Trade Secrets in Arkansas
Do’s and Don’ts of CBI
AEF AIR SEMINAR 2024
THE LAW
Information must meet the Arkansas Trade Secret Act
definition, the APC&EC Rules definitions, and all of the
six factors set forth in case law in order to qualify as a
trade secret.
Arkansas Trade Secrets Act and APC&EC
Rules 18 and 19 defines “Trade Secrets” as
information, including a:
•
Formula,
•
Pattern,
•
Device,
•
Method,
•
Technique,
•
Process, or
TRADE SECRETS
•
Rate of production
that:
Derives independent economic value, actual or
potential, from not being generally known to,
and not being readily ascertainable by proper
means by other persons who can obtain
economic value from its disclosure or use;
and
Is the subject of efforts that are reasonable
under the circumstances to maintain its secrecy.
Statutes: Ark. Code Ann. §§ 4-75-601 to 4-75-607
APC&EC Rules: 18.1402 and 19.413
There are
six factors
dictated by case law that
DEQ must use to evaluate the TS claim:
1.
The extent to which the information is
known outside the business.
Is this formula common? Is it what all
manufacturers use?
2.
The extent to which the information is
known by employees and others
involved in the business.
Does everyone know or is it a closely
held secret kept only to a few?
3.
The extent of measures taken by a
business to guard the secrecy of the
information.
Is it kept under lock and key? Also see
No. 2.
4.
The Value of the information to the
business and its competitors.
Will someone be able to underbid
you? Will you lose a lot of money? Etc.
5
. The amount of effort or money
expended by the business in developing
the information;
Was it easy to develop? Spend millions
in R&D or years? Etc.
6. The ease or difficulty with which the
information could be properly acquired
or duplicated by others.
Is it easy for someone else to figure out?
Can you Google it?
The Case Law
Wal-Mart Stores, Inc. v. P.O. Market, Inc., 347 Ark. 651
(2002)
•
P.O. Market, Inc. sued Wal-Mart for
misappropriation of a trade secret. P.O. won
their jury trial in circuit court in the amount of
$31.7 million, and Wal-Mart appealed.
•
The Arkansas Supreme Court held that the
concept to finance bulk purchases by pre-
ordained customers of the warehouse club was
not so unique as to qualify it as a trade secret.
The circuit court case was reversed and
dismissed.
•
P.O. Market lost.
The Affidavit
You must submit an affidavit with your trade secret
request. It must contain certain things.
1. Why it is a trade secret?
2. How it complies with the six factors from law?
AND
3. The magic sentence
……
“The applicant agrees to act as an indispensable
party and to exercise extraordinary diligence in any
legal action arising from the Department’s denial of
public access to the documents or information
clai
med herein to be
a trade secret.”
3. The magic sentence
……
“The applicant agrees to act as an
indispensable party and to exercise
extraordinary diligence in any legal action
arising from the Department’s denial of
public access to the documents or
information clai
med herein to be
a trade
secret.”
Why is all of this such a big deal?
DEQ can get sued for not disclosing
information that was erroneously
determined to be a trade secret AND your
client has to defend it.
DO’s
•
Review the list of what is legally
considered a Trade Secret.
•
Include your explanation in the affidavit,
without disclosing the TS, as to why you
are entitled to TS protection.
•
Include the magic words in the Affidavit:
“
The applicant agrees to act as an
indispensable party and to exercise
extraordinary diligence in any legal action
arising from the Department’s denial of
public access to the documents or
information claimed herein to be a trade
secret
.”
•
Make it easy for E&E lawyers to ID
what you’ve redacted.
•
Mark cover page clearly and boldly as
CONFIDENTIAL
in red.
•
Then mark it only on the pages that
contain confidential info.
•
Make sure page numbers correspond
between public and confidential
copies
Suggestions:
•
Use removable tabs to mark pages
with redacted copy.
•
Seal confidential copy in an envelop
marked confidential, and then put it an
another envelope with the public copy
and affidavit to either mail or hand
deliver.
DO NOT
•
Email it. Remember FOIA.
•
Fail to mark which copy is public and
which is
confidential
.
•
Send an incomplete affidavit. (Magic
language)
•
Mark every page as confidential.
•
Make it difficult to make the
determination or defend the
determination.
•
Reword your public copy unless you
make an appointment to sit down with
an attorney and possibly an engineer to
explain it. (hint: just don’t do it.)
•
Forget an affidavit all together.
If you do it wrong:
Best case: Your submission gets returned.
Worst case: Your information is released to
your competitor or your client pays large
legal fees to defend it.
Made-up Examples
CONFIDENTIAL
The tall brown cow, weighing 1.6 tons,
jumped over the moon using a T2689
booster at 679fp with 2003m for 9.23s.
CONFIDENTIAL
The tall brown cow, weighing
1.6tons
,
jumped over the moon using a
T2689
booster at
679fp
with
2003m
for
9.23s
.
KEEP IN TOUCH
TRACY ROTHERMEL
General Counsel/Sr. Attorney
Office of Chief Counsel
PHONE
t:
501.682.0743
WEBSITE
Tracy.Rothermel@Arkansas.gov
www.ee.arkansas.gov
@AREnergyEnvironment
@ArkansasEE
Explore the dos and don'ts of Trade Secrets as defined by the Arkansas Trade Secret Act and APC&EC Rules. Learn about the key factors, evaluation criteria, and protection measures related to trade secrets, essential for businesses to safeguard their valuable information effectively.
Uploaded on Sep 26, 2024 | 0 Views
Download Presentation
Please find below an Image/Link to download the presentation.
The content on the website is provided AS IS for your information and personal use only. It may not be sold, licensed, or shared on other websites without obtaining consent from the author.If you encounter any issues during the download, it is possible that the publisher has removed the file from their server.
You are allowed to download the files provided on this website for personal or commercial use, subject to the condition that they are used lawfully. All files are the property of their respective owners.
The content on the website is provided AS IS for your information and personal use only. It may not be sold, licensed, or shared on other websites without obtaining consent from the author.
E N D
Presentation Transcript
Dos and Donts of CBI AEF AIR SEMINAR 2024
THE LAW Information must meet the Arkansas Trade Secret Act definition, the APC&EC Rules definitions, and all of the six factors set forth in case law in order to qualify as a trade secret.
TRADE SECRETS Arkansas Trade Secrets Act and APC&EC Rules 18 and 19 defines TradeSecrets as information, including a: Formula, Pattern, Device, Method, Technique, Process, or
Rate of production that: Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by other persons who can obtain economic value from its disclosure or use; and Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. Statutes: Ark. Code Ann. 4-75-601 to 4-75-607 APC&EC Rules: 18.1402 and 19.413
There are six factors dictated by case law that DEQ must use to evaluate the TS claim: 1. The extent to which the information is known outside the business. Is this formula common? Is it what all manufacturers use? 2. The extent to which the information is known by employees and others involved in the business. Does everyone know or is it a closely held secret kept only to a few?
3. The extent of measures taken by a business to guard the secrecy of the information. Is it kept under lock and key? Also see No. 2. 4. The Value of the information to the business and its competitors. Will someone be able to underbid you? Will you lose a lot of money? Etc.
5. The amount of effort or money expended by the business in developing the information; Was it easy to develop? Spend millions in R&D or years? Etc. 6. The ease or difficulty with which the information could be properly acquired or duplicated by others. Is it easy for someone else to figure out? Can you Google it?
The Case Law Wal-Mart Stores, Inc. v. P.O. Market, Inc., 347 Ark. 651 (2002)
P.O. misappropriation of a trade secret. P.O. won their jury trial in circuit court in the amount of $31.7 million, and Wal-Mart appealed. The Arkansas Supreme Court held that the concept to finance bulk purchases by pre- ordained customers of the warehouse club was not so unique as to qualify it as a trade secret. The circuit court case was reversed and dismissed. P.O. Market lost. Market, Inc. sued Wal-Mart for
You must submit an affidavit with your trade secret request. It must contain certain things. 1. Why it is a trade secret? 2. How it complies with the six factors from law? AND 3. The magic sentence The applicant agrees to act as an indispensable party and to exercise extraordinary diligence in any legal action arising from the Department s denial of public access to the documents or information claimed herein to be a trade secret.
3. The magic sentence The applicant agrees to act as an indispensable party extraordinary diligence in any legal action arising from the Department s denial of public access to information claimed herein to be a trade secret. and to exercise the documents or
Why is all of this such a big deal? DEQ can get sued for not disclosing information that determined to be a trade secret AND your client has to defend it. was erroneously
Review the list of what is legally considered a Include your explanation in the affidavit, without disclosing the TS, as to why you are entitled to TS protection. Trade Secret.
Include the magic words in the Affidavit: The applicant agrees to act as an indispensable party and to exercise extraordinary diligence in any legal action arising from the Department s denial of public access to the documents or information claimed herein to be a trade secret.
Make it easy for E&E lawyers to ID what you ve redacted. Mark cover page clearly and boldly as CONFIDENTIAL in red. Then mark it only on the pages that contain confidential info. Make sure page numbers correspond between public and confidential copies
Suggestions: Use removable tabs to mark pages with redacted copy. Seal confidential copy in an envelop marked confidential, and then put it an another envelope with the public copy and affidavit to either mail or hand deliver.
Email it. Remember FOIA. Fail to mark which copy is public and which is confidential. Send an incomplete affidavit. (Magic language) Mark every page as confidential. Make it difficult to make the determination or defend the determination.
Reword your public copy unless you make an appointment to sit down with an attorney and possibly an engineer to explain it. (hint: just don t do it.) Forget an affidavit all together.
If you do it wrong: Best case: Your submission gets returned. Worst case: Your information is released to your competitor or your client pays large legal fees to defend it.
CONFIDENTIAL The tall brown cow, weighing 1.6 tons, jumped over the moon using a T2689 booster at 679fp with 2003m for 9.23s. CONFIDENTIAL
The tall brown cow, weighing 1.6tons, jumped over the moon using a T2689 booster at 679fp with 2003m for 9.23s.
KEEP IN TOUCH TRACY ROTHERMEL General Counsel/Sr. Attorney Office of Chief Counsel PHONE t: 501.682.0743 EMAIL Tracy.Rothermel@Arkansas.gov WEBSITE www.ee.arkansas.gov @ArkansasEE @AREnergyEnvironment
