Pillsbury Attorney Parses Trade Secrets Issues in E-discovery

The DTSA provides two new protections to owners of trade secrets: A court may require affirmative actions to protect a trade secret, and in criminal proceedings, the court may not authorize or direct the disclosure of any information the owner says is a trade secret unless the court allows the owner the opportunity to file a submission under seal that describes the interest of the owner in keeping the information confidential.

Many counsel are seeking to extend those protections to e-discovery. To further encourage secrecy, Stanton said, “We are advising clients to consider hosting it themselves, and allowing it to be inspected rather than producing and losing control to a third party.”

During e-discovery, increasingly the standard protective order “[takes] on more rigorous requirements, including notifications of any type of cyber intrusion or unauthorized access, and detailed requirements on what kind of systems will be used, with what sorts of security protections, to host trade-secret data,” he added.

Another key question is whether the protection of trade secrets in litigation should be the subject of new rule making.

“Although courts had no difficulty imposing onerous and costly e-discovery requirements on producing parties, they seem in general less willing to impose the same requirements on requesting parties,” Stanton said. “Companies spend millions of dollars on cybersecurity. In an era where their opponents are prime hacking targets, they have every right to expect a comparable level of protection, and without rules making this a requirement, courts will adopt disparate approaches and leave parties, who are already defending their trade secrets, that much more exposed.”