Expert: Kacey Cahill - 1/21/2009

Question
What steps can we take, besides a patent, to protect our proprietary information (product technology, guides, etc.). We recently discovered a client had shared our information with a competitor. We've concluded that getting, enforcing, litigating a patent is not cost-effective for our small business. Can we use confidentiality agreements or have some kind of proprietary clause in our contract? Thank you.

Answer
Elisa, ABSOLUTELY!  If you have information that gives you an edge over your competition, you need to protect it with trade secret and confidentiality language in your contracts, but also IP language that says, hey this is ours and not yours and irrespective of whether this is a trade secret, you agree not to use it for any reason except our benefit.  You need to have everyone sign this that gains access to your proprietary information.  
The trick with trade secret is in order to sue for a violation of trade secrets, you must first show the information is trade secret --that you took all reasonable measures to keep it confidential (that means everyone signs the above described agreements).
Also, get people to sign non-competes when they are hired or you do a deal with them (need consideration).

Elisa, I do these contracts for a living, and more language is better than less in this case.  If you hire somebody to draft it, make sure they are good and they listen to what you need.  In this case, experience is key.

I hope this helps, but please keep in mind that this information is being provided for educational purposes and is not intended as legal advice.  Should you need further assistance, please feel free to contact me through my website -- www.kaceylaw.com.

Kind regards,

Kacey Cahill
kcahill@kaceylaw.com