Business

Confidential Information and Trade Secrets

BUSINESS OBJECTIVES ACHIEVED

Forbes Solicitors' confidential information and trade secrets solicitors provide advice on protecting your business's confidential information and trade secrets. Our team can help you to identify and protect your valuable confidential information, advise on confidentiality agreements and restrictive covenants, and represent you in disputes relating to the misuse of confidential information.

What is Confidential Information

Confidential information is a broad term, and can cover any information that is not generally known or available to the public and is considered sensitive or private. Examples of confidential information include trade secrets, financial information, customer records, intellectual property, and personnel files. The most effective way of protecting confidential information is under contract, such as Non-Disclosure Agreements of Employment Contracts.

What are Trade Secrets

A trade Secret is a particular type of commercially valuable confidential information, such as a formula, pattern, compilation, program, device, method, technique, or process, that provides a business with an economic advantage over competitors or customers. Trade secrets must be kept secret in order to maintain their value.

Confidential information and trade secrets can be amongst some of the most valuable assets a business owns and are often deemed to be as least as important as forms of registered intellectual property, such as trade marks and patents. The scope of trade secrets is virtually unlimited, and can include information such as recipes, designs, customer lists, formulas, patterns, price information or manufacturing methods and processes. Agreements, processes and policies (for example, internal policies governing your employees) are advised to be put in place as early as possible to protect against such information being misused by suppliers, investors, manufacturers, employees, accountants and other third parties who may reasonably come across the same.

In the UK, there are generally two regimes which seek to protect valuable business information.

Confidential information

Almost any information can be protected as confidential information under UK common law, provided it satisfies the three-stage test:

There must be a 'quality of confidence' to the information, meaning that the information must be objectively confidential. This is likely to be satisfied if the holder of the information can show that steps have been taken to maintain its secrecy, for example by marking information as 'private and confidential' or by issuing non-disclosure agreements.

The information must be provided in circumstances giving rise to an obligation of confidence. To be satisfied, the receiver of the information must have known, or ought to have known, that the information was confidential and that they were under a duty to keep it secret. The most effective way to prove this is by a contractual obligation, for example a non-disclosure agreement. Nevertheless, an obligation of confidence can sometimes arise automatically, for example, where confidential information is disclosed by an employer to an employee.

There must be unauthorised use or disclosure (actual or threatened) of the confidential information which has or will cause a detriment to the information owner. The use of the confidential information will be unauthorised where no permission has been provided to use or disclose the information, or if the information was disclosed for a particular purpose and has been used for another unauthorised purpose.

Trade secrets

Alternatively, the Trade Secrets (Enforcement, etc.) Regulations 2018 (the Regulations) govern trade secrets and the Regulations will continue to apply following Brexit. Trade secrets are defined under the Regulations as any information which;

is secret, being not generally known,
has commercial value because it is secret, and
has been subject to reasonable steps to keep it secret.

Under the Regulations, a business will be required to show that it had appropriate measures in place to document and maintain the secrecy of its information, such as a non-disclosure agreement.

Overall

Ultimately, there is significant overlap between the tests for a trade secret under the Regulations and for confidential information under UK common law and valuable business information may be protected under both regimes.

To maintain the secrecy and confidentiality of information, businesses are advised to impose specific and explicit contractual obligations on the intended recipients before the information is disclosed to them. Though such obligations can often be found in employment contracts and supply agreements, specific non-disclosure agreements (also known as confidentially agreements) are useful for clearly outlining the obligations on each party in respect of the confidential information. Non-disclosure agreements are legally binding contracts which set out for what purposes certain confidential information can be shared, to whom such information can be disclosed, for how long such restrictions will last and the arrangements for returning the confidential information once the relationship has ended.

Why choose our solicitors for confidential information and trade secrets?

Our solicitors have extensive experience in handling confidential information and trade secrets cases. We understand the importance of protecting your business's sensitive information and will work tirelessly to ensure that your rights are protected. Our team is dedicated to providing personalised and effective legal solutions that meet your specific needs. With our expertise and commitment to excellence, you can trust us to handle your case with the utmost professionalism and discretion.

Who do our solicitors help with confidential information and trade secrets?

Our solicitors help businesses and individuals protect their confidential information and trade secrets from unauthorised use or disclosure by providing legal advice, drafting non-disclosure agreements, and pursuing legal action against those who breach confidentiality obligations.How can our solicitors help support you with confidential information and trade secrets matters?Our solicitors can help protect confidential information and trade secrets by drafting and reviewing non-disclosure agreements, employment contracts, and confidentiality policies. We can also advise on the appropriate measures to take in the event of a breach of confidentiality, including seeking injunctive relief and pursuing legal action for damages. Our team has extensive experience in this area and can provide tailored advice to ensure your confidential information and trade secrets are protected.

Here at Forbes Solicitors our staff possess extensive expertise in providing legal services and assisting clients in Confidential Information and Trade Secrets cases throughout the nation. Contact us now to converse with our team.

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FAQs

What am I entitled to if a third party discloses confidential information or a trade secret?

There are a range of available remedies where a company's confidential information or trade secrets have been unlawfully used. The court may order for an injunction, preventing a party from using the information in future and also order for compensation and damages, or an account of profits, to be paid to the wronged party.

Can I do anything else, in addition to having non-disclosure agreements in place, to protect valuable information?

Non-disclosure agreements are an important tool in protecting valuable information, however they should not be solely relied upon.

Confidential information may be disclosed in many circumstances, to various different people, and in various formats, for example face-to-face, over the internet, or by email. Businesses should consider the methods used when disclosing information to others and ensure they are as secure as possible, for example by reviewing the systems and applications used to communicate with third parties. Businesses should also be satisfied that physical stores of information, for example cabinets in offices containing paperwork, are suitably locked.

Further, businesses should ensure that disclosure of and access to confidential information and trade secrets is limited to a need to know basis. By restricting the number of people who have access to such information, the risk of misuse is lessened.

In addition to having measures in place to prevent information being misused, businesses should also ensure they have a clear plan which can be actioned swiftly in the event that protected information is lost or unlawfully disclosed or misused.

What is Confidential Information?

What are Trade Secrets?

A trade secret is a particular type of commercially valuable confidential information, such as a formula, pattern, compilation, program, device, method, technique, or process, that provides a business with an economic advantage over competitors or customers. Trade secrets must be kept secret in order to maintain their value.

How can I protect my confidential information?

To protect your confidential information, you should ensure that it is kept secure and only shared with those who have a legitimate need to know. You should consider using non-disclosure agreements (NDAs) to legally bind individuals to keep your information confidential. Under UK law, breach of confidentiality can result in legal action and damages being awarded.

How do I identify and protect my trade secrets?

To identify and protect your trade secrets, you should first identify what information is confidential and valuable to your business. Then, implement measures to keep this information secret, such as limiting access to it and requiring employees to sign non-disclosure agreements. You can also register your trade secrets with the UK Intellectual Property Office. If someone does disclose your trade secrets, you can take legal action under the UK's Trade Secrets (Enforcement, etc.) Regulations 2018.

What are the legal consequences of disclosing confidential information or trade secrets?

Disclosing confidential information or trade secrets can result in legal action being taken against the individual or company responsible. This can include civil lawsuits for breach of contract or breach of confidence, as well as criminal charges for theft or fraud. The consequences can include financial penalties, damages, and even imprisonment in some cases. It is important to protect confidential information and trade secrets to avoid these legal consequences.

Can I sue someone for misusing my confidential information or trade secrets?

Yes, you can sue someone for misusing your confidential information or trade secrets under UK law. The law provides protection for confidential information and trade secrets, and if someone breaches this protection, you can take legal action against them. You may be able to claim damages for any losses you have suffered as a result of the misuse of your confidential information or trade secrets.

How long does a confidentiality agreement last?

The duration of a confidentiality agreement depends on the terms agreed upon by the parties involved. there is no specific time limit for a confidentiality agreement, but it is typically valid for the duration of the business relationship or for a specified period after the agreement ends. It is important to note that some information may be subject to legal requirements for longer periods of time.

Can I enforce a confidentiality agreement against a former employee?

Yes, a confidentiality agreement can be enforced against a former employee . However, the enforceability of the agreement will depend on the specific terms and circumstances of the agreement, as well as the actions of the former employee. If the former employee breaches the confidentiality agreement, the employer may be able to seek legal remedies such as an injunction or damages.