For many entrepreneurs, know-how, proprietary expertise, and trade secrets are of vital importance.
For many entrepreneurs, know-how, proprietary expertise, and trade secrets are of vital importance.
For many entrepreneurs, know-how, proprietary expertise, and trade secrets are of vital importance. However, protecting this valuable information is not always easy. While patent law offers protection, it requires publication of the invention, which is not always desirable. Moreover, not all trade secrets are suitable for protection as intellectual property. This is where the Trade Secrets Protection Act (‘Wbb’) offers a solution, especially procedurally.
The Trade Secrets Act defines trade secrets as information that (1) is confidential and not generally known or easily accessible, (2) has commercial value because of its secrecy, and (3) is subject to reasonable measures to ensure its confidentiality. This may include technical or commercial information, provided it generates financial benefits or offers a competitive advantage. Examples include confidentiality clauses in contracts, encrypted data storage, and other measures taken to safeguard sensitive information.
The law states that any acquisition, use, or disclosure of trade secrets without permission is unlawful. This does not only apply to the deliberate copying of documents, but also to unauthorized access to or appropriation of materials containing the trade secrets.
An NDA (Non-Disclosure Agreement) is one of the most effective measures to protect trade secrets. Through an NDA, you commit the recipient of confidential information to keep it strictly confidential and not to use or share it without permission. Drafting a thorough NDA not only helps clarify what is considered confidential information, but also strengthens your legal position should a dispute arise. A well-worded NDA can make all the difference when proving wrongful conduct and obtaining damages.
If your trade secrets have been obtained illegally, you can take legal action. The court can prohibit the use or sale of products made using the trade secrets. You can also seek damages from the infringer. The damages are usually based on the amount that would have been due if the infringer had requested permission to use the trade secret. Section 8 of the Trade Secrets Protection Act also allows for additional damages if the infringer knew or should have known that he was acting unlawfully.
One of the biggest challenges in enforcing rights to trade secrets is that you often need to disclose those secrets in legal proceedings to prove infringement. The Dutch Trade Secrets Act offers protection in this regard through Article 1019ib of the Dutch Code of Civil Procedure. This provision allows the court to ensure that trade secrets remain confidential and accessible only to specific parties, such as lawyers and a limited number of authorized individuals. In certain cases, the court may even decide that a party to the proceedings is not granted access to specific documents if such disclosure would seriously harm the protection of the trade secrets, as provided for under Article 22a of the Code of Civil Procedure.
These provisions help safeguard the confidentiality of trade secrets, but they also raise important questions. It can be challenging for a lawyer to withhold information from their own client, and it may lead to concerns about the right to a fair trial.
The Trade Secrets Act provides clear guidelines on what constitutes a trade secret and when infringement occurs. However, it remains crucial to take proactive measures to protect trade secrets, such as using non-disclosure agreements (NDAs) and implementing technical security measures. These precautions help prevent competitors from misappropriating your valuable know-how.
If you have a question about protecting your trade secrets and know how, please contact Guldemond Advocaten.
