Massachusetts Court Confirms That When It Comes To Trade Secrets, Confidentiality Is Key

A recent case in Massachusetts confirms that taking affirmative steps to protect the confidentiality of trade secrets is absolutely critical to litigating a claim for misappropriation. In C.R.T.R. v. Lao, Plymouth Superior Court Docket No. 2011-962 (Dec. 30, 2013), the plaintiff sued a former independent contractor for, among other things, misappropriation of the company’s trade secrets. The defendant moved for summary judgment on the grounds that the information allegedly misappropriated was not a trade secret, and that even if the information were a trade secret, the company had not taken adequate steps to protect the information. The court agreed with the company that there was a genuine dispute of fact over whether the information allegedly taken by the defendant constituted a trade secret, in light of the company’s identification of several trade secrets — including prices paid by the company and its customers, amounts sold and purchased, billing procedures, customer lists, business processes and work flow patterns, and processes for obtaining customers, among other things. The court also determined that the company had put forth sufficient evidence to suggest that the information provided the company with a competitive advantage, and that it was not generally known to those outside the business, both hallmarks of a trade secret.

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