Employment litigation can be initiated by workers making a claim against a business. Other times, employers may need to take legal action against current or former employees for conduct that violates an employment contract. For example, a worker who recently left their position may have taken a job with a direct competitor. They might have then shared trade secrets that they learned during their prior employment with their new employer.
Other times, employees with access to valuable trade secrets, including formulas, client lists and other non-public information, might start a competing business. Former employers may need to take legal action to hold those employees accountable.
Is there a non-disclosure agreement in place?
Businesses hiring workers who may have access to trade secrets frequently use restrictive covenants to minimize their exposure. A non-disclosure agreement, also known as a confidentiality agreement, can help limit the release of trade secrets.
California does restrict the enforcement of confidentiality agreements in some cases. However, those restrictions apply to sexual harassment and allegations of misconduct in the workplace, rather than protected trade secrets. In scenarios where the employee’s contract included a confidentiality agreement, the company may be able to pursue litigation to enforce that agreement.
Without a confidentiality agreement, it may still be possible to take legal action over the misappropriation of trade secrets. The business may be able to hold the former employee or the company misusing the trade secrets directly responsible for that misconduct.
Reviewing details of a trade secret infringement scenario with an attorney can help business leaders determine the best way to respond. Breach of contract litigation that is successful can result in an award of damages or an injunction preventing the continued use of misappropriated trade secrets.