Erika Birg and David Monachino Published in Executive Counsel

In the article "Tribal Memory Can Lead To A Trade Secret Violation" in the Janaury / February 2008 issue of Executive Counsel magazine co-authored by Erika and David, the authors point out that departing employees often are under the misimpression that as long as they have no written contractual prohibitions and do not take any physical materials from their previous employer, they are free to use any knowledge, including trade secrets, that they gained from their previous employment without repercussion. But recent case law, notably a Connecticut state case known as General Reinsurance Corp. v. Arch Capital Group, has held that an employee’s use of the prior employer’s information, even if it’s remembered and not transferred in some tangible form, written or electronic, may be actionable. The definition of trade secret applicable in most states is derived from The Uniform Trade Secrets Act, and it encompasses a variety of information, including a formula, process or “compilation.” That could include customer lists, but it does not include generally known skills. The only way to protect those is a non-compete agreement. One critical element of a trade secret, the authors points out, is that it’s been subject to a reasonable effort to maintain secrecy. Without that element firmly established, the expense and effort of establishing a “taking-by-memorization” will be for naught.