So many of the most notable businesses and brands in the world were all started with one, unique idea that was developed masterfully into a global name. From Kentucky Fried Chicken to Coca-Cola to the ever-popular Google, all of these companies, and more, desperately need to keep their ideas under wraps to stay ahead of competitors and profitable. If you run a business in Texas, odds are you have the same concern of wandering eyes sullying your company’s health. But what can you do to shut the metaphorical blinds on those who would like to steal or “borrow” your ideas?
Texas trade secret law is a useful tool for locking up your secrets legally and keeping them that way, but only if you know how to use it and what is actually protected.
Under Texas trade secret law, any privately created information or business idea that gives your company a competitive advantage can be considered a trade secret, such as:
- Clientele lists
- Business strategies
- Formulas and algorithms
- Inventions not yet patented
The law will most likely apply to any such secret so long as it is only known by employees and other parties directly involved in the day-to-day workings of the business. Trade secrets are also expected to have some sort of intrinsic value or benefit in order to gain legal protections. That is to say, if a trade secret is stolen but there is no real financial or reputational impact of the leaked information, there might also not be a clear legal violation.
Protecting Your Trade Secrets
How does one lock up a secret? Some companies choose to be arguably eccentric and actually use massive vaults to conceal a few pieces of paper with sensitive information. While this certainly makes a statement, it is not necessary.
In most situations, you only need to use a nondisclosure agreement in all formal and pertinent business contracts. You will definitely need to make such nondisclosure agreements known whenever a new employee signs an employment contract. Anyone who discloses the named trade secrets will be in a world of legal trouble, and could be harshly penalized, including massive payments to make up for real and future lost profits.
Beyond using a nondisclosure agreement, trade secrets can also be marked “confidential” to reinforce the need for secrecy. Anything that is digital must also be intensely protected through antivirus software, firewalls, and other computer protocols. The one thing you probably do not want to do is register your trade secret officially, or patent it. This will create public records of your business idea that could be susceptible to thievery and exploitation that you cannot stop, such as someone hacking into the county clerk’s registry. As the old mantra goes, if you want something done right, you need to do it yourself – and this applies to protecting trade secrets.
Want to know more about Texas trade secret law and how to seal away your unique business ideas effectively? Perhaps your trade secret was jeopardized and now you need to know your choices of legal recourse? Call (713) 574-2299 to speak with a Houston business attorney from Toppins Law Firm, P.C. today.