Saturday, February 11, 2012

Employee Found Guilty of Stealing Trade Secrets – How Safe Are Yours?

When the news broke that Hanjuan Jin was convicted this week of stealing trade secrets from her employer, Motorola Inc., businesses across the country immediately began wondering the same thing: How safe are our trade secrets?

Jin, a Chinese-born naturalized U. S. citizen, was employed by Motorola for years and had recently taken a long medical leave from work. When she returned, she spent two days downloading more than a thousand technical documents, many of which contained highly-confidential information considered by Motorola to be trade secrets, onto CDs, flash drives, and other media. Then, she tried to board an airplane carrying the purloined documents, $31,000 in cash, and a one-way ticket to China. The one-way ticket triggered a random baggage search. Although Jin claimed that she took the documents simply to refresh her technical knowledge after a long absence, she was arrested and charged with violations of the Economic Espionage Act.

During the trial, part of Jin’s defense was that Motorola could not truly have considered the documents to be trade secrets because much of the technology at issue was outdated and the company protected the documents with safeguards that were relatively easy to breach. The evidence showed, however, that Motorola had imposed strict security measures, including special passwords, but that Jin had been able to get around the protocols. In the end, she was convicted on several of the counts and faces up to 15 years in prison when sentenced later this year.

Had this been the only case of kind in recent memory, employers might have taken it more in stride. It was, however, just the latest in a series of cases involving theft of trade secrets, and it has fueled renewed concerns about how companies can protect their trade secrets from unscrupulous employees.

Once a business identifies its trade secrets and other confidential information, a number of tools are available to help protect those assets, including nondisclosure agreements, non-competition agreements, passwords and locks, data encryption, employee education programs, and more.  Although federal prosecutors in the Motorola case charged Jin with criminal violations, the most common scenario to address actual or threatened theft of trade secrets involves civil law efforts initiated by the business.  Appropriate action can range from legal correspondence (e.g., cease-and-desist letters) to seeking an injunction to filing a lawsuit for damages to some combination of these and other actions.

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