have identified, valued and calculated damages for misuse of trade secrets.