If any ex-employee has stolen confidential information of the company he worked for but not using yet, can a complaint be filed against this?
You may have several claims for a lawsuit, like breach of contract, conversion, unfair competition, and trade secrets. You should sit down with an attorney in your area to discuss the options. It may depend on how you protected the information, whether the information is in hard copy form, etc.
Disclaimer of California Attorney. Laws differ from state to state. Although the above response is believed to be accurate, it should not be relied upon as any type of legal advice because the information provided is incomplete. It is intended to educate the reader and a more definite answer should be based on a consultation with a lawyer. No attorney client relation is formed with me without a written contract. Trevor E. Carson, Attorney-At-Law 900 Howe Ave Suite 230 Sacramento, CA 95825 http://www.carsonkyung.com Office (916) 241-3336
You should consult with a local litigation business attorney, preferably one familiar with intellectual property, particularly trade secrets. Many of these attorneys will provide an initial consultation at no charge. You should show this attorney the nature of the information you think your ex-employee stole from you and why you believe the information has been stolen. Also, you should be prepared to tell your attorney whether you had a WRITTEN employment agreement that included protection of trade secrets and confidentiality. Finally, the attorney you meet with will want to know how your business is structured, i.e. a corporation or as a sole proprietor AND whether your ex-employee put any money or property into the business. For example, was the ex-employee a software developer, etc. You should move quickly. Good luck!
Disclaimer: The above is general legal and business analysis. It is not "legal advice" but analysis, and different lawyers may analyse this matter differently, especially if there are additional facts not reflected in the question. I am not your attorney until retained by a written retainer agreement signed by both of us. I am only licensed in California. See also avvo.com terms and conditions item 9, incorporated as if it was reprinted here.
If the information is Trade Secret then the stolen property is both civil and criminal misappropriation. See IP Counsel for guidance whether the info is Trade Secret.
My comments have been made without discussion. An attorney client relationship has not been established. There may be conflicts which prohibit my providing you with specific legal guidance. Any contact with you beyond these few general words will start with a disclosure of opposing parties so that a conflict check can be made. You should discuss with an attorney.
First of all, do not delay in taking action. Once information is out in the public you can't make secret again. Speak with both a civil litigator and the police. Theft is theft. What sort of documentation do you have affirming that the information was confidential and that the ex-employee was aware of, and agreed to, its secrecy? Don't tell us here on Avvo, tell your retained attorney.
Potentially, yes. You need to consult an intellectual property litigation attorney.
The California Uniform Trade Secrets Act (Cal. Civ. Code 3426) states that a trade secret is:
"d) "Trade secret" means information, including a formula,
pattern, compilation, program, device, method, technique, or process,
(1) Derives independent economic value, actual or potential, from
not being generally known to the public or to other persons who can
obtain economic value from its disclosure or use; and
(2) Is the subject of efforts that are reasonable under the
circumstances to maintain its secrecy."
And, misappropriation of a trade secret includes acquisition by improper means, use or disclosure of the secret.
You and an IP litigator will need to evaluate whether the confidential information qualifies as a trade secret. You should also consider whether filing a lawsuit will make economic sense, (because there may be minimal or no damages) if the ex-employee has not yet used the information. That said, many trade secret cases are about getting the information back or preventing it from being disclosed further, rather than about money damages.
The information contained in this answer is intended to provide general information only and not legal advice. You should consult with an attorney licensed to practice in your jurisdiction before relying upon any of the information presented here. Sending e-mail to or viewing or downloading information to me or my website does not create an attorney-client relationship.
To echo, but emphasize what's been said already, you will need to thoroughly discuss with an attorney what specific information has been taken, what really makes it secret, and, perhaps most importantly, what true danger you face if the information is used or otherwise put out in the open. I say this because in my experience 4 out of 5 fire drills like this tend to fizzle after a good discussion. That's not to say that yours isn't the 1, so move quickly.
My comments do not constitute legal advice and should not be relied upon as such. My comments likewise do not create an attorney-client relationship between us.
I experienced an issue similar to this recently and there are a few considerations here to think about.
The first is that misappropriation of trade secrets has a criminal culpability aspect to it: Espionage. The second consideration is to think about if the employee shares the information with a competitor, would this potentially be devastating to your business? The third consideration is to determine whether the person who stole the information has the ability to pay a judgment. Many times things can be done inexpensively through a strongly worded letter.
I highly recommend you begin the process of hiring an attorney.
Yes, a complaint can be filed for theft of confidential information. This is a serious matter. Consult with and retain an experienced IP attorney to represent you. Don't go at it alone!
Mr. Sack's postings on Avvo are of a general nature, based on the facts provided and are not intended to be taken as legal advice or to establish an attorney-client relationship.
You can initiate legal action. You should immediately prepare a complaint and an application for a temporary restraining order to compel release of the information back to you and to further bar any use of the information.
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